Landlords play a key role in the housing economy, owning and managing rental properties for their tenants. In this article, we’ll dig into 29 insightful statistics about landlords and the properties they own.
1. 10.6 Million Americans Earn Income from Rental Properties
Approximately 10.6 million American tax filers declared rental income when they filed their taxes. That means about 7.1% of 1040 filers could potentially be landlords.
Additionally, they noted income earned from about 17.7 million properties.
[Source: Internal Revenue Service]
2. Landlords Have an Average Income of $97,000 a Year
While landlords might bring in cash from several sources, their income levels tend to be solid. While the real median household income is just shy of $62,000, landlords bring in closer to $97,000 annually through all of their income sources.
[Source: US Census & Landlordology]
3. “Mom and Pop” Landlords Own 20.5 Million Rental Units
Of the approximately 50 million rental housing units in the United States, around 41% of the rental units are owned by mom and pop landlords, also known as individual investor landlords. That means approximately 20.5 million units are overseen by mom and pop landlords.
[Source: JP Morgan Chase]
4. The Average Landlord Has Three Properties
On average, landlords have three properties to their name. The value of those properties isn’t necessarily through the roof: 40% of landlords own less than $200,000 worth of property, and an additional 30% fall in the $200,000-$400,000 range. Only 30% of landlords own properties worth $400,000 or more, with 7% at the top owning properties worth $1 million or more.
[Source: MySmartMove]
5. Half of All Landlords Manage Their Own Properties
45% of landlords manage their own properties – just north of the 44% that don’t manage the properties they own, instead hiring someone or outsourcing property management to a third party. The remaining 11% consists of landlords that manage, but don’t own their properties.
On average, landlords have three properties to their name. Of those who own the units, it’s about a 50/50 split when it comes to just being the owner and handing management over to someone else, or owning while also managing the properties.
[Source: MySmartMove]
6. 25.8 Million Rental Units Are Owned by Businesses or Partnerships
Many rental properties aren’t owned by individuals or families. Instead, businesses, collectives, and similar entities control the units.
In total, approximately 25.8 rental units are owned by some kind of business entity. Usually, the units are in multi-family properties, like apartment buildings.
[Source: US Census]
7. The Largest REIT Owns 115,000 Rental Units
Real estate investment trusts (REITs) make it possible to invest in a wide range of properties to earn a profit. Typically, the REITs aren’t just owners of the properties; the trust manages them, too. As a result, the trust can become a mega-landlord, overseeing hundreds or thousands of properties.
One such trust – Starwood Capital, a REIT headquartered in Miami, Florida – is the largest REIT in the United States. In total, it had 115,000 units to its name in 2022.
[Source: Statista]
8. Investor Home Purchases Plummet More Than 30% in Q3 2022
Post-pandemic, investors were scooping up available properties at a shockingly high rate. In Q4 2021, investors purchased 18.4% of the available inventory, representing around 80,000 properties with a cumulative value of $50 billion.
However, 2022 has been marred with uncertainty. Inflation, rising interest rates, and a potential recession on the horizon are slowing interest. During Q3 2022, there was a year-over-year decline in investor home purchases of 30.2%. They purchased approximately 65,000 properties or around 17.5% of all home purchases.
9. Half of Single Property Landlords Purchased the Property as a Primary Residence
When it comes to single property landlords, 50% of them didn’t initially buy it as an investment property. Instead, the unit began as their primary residence, later transitioning into a rental property.
[Source: Foremost Insurance Group]
10. Rents Increased More Than 24% on Average Between 2021 and 2022
Rent prices have risen dramatically since the pandemic. On average, the cost of renting one- and two-bedroom apartments increased by 24.2% between 2021 and 2022.
[Source: Credit Karma]
11. Landlords Have Raised Rent Rates an Average of 31% Since 2010
Since 2010, rental rates have gone up dramatically. The average increase comes in at 31%, a rise that would give a property that was rented out for $1,000 a month in 2010 a cost of $1,310 a month today. That’s an additional $3,720 in rent a year.
[Source: iPropertyManagement]
12. During the Last Decade, Rent Increases Outpaced Wage Inflation by 270%
Pay rates have risen over time, but not at a rate that compensates for many cost increases. When it comes to rent, the average yearly increase has outpaced the average annual wage inflation by a shocking 270%. Rent inflation has also exceeded currency inflation by a startling 40.7%.
