Long-term profits from rental property investments
Property investments in landlord friendly states protect your investment and reduce headaches in the long run. Owning a rental property that generates long-term profits is one of the best ways to build wealth in real estate. When searching for the best states to invest in real estate properties, consider how friendly is the state where the rental property you are considering is located.
What makes a state landlord-friendly?
What is a landlord-friendly state? As a property owner, it goes without saying that you need to do your best in taking care of your tenants. However, there are times when things can go awry in your rental business. When this happens, you need to make sure that your investments are well protected.
The most landlord-friendly states have laws that give more protection to the property owners than just about everywhere else. The best states for private landlords have minimal licensing and registration requirements, affordable property taxes, an easy eviction process, and favorable regulations on rent increase. Having these laws in the landlord’s favor does provide an extra layer of peace of mind in the event you need to pursue legal action. Based on these criteria, we rounded up 10 states that have the most landlord-friendly laws. Consider these locations for your next real estate investment property purchase:
10 of the Most Landlord-Friendly States in 2021
Texas
It is hard to beat the “Lone Star” state when it comes to providing easy relief, compensation, or repossession of rental units in the event that lease conditions are violated. Private landlords in Texas can give a 3-day notice (sometimes even shorter!) for tenants to pay or leave the property if rent payments are late or the lease contract has been breached. Landlords also set the terms for unit repairs, which means tenants may be responsible for repair payments. Additionally, landlords are allowed by state laws to retain security deposits up to 30 days after the tenant moves. This gives landlords plenty of time to inspect the property for damages that may be caused by tenants.
Indiana
Indiana’s median home value is well below the national average while the rental rates are relatively high which makes it attractive to real estate investors. This gives a price-to-rent ratio that earns a considerable profit potential. Also, Indiana laws also don’t put a limit on security deposits and gives up to 45 days for private landlords to withhold deposits that allows for a thorough inspection of the property.
Colorado
Landlords find Colorado to be a great place to own rental property because the laws lean heavily in their favor. While the eviction process in other states drags on too long, evicting a tenant for unpaid rent is much easier here in Colorado. Tenants with late rent are given a mere 72 hours to comply after the notice is served and only 48 hours to leave the property if tenants do not comply.
Alabama
Property taxes in Alabama are the second-lowest in the country. This alone makes the state an attractive choice to real estate investors. In addition, property owners can raise their rent as long as they provide a 30-day written notice and set their own price for late rent fees. The eviction process also heavily favors the landlords. To end the lease, they can give a 14-day notice and if tenants fail to comply, a 7-day eviction notice can be given.
Arizona
It is easy for private landlords to terminate a tenancy in Arizona. They can give a 5-day or 10-day period for the tenant to comply with lease violations before they file for eviction. Similar to Alabama, landlords in Arizona can also raise the rent after a 30-day notice.
Florida
Landlords can take advantage of the lack of detail in the rental laws to tailor-fit their guidelines for their protection. They are also allowed to charge a security deposit and set fees for late rent according to their fair judgment.
Kentucky
Kentucky is another good choice for real estate investors because of their easy eviction process. As a landlord, you can give as short as a 7-day notice once a tenant fails to pay rent before filing an eviction case. If the rental agreement is violated in other ways, you may give the tenant 15 days to comply before eviction. If a tenant has received a 15-day notice within 6 months, a landlord can file a 14-day unconditional quit notice.
Georgia
Eviction laws highly favor landlords in Georgia. A written notice of eviction is not required here. This makes it more flexible and informal compared to other states. Although most landlords still provide a written notice, this is not a requirement. In Georgia, regulations don’t indicate how long landlords should wait before filing for eviction so evictions is fairly a quick process.
Louisana
In the”Big Easy” a landlord has to give only five days’ notice to terminate a lease for nonpayment of rent or other violations. There is no security deposit limit and the landlord has up to 30 days to return the security deposit if the tenant qualifies. Also, tenants cannot withhold rent only deduct costs from the rent payment to make essential repairs that are pre-approved by the landlord.
North Carolina
Landlord-tenant laws in North Carolina make the state a good choice for investors. There is no statute on evictions so landlords can end the tenancy with a termination notice if a lease term or rental agreement term is violated. No rent control or landlord licensing required.
It is in your best interest to invest in states where the laws work in your favor so you can earn a living from your real estate investing business. Hence, pay special consideration to the rules and regulations in the particular state where you are interested to buy a rental property.
