What are the Best States for Landlords? A Guide
Being a landlord – or deciding to be one – comes with all kinds of decisions. That is kind of life in general. One question comes up often, and that is where to live. Being a landlord is unique in that one state to the next it has slightly different regulations than another. Landlord living can be a little easier in one place versus another. What are the best states for landlords? That takes a little digging to discover the nuances of each state and their laws.
As an Atlanta property management company we have to get familiar with that particular state and how being a landlord operates there. But we also manage property in Massachusetts, Texas, Virginia, and a number of other states. So that means we have to be experts in a lot of places. Here we break down some of the overarching considerations when debating which are the best states for landlords.
Table of Contents
- What Makes a State Landlord Friendly?
- What are the Best States for Landlords?
- Why Hiring a Property Manager Could Be the Best Thing For You
What Makes a State Landlord Friendly?
What does it mean to be “landlord friendly.” It’s an interesting way to put it. That said, there are a lot of people who ask that question. Generally speaking, a landlord-friendly state is one where rental laws and other factors tend to favor property owners when it comes to things like eviction procedures, rent control, security deposit rules… well, overall, they provide flexibility in managing rental properties in that state. When there is this type of flexibility landlords can typically raise rent without restrictions, set their own late fees, and have an easier time removing tenants who don’t pay or break lease terms. While this may make room for “bad” landlords to do questionable things, if you’re a good landlord who is just trying to do their job, being free of these types of regulations sounds pretty good.
One of the biggest factors that make a state landlord friendly is how quickly and easily a landlord can evict a tenant if necessary. In states with strict tenant protections, eviction can take months. In landlord-friendly states, the process is often much faster.
Another big factor is whether the state has rent control laws. Some states or cities have strict limits on how much landlords can increase rent each year. This can make it harder to keep up with rising costs like property taxes and maintenance. Some of the best states for landlords either ban rent control altogether or allow landlords to raise rent as they see fit.
Security deposit rules also make a difference. In some states, landlords have strict limits on how much they can collect for a deposit and have to follow detailed procedures when handling and returning it. Landlord-friendly states give property owners more control over security deposits, letting them set reasonable amounts and deduct for damages without excessive legal ramifications.
What are the Best States for Landlords?
If you’re seeking out the best states for landlords, ultimately you want to find a succinct list that breaks down some of the reasons – based on similar criteria like the above – all broken down in one place. Here we have such a list. While this doesn’t account for your own personal preferences, such as cities and regions you like for all types of other reasons or perhaps because you have friends or family native to certain states, a list like this at least pulls together a number of the landlord-centric factors that you can consider.
1 – Georgia
Georgia stands out as a good choice for landlords due to its favorable legal environment. The state has no rent control laws. There are also no statutory limits on security deposits or late fees, and Georgia’s eviction process is relatively swift. On top of that, the state’s property tax rate is modest, averaging around 0.91%, which is a nice advantage for property owners and ultimately landlords.
2 – Texas
Texas offers a landlord-friendly atmosphere with no rent control… sounds like a good start. The state also doesn’t have caps on security deposits and late fees. The eviction process is pretty streamlined. However, some have said finding tenants in certain areas and cities in Texas can cause problems. Just one reason why hiring a good property management company can make a world of difference.
3 – Florida
Florida is looking good for landlords for a number of reasons. It also does not have rent control like some other states, which always sounds good when seeking out the best states for landlords. It matches a number of these other states when it comes to flexibility with security deposits and late fees. The eviction process is efficient, often allowing landlords to regain possession within two to three weeks for non-payment cases. You also don’t need to register to be a landlord in Florida and the process for becoming one is quite easy… this sounds good, although one drawback is that that sometimes creates a lot of competition in certain regions.
4 – Alabama
Alabama boasts some of the lowest property taxes in the nation, averaging just 0.42%. That’s a great start! The state does not impose rent control, and things like eviction processes are considered fast and relatively painless. One drawback to being a landlord in Alabama is living in Alabama… a lot of people aren’t a fan of extreme weather conditions and various other ramifications for living in the state. Plus, problematic weather often means problematic repairs to rental units.
5 – Indiana
Indiana offers affordable housing options and a legal framework that seems pretty good to landlords. There are no rent control laws, and the state allows for flexible security deposit arrangements. Evictions for non-payment can begin after a 10-day notice, which isn’t bad. However, landlords are required to return security deposits within 45 days of tenant move-out, necessitating prompt property inspections and accounting. When it comes to drawbacks, ultimately each market is different. Living in Indianapolis can be very different than living in other rural parts of the state. Many people just don’t like certain areas for personal reasons. So ultimately, while whether the state is “friendly” to landlords is a concern, also factoring in the overall experience of living in that state is always a thing to think about.
Why Hiring a Property Manager Could Be the Best Thing For You
When it comes to investing in real estate, location is a major factor. For landlords, researching laws and regulations can be just as important as an area’s rental rates or local advantages. You will quickly realize some of the main differences between landlord-friendly states and some of the worst states for landlords during this search. Suddenly, it will become clear just what makes sense for you.
Once you have found the ideal rental property, seeking out professional property managers in your area is the next logical step. Bay Property Management Group is the area’s leading full-service rental experts. Our team helps owners and landlords navigate ever-changing laws and regulations while keeping their property compliant and as profitable as it can be. Give us a call today to see what BMG can do for you. We provide property services in Atlanta, Texas, Massachusetts, Virginia, and elsewhere.
