Before buying a rental property, a landlord needs to check to if the market is in a rental-friendly state. When an investor fails to do his or her due diligence on this point, the result will have them wishing that they did. No one talks about the issue of checking to see if a rental is in a landlord friendly state— a scenario that can hit both newbies and experienced investors. Investing out of state brings with it a different set of challenges, and if you always look at the green grass on the other side of the fence, you may not acknowledge how good things are for you.
That Elusive Definition Of “Landlord Friendly State.”
What does it mean when I talk about “landlord friendly state?” This blanket term is used to describe cities and counties, within a state’s border, that swings in favor of the property owner on matters related to renting and tenants. What are the laws for that state regarding the eviction process? Some neighborhoods in certain states don’t allow you to buy a property and then rent it out. Other states, like Massachusetts, are harsh on landlords and lean for the tenant. Do your due diligence, so you are aware of what walls and hurdles you will face if you choose to invest between a particular state’s boundaries.
Unfriendly States Could Cost You LOTS
If you fail to do your research before hand, it will put your business and investments in a rocky place. Random lawsuits could arise, as well as financial issues. I know I’m painting a sad and serious picture, but it’s important to understand just how dangerous a situation can become when you don’t take the time to know a state’s landlord laws inside and out. Knowing these rules doesn’t need to be something that you do solely alone. Remember, that elite real estate investors build a team of people around them and partner up to leverage their success to a greater degree.
Research, Research, Research
Landlord Station named Texas, Indiana, and Colorado as the top three landlord friendly states, with Arizona and Florida also making the list. Buy and hold investors also need to take the time to analyze the county and city level also. There is a disruptive trend sweeping over several areas, and that is the limitation on the number investors, landlords, and tenants in any given neighborhood or city. Take the time, beforehand, to sort out all possible roadblocks and uninviting laws before jumping across the state fence.