The Rise of Accidental Landlords in the Sun Belt
Sometimes people want to sell their house, but it does not work out. Maybe buyers are not interested, or prices are not right. When that happens, some homeowners try a new plan. They turn their homes into rentals and become “accidental landlords.”
A housing data firm called Parcl Labs looked at homes that were listed for sale and then switched to rental listings. They found this trend is growing in several Sun Belt cities. The Sun Belt is a group of states across the southern part of the United States. Many big companies that own lots of single-family homes have invested in this region. Those companies are called institutional investors. They often own more than 1,000 houses.
Parcl Labs says six Sun Belt metro areas hold about 37 percent of these large investor homes. The cities are Houston, Dallas, Phoenix, Tampa in Florida, Atlanta, and Charlotte in North Carolina. In five of these six cities, accidental landlords are becoming more common.
Houston saw the biggest jump. In April, 7 percent of failed sale listings turned into rentals. That was a 41 percent increase compared to last year. Dallas had 5 percent, which was a 32 percent increase. Phoenix and Tampa also rose, and Atlanta increased too. Charlotte was different. There, failed listings that became rentals went down by 7 percent.
Experts say the market has been tough for sellers recently. According to Realtor.com, de-listings rose by 57 percent in July compared to last year. That means more sellers took their homes off the market because they did not get the offers they wanted.
Why is this happening? After the pandemic, big investors moved into the Sun Belt because of job and population growth. But there are now more homes for sale and fewer buyers. So some regular homeowners who cannot sell decide to rent their place. They may hope to try selling again later. In the meantime, they want a tenant to help cover costs.
For renters, more homes on the market can mean more choices. For landlords, it means more competition. Accidental landlords are often new to renting, so they must learn how to set fair prices, find good tenants, and take care of repairs.
This trend shows how the housing market can change. When selling gets hard, people look for other options. In many Sun Belt cities, one option is becoming an accidental landlord.