[Source: iPropertyManagement]
13. 48.7% of Landlords Have Asked a Tenant to Leave Early
A tenant’s lease usually dictates how long a tenant has a right to stay in a property, suggesting they don’t break the rules. However, 48.7% of landlords have actually requested that a tenant break their lease and head for the door sooner.
[Source: Porch]
14. Evicting a Tenant May Cost a Landlord Up to $10,000
When tenants don’t pay rent, landlords are down a source of income. At times, they may even be losing more money if they have to handle costs associated with the occupied property without getting rent in return. As a result, when non-payment is an issue, many landlords start eviction proceedings in hopes of getting the non-paying tenant out and a paying tenant in.
However, choosing to evict a tenant can be a costly move. Eviction filings and proceedings can cost landlords up to $10,000. Even the least expensive eviction can run $3,500.
[Source: SmartMove]
15. Post-Pandemic Total Rent Debt in the United States is Over $15 Billion
During the pandemic, eviction moratoriums prevented landlords from evicting tenants that fell behind on rent, leading to a start rise in rent debt totals. While the number of households behind in rent payments is below peaks of about 19%, approximately 5,843,000 households aren’t current, owing a combined total of around $15.13 billion.
[Source: National Equity Atlas]
16. Around 85% of Renters Have Paid Mom and Pop Landlords in Full Each Month Since the Pandemic
The pandemic led to significant financial struggles for many tenants, causing some of them to fall short of paying their rent in full since early 2020. Since January 2020, rent to mom and pop landlords was paid in full no later than the end of the month about 85.4% of the time.
[Source: Urban]
17. Individual Landlords Collect $34,217 a Year on Average, and Pay $23,679 in Expenses
On average, individual landlords reported $34,217 in rental income in 2018. However, they also reported $23,679 in deductible expenses on average, not including depreciation. That leads to a profit of just $10,538 per year, a profit margin of just 30.8%.
[Source: Fortune]
18. The Average Property Value of Single-Family Investment Properties Is $365k
Overall, the average property value of single-family investment properties is below the average value of single-family owner-occupied homes. For rentals, the average value in 2022 was $365,313, while owner-occupied single-family properties had an average value of $413,988.
[Source: Arbor]
19. Approximately 6% of Rental Properties Are Unoccupied
While the exact number of vacancies varies over time, approximately 6% of units were considered vacant as of Q3 2022. Generally, the vacancy rate is influenced by a few factors, including existing economic conditions and the strength of the housing market.
This is far less than the most recent peak, which reached 11.1% in Q3 of 2009. It’s actually fairly close to the recorded low point, which was about 5% in the late 1970s and early 1980s.
[Source: FRED St. Louis Fed]
20. Landlords Screen an Average of Two Applicants Per Vacancy
Renting out a property isn’t first-come, first-serve in many cases. Instead, landlords screen an average of two applicants every time they need to fill a vacant property.
[Source: MySmartMove]
21. Only 89% of Landlords Cover Property Repair Costs
Not having to worry about property repairs is one of the biggest draws of being a tenant. However, not all landlords handle that burden.
While the vast majority (89%) of landlords take care of property repairs, 11% don’t. That means tenants get stuck maintaining the house or apartment.
[Source: Porch]
22. Landlords Handle 6 Repair Calls a Year from Tenants
On average, landlords field six calls a year from their tenants about property repairs. This can include anything from major appliance failures to plumbing draining issues.
[Source: Porch]
23. 13% of Landlords Change Lightbulbs for Their Tenants
Replacing a lightbulb might seem like a small cost that most tenants could shoulder. However, 13% of landlords actually handle that burden after being contacted by a tenant.
[Source: Porch]
24. Landlords with Up to 4 Units Average $383 to $450 in Expenses Per Unit Per Month
The cost of operating rental units is often higher than people would expect. For individual landlords with properties with four or fewer units, the average annual per-unit cost typically falls in the $4,600 to $5,400 per year range. Broken out, that’s around $383 to $450 per month.
[Source: Brookings]
25. Two-Thirds of Landlords are College Grads, and More Than Half Are 35+ Years Old
Overall, 66% of landlords graduated from college. Additionally, 56% are at least 35 years old.
