The Best States for Landlords: Make Your Investment More Rewarding in 2022

Are you considering buying rental property out of state? If so, it's crucial to know which states are the best for landlords. Understanding the landlord-friendly states will make your investment experience much more rewarding and ensure your success as a rental property owner. In this article, we will explore the top states for landlords in 2022 and provide you with valuable insights to help you make informed decisions.

What Makes a State Landlord-Friendly?

Before we dive into the list of the best states for landlords, it's essential to understand what makes a state favorable for rental property owners. Here are some key factors to consider:

1. Favorable Eviction Procedures

Landlord-friendly states have eviction procedures that make it easier for property owners to remove tenants who breach their contracts or fail to pay rent. These states prioritize the rights of the property owner and provide a swift and painless process for eviction.

2. Upheld Landlord Rights

Some states tend to favor tenants over landlords, which can put property owners at a disadvantage, especially when dealing with problem tenants. Landlord-friendly states ensure that the rights of property owners are upheld and protected.

3. Better Rent Control

While rent control laws aim to protect tenants from excessive rent increases, they can be detrimental to property owners. Landlord-friendly states have rent control policies that strike a balance, allowing landlords to make a decent living while ensuring fair rental prices.

4. Easy Registration and Acquisition of Licenses

Dealing with paperwork and acquiring licenses can be a hassle for rental property owners. Landlord-friendly states have simplified processes or minimal requirements, reducing the burden on investors.

5. Favorable Tax and Insurance Rates

States with lower tax rates and reasonable insurance rates attract rental property owners. These factors directly impact the profitability of investment properties, making states with favorable rates more attractive to landlords.

Now that we understand the criteria for a landlord-friendly state, let's explore the top states that meet these standards in 2022.

10 of the Best States for Landlords in 2022

1. Alabama: With low property tax rates and favorable eviction procedures, Alabama offers investors a significant opportunity to save money and manage properties efficiently.

2. Arizona: Boasting low property tax rates and landlord-friendly laws, Arizona provides a conducive environment for rental property investment.

3. Colorado: Colorado's favorable rent laws, lower property prices, and high employment rates make it an attractive state for landlords.

4. Florida: With no rent controls or restrictions on late fees, Florida offers high returns and a landlord-friendly legal environment.

5. Georgia: Georgia's flexible eviction rules, reasonable property tax rates, and absence of limits on security deposits make it an appealing state for landlords.

6. Illinois: Illinois stands out with its large tenant pool, established security deposit rules, and relatively easier eviction process.

7. Indiana: Offering reasonable rental rates, low tax rates, and tenant-friendly laws, Indiana is a top choice for rental property owners.

8. North Carolina: With low property taxes, a growing economy, and no eviction laws, North Carolina provides a favorable climate for landlords.

9. Texas: Texas offers a wide array of advantages for landlords, including affordable markets, increasing demand for rental properties, and strong legal protection for property owners.

10. West Virginia: With low property tax rates, low home values, and no restrictions on security deposits, West Virginia presents a valuable opportunity for rental property investment.

How to Buy Out-of-State Properties

Buying out-of-state properties adds complexity to the investment process. Here are some essential steps to ensure a successful purchase:

1. Build a Team: Collaborate with real estate agents, contractors, property management teams, insurance agents, and others to navigate the unfamiliar territory of out-of-state investments.

2. Conduct Due Diligence: Research the market, tax laws, local rental regulations, and other vital factors. Leverage technology, such as Mashvisor's Property Finder tool, to simplify and accelerate your research process.

3. Find a Reliable Property Management Team: A property management team can minimize tenant turnover, handle rental and tenant concerns, and ensure a smooth rental experience.

4. Consider Familiar Areas: If possible, invest in areas that you are familiar with or have personal connections to, as this can provide an advantage and ease anxiety about investing in unfamiliar markets.

5. Inspect the Property: Never purchase a property without seeing and inspecting it in person. Photos can be misleading, and a personal visit allows you to assess the property accurately.

6. Get Pre-approved: Meet with local lenders to understand mortgage types and interest rates. Getting pre-approved saves time during the closing process.

Investing in out-of-state properties can be rewarding, but it requires careful planning and diligence. By following these steps and considering the best states for landlords, you can enhance your chances of success and maximize your investment.

In conclusion, knowing the best states for landlords is crucial for successful out-of-state property investments. Consider the key factors that make a state landlord-friendly and explore the top states listed here. With the right research, support, and approach, you can make your rental property investment significantly more rewarding.