Corporate Landlords Are Giving Small Landlords A Terrible Reputation

TAKE PRIDE IN THE RELATIONSHIPS YOU BUILD WITH YOUR TENANTS…AND SPREAD THE WORD

Yes, it’s true! There are some huge corporations out there that are scooping up rental properties that are for sale, jacking up the prices, and doing all they can to increase their bottom lines at the expense of renters. They have large amounts of capital and are able to outbid typical buyers and it’s not at all fair. However…that is not representative of the vast amount of property owners with rentals out there.

There are 5 big real estate companies that have become especially aggressive since the pandemic. The two at the top are Pretium and Blackstone, which own about 175,000 properties between them. That being said, it’s important to remember that only about 3% of rental properties in the country are owned by corporations. So while we want to be aware that big money is getting involved in ways we haven’t seen before, it’s very unlikely you’re dealing with them if you engage with a rental property.

LEARN MORE: WHY WALL STREET IS BUYING SO MANY U.S. HOUSEHOLDS?

WHO ARE RENTAL PROPERTY OWNERS?

Over 95% of rental property owners are people just like you and me. They’re teachers, carpenters, lawyers, fire fighters, nurses, doctors…they’re hardworking people who simply diversify their savings into real estate rather than a more typical 401K or stocks and bonds. They’ve got bills and mortgages to pay and are living in the same world as tenants. Many of our property owning clients were previously tenants themselves.

They know that real estate investment only works if you value your tenants and create respectful relationships. The relationship begins with simple transactions but successful property owners know that it’s really all about finding a balance that works best for all parties. There’s much more to it than just collecting rent. But…you’ll never hear about these positive interactions if your only interaction with landlords is through the news.

LEARN MORE: WHY WALL STREET IS BUYING SO MANY U.S. HOUSEHOLDS?

HOW DID LANDLORDS BECOME THE BAD GUYS?

It’s hard to believe that the COVID pandemic began over five years ago! As is a constant theme when money gets tight, tenants typically lose. To relive that era, with the world shutting down many people were out of work, income dried up, and more and more people were unable to pay their mortgages. Because it wasn’t the fault of the tenants, the government stepped in to stop evictions, which was good for tenants. However, now it was rental property owners who were stuck…and no one stepped in to put a pause to the mortgages they owed the banks. Landlords naturally were up in arms and became an easy target. This again, is pretty typical, as economic hardship very often erodes those in the middle: the bankers at the top were fine and protected…the tenants at the bottom had temporary protection, but the middle man was stuck. And naturally, we needed to do all we could to advocate for ourselves, but that was easily translated into “landlord greed”.

At that time, it became trendy for the media and politicians alike to blame the long accruing issues in housing on greedy landlords. And here we are…

LEARN MORE: UNDERSTANDING THE RECENT TREND IN ANTI-LANDLORD LEGISLATION ACROSS THE U.S.

NOW WHAT?

Unfortunately that trend continues, especially in tenant-friendly states like those in the northeast. Many of these states have liberal majorities in elected office and while most everyday democratic voters aren’t looking to stick it to their property owning neighbors, there’s little organized resistance or even awareness when bills that target landlords arise.

LEARN MORE: NEXUS VP/GM GREG RICE SPEAKS OUT AGAINST LEAD LAWS AT RI STATEHOUSE

THE ACCELERATOR CAN ALSO BE THE ANSWER

Americans have never been more reliant on social media and much of this grew out of those months in 2020 when we were stuck in our homes. While that period and change in how people relate to each other helped incubate much of the fervor out there aimed at landlords, increased social media presence can also allow rental property owners to organize and stay informed where very little related to landlord-related legislation would typically crack the front page of paper or appear on the local news.

It should be easy to search and connect with those in your community who are also being affected by these changes so that collectively, you can be part of the solution.

LEARN MORE: RICOHP IS CALLING ON YOU TO BE A LANDLORD AMBASSADOR!

CONCLUSION AND NEXT STEPS:

Nexus Property Management® has been partnering with rental property owners for over 11 years and now has franchise offices in four states. We are committed to the principles that helped our Rhode Island office grow rapidly and the most essential is the focus on long term results. Our clients come to us with varying degrees of experience and the vast majority become effective investors in no time. Reach out to the Nexus team closest to you.

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Mick Lefort is the General Manager of Nexus' New Haven County Franchise Office and the Vice President of Operations for Nexus Property Management®, a National Property Management Franchise that manages all types of rental property from single family homes or condos to large apartment buildings and complexes.

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