[Source: MySmartMove]
26. 75% of Landlords Want Rent Payments on the 1st
While there’s no rule saying exactly when a landlord has to collect rent, 75% of landlords say the 1st of the month is when they require payment. While it isn’t clear why in the survey, by having all tenants pay on the same day, it creates consistency. Plus, many kinds of government benefits issues payments on the 1st, so that could also be a factor.
[Source: Landlordology]
27. 78% of Landlords Accept Personal Checks
Paying by check is increasingly becoming antiquated, falling out of favor for retail shopping, and even paying many bills. However, when it comes to rent, 78% of landlords collect personal checks from tenants.
Only 10% rely on bank-to-bank transfers, and a mere 7% use payment services like PayPal or Zelle. One surprising option is credit cards, a payment method that 5% of landlords use.
[Source: Landlordology]
28. 41% of Properties Experience Some Form of Vacancy Every Year
During a typical year, 41% of properties experience some kind of vacancy. A vacancy could be caused by tenants leaving at the end of a lease, due to an eviction, or by breaking the lease early. Additionally, other incidents that require the unit to be empty, such as catastrophic damage that makes a property unlivable for a time, could also be involved.
[Source: Foremost Insurance Group]
29. 16% of Landlords Don’t Run Criminal Background Checks, and 10% Never Check Credit
While it may seem like a standard screening tactic, 16% of landlords never run criminal background checks on their tenants. Possibly more surprising is that 10.3% don’t check a tenant’s credit as part of the process.
Only 37.6% and 38.7% of landlords always check a tenant’s criminal background and credit history, respectively.
[Source: Porch]
30. 30% of Individual Investor Landlord Households Are Low-to-Moderate Income, Making Less Than $90,000
Among individual investor landlords, approximately 30% fall in the low-to-moderate income brackets. In total, their households earn less than $90,000 per year.
[Source: Brookings]
31. Among Landlord Households Earning Less Than $50,000, Rental Income Represents 20% of Earnings
With lower-income landlords, rental income is often a significant percentage of their household earnings. Among landlords with household earnings under $50,000 annually, around 20% of their income comes from rent payments. In comparison, among households earning more than $200,000, rental income typically represents just 5% of their total household earnings.
[Source: Brookings]
32. Landlords Operating 2-to-50-unit Buildings Provide Most of the Affordable Housing Stock
When it comes to affordable housing, landlords operating 2-to-50 unit buildings are the most likely to fill that niche, providing most of the affordable housing stock in the country.
[Source: JP Morgan Chase]
33. Loan-to-Value Rates on Single Family Rentals Sit at 65.5%
A loan-to-value rate compares the amount borrowed versus the value of a property. For single family rentals, loan-to-value rates have been dropping, indicating that landlords have far more equity than in years past.
Overall, loan-to-value rates on single family rentals declined to 65.5% in Q3 2021. That’s just slightly below the Q2 2021 figure, though it’s notably above Q1 2021 and Q4 2020.
[Source: Arbor]
34. Cap Rates on Single-Family Rentals Average at 5.3%
A cap rate is an annual metric that divides the operating income of a unit against its assessed value. For instance, if a property was worth $400,000 and it generated an annual income of $20,000, the cap rate calculates to 5%.
As of Q3 2022, the average cap rate on a single-family rental was 5.3%. Generally, anything above 4% is considered good in high-demand areas, which are considered lower risk. For low-demand areas, which represent higher risk, 8% or above is usually viewed as safer, though most prefer a cap rate above 10% in low-demand areas.
[Source: Arbor]
35. Property Managers Have a Median Pay Rate of $59,230 per Year
Many property owners choose not to manage their rental properties personally. Instead, they turn to property managers to handle day-to-day operations, including screening applicants, collecting payments, and addressing tenant-related issues.
While landlords have an average income of $97,000, property managers typically earn far less. The median annual salary is closer to $59,230. The lowest-earning 10% make less than $30,740, while the highest-earning 10% make over $124,680.
[Source: Bureau of Labor Statistics]
Bottom Line
The world of landlords is always changing. Economic conditions influence the success of landlords, as well as the general public’s interest in becoming homeowners or remaining renters.
The statistics above showcase some of the most intriguing tidbits about the landlord landscape, including how many people didn’t buy a property with the intent of being a landlord, the typical demographics of a landlord, and more. It’s a diverse area – one that features a mix of people and businesses – and one that’s important for understanding both the housing market and the economy in as a whole.
