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More Americans are becoming landlords for the first time, and they’re finding out the hard way what a pain it can be.
After a period of historically low-interest rates that led more people to buy second homes and get into the rental market, Zillow reported a 23 percent jump in the number of new landlords as of March 2023, according to a new report from the real estate giant.
That has led to a sort of wake-up call for some who are reporting it’s harder to give tours, screen renters and keep up with maintenance than they’d expected.
“Investing in a rental property can provide reliable income and housing for a renter who needs it, but it’s crucial for landlords to understand the responsibilities,” said Manny Garcia, a population scientist at Zillow. “Many landlords wish they had known more about the effort required to find tenants and keep the property in good condition.”
Most landlords said repairs and maintenance were among the most demanding responsibilities of managing their rentals, with 40 percent saying it was the most burdensome, according to the report.
That was a close second to screening tenants, which nearly 3 out of 4 landlords said was among their top three most burdensome activities. More than a third said they wish they knew how hard it was to find reliable tenants.
Landlords were most likely to report that a great tenant is one that pays rent on time. The next best attribute was a renter who maintains the home, according to the report.
Thirty-four percent said they wish they knew the leasing process, which includes providing tours to tenants, would take so much effort.
The report also gave some insights into the types of investors who are landlords in the U.S. today. The typical landlord has two rental properties.
Among first-time landlords, more than half have only one other rental property. Repeat landlords, who account for 75 percent of landlords, typically have two. Just 2 percent of first-time landlords report having five or more properties, according to the report.
Zillow used the report to tout its tools for landlords, including screening, lease support, payment support and an upcoming maintenance tracker.
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