The Most Landlord-Friendly States

All across the US, landlord-tenant laws vary widely from state to state.

While some states offer stronger protections for residents, others tend to favor landlords in legal processes, property rights, and rental regulations. These so-called "landlord-friendly" states often make it easier and more cost-effective to own and manage rental properties.

If you're a landlord or considering becoming one, it's crucial to understand how state laws might impact your investment and day-to-day operations.

What Makes a State Landlord-Friendly?

So, what exactly defines a landlord-friendly state? Several key factors contribute to making a state more favorable for landlords. These include legal processes, taxation, regulatory requirements, and market dynamics.

Here’s a breakdown of what to consider:

Eviction Process

One of the most critical indicators of a landlord-friendly environment is the state’s eviction laws. While evictions are never ideal and still require a legal process, some states streamline the steps for landlords. In landlord-friendly states, timelines are shorter, notice periods are more flexible, and fewer procedural hurdles are in place. This allows a landlord to address problem residents more efficiently and get their property generating income again with minimal downtime.

Property Taxes

Property taxes can have a significant impact on the overall return as a landlord. Although one can’t avoid taxes entirely, some states offer lower rates that make investing more attractive. If you’re exploring new markets for your rental portfolio, keep an eye on states with favorable tax brackets, as they can make a significant difference over time.

Rent Control

Raising rent in line with rising property values and inflation is essential for long-term profitability. Landlord-friendly states typically have minimal or no rent control laws, giving landlords more freedom to adjust rent prices as needed. This flexibility enables you to maintain a healthy cash flow and adapt to changing market conditions.

Tax and Insurance Costs

Ongoing expenses, such as state income taxes and property insurance premiums, can also impact the bottom line. Landlord-friendly states often have lower tax burdens and more affordable insurance rates, helping maximize investment returns. Be sure to compare these costs before buying property in a new area, as they can vary widely from state to state.

Licensing and Registration Requirements

Some states require landlords to register properties or obtain rental licenses, while others keep red tape to a minimum. In landlord-friendly states, the process of getting started is often more straightforward and less expensive, with fewer ongoing regulatory demands.

Market Competition

Highly landlord-friendly states tend to attract more real estate investors, which can increase competition. While this may lead to higher prices, it can also signal strong demand and growth potential. Be sure to evaluate not only the laws but also the local rental market to ensure you’re setting yourself up for long-term success.

Post-COVID-19 Rental Regulations

The pandemic led to widespread changes in rental laws, including temporary moratoriums and new protections for residents. Some of those rules have become permanent or have influenced long-term policy changes. As you evaluate states for investment, stay informed about post-COVID regulations that could affect your rights and responsibilities as a landlord.

Methodology: How We Identified the Most Landlord-Friendly States

To determine the most landlord-friendly states, we conducted a comprehensive analysis focusing on key factors that impact landlords' profitability and operational ease. Our evaluation encompassed the following criteria:

• Eviction Laws

• Rent Control Policies

• Security Deposit Regulations

• Property Taxes and Insurance Costs

• Licensing and Registration Requirements

• Market Conditions

Here’s what we found:

The Most Landlord-Friendly States

1. Texas

Texas continues to be one of the most landlord-friendly states in the nation. The eviction process is efficient, with just a 3-day notice required before filing. There are no statewide rent control laws, and while property taxes are relatively high (around 1.68%), the strong rental demand, lenient regulations, and business-friendly climate more than offset the costs.

2. Florida

Florida remains a top state for landlords due to its favorable eviction laws (3-day notice to pay or vacate), no state income tax, and lack of rent control. The state also has a booming rental market fueled by population growth and job migration. Local laws vary, but in general, landlords have significant flexibility here.

3. Georgia

Georgia offers a relatively smooth eviction process, no rent control, and low property taxes (around 0.91%). The legal environment favors landlords, especially when it comes to lease enforcement and property rights. Georgia’s low cost of entry and growing rental demand make it a solid choice.

4. Alabama

With one of the lowest property tax rates in the country (around 0.42%) and a straightforward eviction process, Alabama is a hidden gem for rental investors. There are minimal landlord licensing requirements, and most municipalities have limited regulatory burdens.

5. Indiana

Indiana is renowned for its affordable real estate and balanced legal framework. Property taxes are around 0.87%, and eviction proceedings generally favor landlords. The state does not have rent control, and regulations on security deposits are minimal, making it a solid choice for landlords looking to invest in the market.

6. Arizona

Arizona has become increasingly popular among landlords due to low property taxes (around 0.66%) and a fast eviction timeline; landlords can typically take action within five days of nonpayment. While the housing market has grown more competitive, the regulatory landscape remains favorable for landlords.

7. Ohio

Ohio offers a pro-landlord legal framework with few restrictions on rent increases or security deposits. Property taxes average around 1.52%, and evictions are relatively efficient compared to other states. The cost of entry is also lower than in many coastal or Western states.

8. Kentucky

Kentucky maintains a low cost of ownership with property tax rates around 0.86% and few bureaucratic hurdles for landlords. The eviction process is relatively quick, and there are minimal rent regulations, making it a good option for buy-and-hold investors.

9. Tennessee

Tennessee offers a fast eviction process (as little as 14 days in some cases), no state income tax, and no rent control. With property tax rates around 0.71% and steady rental demand, the state ranks high for overall profitability and ease of management.

10. Missouri

Missouri is another landlord-friendly state, with low property taxes (approximately 0.93%), limited rental regulations, and an efficient court system for evictions. Landlords in Missouri benefit from flexibility in lease agreements and minimal licensing requirements.

Final Thoughts: Invest Where the Laws Work for You

Understanding which states are most landlord-friendly can give you a major advantage when building or expanding your rental property portfolio. While every market has its unique challenges and opportunities, investing in states with favorable laws, lower taxes, and streamlined processes can help protect your bottom line and reduce stress in the long run. 

Whether you're a first-time investor or a seasoned landlord looking to diversify, being strategic about where you buy is just as important as what you buy.

Ready to explore landlord-friendly markets and get the ball rolling? Connect with an experienced, investor-friendly Evernest agent to get started today.