When diving into real estate investing for the first time, there are several factors you should consider before making a final decision, especially if you’re looking to purchase short-term rentals in the United States.

Location is often one of the most crucial considerations, not only in terms of the projected profitability of your investment but also in terms of the nature of the landlord-tenant laws in place. Some states seem to favor tenants over landlords, while others will have more landlord-friendly legislation in place to make the job easier for investors like you. Knowing the difference between the two and becoming familiar with your location’s landlord-tenant laws might very well be what makes your short-term rental investment succeed!

So, how can you leverage landlord-friendly rental laws to your advantage? What states should you avoid to make your life much easier? And what does landlord-friendly mean, anyway?

In this article, we want to answer all of these questions and more. We want you to be able to go ahead and close the deal on the property you’ve had your eyes on for months with complete peace of mind, knowing that the state will have your back if anything falls through!

What makes a state landlord-friendly?

So, what do we mean when we say that some state laws are more landlord-friendly than others?

In short, landlord-friendly states are states where landlord-tenant laws favor property owners when it comes to different types of disputes, including the eviction process, property taxes, security deposit timelines, notices, maintenance, and repair issues. In addition to that, some might refer to a state as landlord-friendly if the housing market is projected to grow and the area is expected to become more desirable while house prices are comparably low.

So, what are the most important rules and regulations you should be keeping an eye out for in order to find the best location for your next investment property?

Low property taxes

There’s no way around paying property taxes for a rental property you’re investing in, but if you play your cards right by choosing a state or city with lower property taxes compared to states with high tax rates like Illinois and New Jersey you just might save some money.

By choosing a property of the same size and features in a low tax rate state like Alabama or Colorado, you can effectively cut down your property management expenses with very little effort. This could save you tens of thousands of dollars in the long run!

Lenient rent control laws

Some states and cities like Washington D.C and San Francisco impose strict rent control laws prohibiting property owners from increasing rent prices above a certain threshold and beyond a set frequency.

If you’re a property owner looking to have more freedom on how often you can raise the rent, and make sure your investment is as profitable as you want it to be, you should buy a rental property located in the states where rent control laws are either more lenient or completely nonexistent, like Georgia or Alabama.

Quick eviction process

Being a landlord is certainly not an easy job. With bad, problematic tenants making property management that much harder, you might be faced with the tough decision to file for eviction at some point.

It might be that your tenants are not able to pay rent for months at a time, or that they are violating the rental agreement you have both signed by smoking on the premises, having pets, or not taking care of the home as they should. Whatever the reason might be, some states are going to require a much longer, more complex eviction process (as long as two or three months). Others, however, have set up a far less complicated, quicker process.

Other landlord-friendly landlord-tenant laws

From security deposit regulations to lease termination directives, there are many more landlord-tenant laws that can favor landlords, and give them more agency when it comes to managing their property and the relationship with their tenants.

If you’re not sure whether your chosen location’s laws favor tenants over landlords, make sure to get in touch with a few realtors or property managers that live in your next investment area, so you can get familiar with and leverage the local landlord-friendly laws to your advantage. 

Which states are the most landlord-friendly?

So, what are the most landlord-friendly states in the U.S. in 2021?

If you’re looking for states that fit the landlord-friendly bill in more ways than one, including no rent control, an up-and-coming market, and a quick eviction process in the case of problematic tenants with unpaid rent, look no further than these five landlord-friendly locations for your next rental investment!

Florida

Sunny Florida not only boasts the highest number of renters in the whole of the U.S. but also stands out as one of the most landlord-friendly states in the country, featuring plenty of lenient rental property laws that favor property owners and landlords.

Florida has no rent control regulations and no restrictions on late fees. It also has no limitations when it comes to asking for security deposits (with the exception of landlords having to return the deposit within 15-60 days of the tenant moving out of the property).

In the case of unpaid rent, landlords have to provide a written notice giving the tenant three days to either pay rent or leave the property, making for one of the most landlord-friendly eviction processes in the country!

Alabama

The eviction process in Alabama also favors landlords, requiring them to provide a written notice to pay overdue rent in seven days in the case of missed rental payments or 14 days in the case of a tenant breaching the rental agreement.

There is also no limit on charging late rent fees, and landlords are not required to have a license to own and rent out rental properties. Last, but definitely not least, Alabama boasts one of the lowest property tax rates in the U.S. — the second-lowest after Hawaii.

Arizona

Arizona also boasts some of the lowest property tax rates in the country along with one of the most landlord-friendly eviction processes: If the tenant fails to pay rent on time, landlords can serve a 5-day notice to terminate the rental agreement, 5-day notice for failing to maintain the property, or 10-day notice for violating the lease in any way.

If the tenant fails to pay or fix these issues, the landlord can file an eviction lawsuit or even serve an Unconditional Quit Notice in the case of serious violations, for example, criminal activity or failure to disclose criminal records.

Georgia

With property tax rates as low as 0.91% as of 2021, Georgia has long been one of the favorite landlord-friendly states for owners and investors to head to.

The state also allows for an informal eviction process, requiring landlords to leave a notice for rent payments due but not imposing any set notice periods or needing a written notice at all. Consider that Georgia also puts no limits on security deposits or late rent fees and that landlords can legally enter the property without prior notice: What you get is an incredibly landlord-friendly state full of natural beauty and convenient investment options!

Tennessee

Finally, we have Tennessee, another beautiful state with no rent control regulations and plenty of landlord-tenant laws favoring landlords, such as a quick and streamlined eviction process (14-day notice for all violations) and exceptionally affordable registration fees for rental properties.

Tennessee boasts some of the lowest property tax rates in the country at 0.74%. It also has affordable entry prices which, paired with an up-and-coming housing market with more people moving to the state than ever before, makes for the perfect recipe for savvy landlords looking for profitable real estate investments!

Which state has the highest eviction rate?

As a last caveat, landlords looking to buy rental properties in a landlord-friendly state have to consider which states feature the highest eviction rates, so that they can ensure they’re not investing in locations where renters are struggling the most.

South Carolina is currently the state with the highest eviction rates in the country. Data shows that more renters are behind on rent payments and are at risk of being evicted in the next two months in South Carolina than anywhere else in the country.

In which states is our team working? This is how we’re making real estate investing easy

So, how are we doing our part to ensure savvy landlords and real estate investors are put in the best possible position before closing the deal on their next rental investment?

With an extensive range of listings in Florida, Tennessee, and Alabama, our short-term rental directory is your go-to destination for finding profitable investment opportunities in some of the country’s most landlord-friendly states. We operate in states with favorable landlord-tenant laws and fast-growing markets for short-term rentals, so you can find your next investment knowing you’re already on the right path to success — get in touch today to get started!