Are Accidental Landlords on the Rise? Tampa Property Management Insight

If you’ve found yourself in the position of an accidental landlord, you’re not the only one. We all know accidents happen, but it may come as a surprise that accidentally owning a rental property has become more common than you might think. 

As of 2024, accidental landlords are on the rise. At The Listing Real Estate Management, we want to help guide accidental landlords through the property management process — we know it can be challenging and sometimes worrisome. We are here to assure you that if you enjoy earning a passive income, becoming an accidental landlord may be one of the best things that can happen to you. 

Keep reading to find out more about the cause of accidental landlordship and what to do if you find yourself in this situation.

What is An Accidental Landlord?

An accidental landlord is exactly what it sounds like — a person who accidentally becomes a landlord of a rental property without the intention of doing so. An accidental landlord acquires a rental property unexpectedly, not as an investment decision or with the intention of managing a rental. 

How Does Someone Become an Accidental Landlord?

As Tampa property managers, we’ve heard the question “How does someone just accidentally become the owner of a rental property?”. Well, the answer to these questions varies depending on each situation; there are multiple ways in which a person acquires a rental property. Becoming an accidental landlord can be the result of various situations including, but not limited to:

• Difficulty selling
• Inherited property 
• Relocation
• Upsizing or downsizing
• Temporary housing needs

Whether it’s because you can’t sell your home, or because you accepted a job across the country and need to move immediately, becoming an accidental landlord is an incredibly profitable opportunity. 

Are Accidental Landlords on the Rise?

The state of the real estate market in 2024 has led to an increase in accidental landlords across the country, especially in Florida. If you’re inexperienced in real estate and rental properties, we know it can be difficult to navigate the changing climate of the industry to make decisions regarding your property as a homeowner. 

The state of the real estate market relies on a few essential factors:

• Interest rates
• Rent prices
• Employment rates
• Evolving preferences 

As interest rates are high and the current real estate market is slow, homeowners are struggling to sell their homes at the desired asking price. Instead of selling the home for a lower price or taking it off the market completely, homeowners are choosing to rent out their homes, making them accidental landlords.

Pros and Cons of Becoming an Accidental Landlord

Like any situation that involves the owning, transaction, or renting of real estate, there are pros and cons to becoming an accidental landlord. Although I believe the pros outweigh the cons, owning a rental property should not be taken lightly. It is essential to consider all aspects of the process and determine if owning a rental property is right for you, or if you should proceed with selling the home.

Pros

Additional Income

The most significant benefit of suddenly becoming an accidental landlord is the opportunity to earn an additional income. As a property manager, I’ve yet come across a Tampa rental property owner who doesn’t enjoy the additional cash in their pocket every month.

If your acquired property is in the Tampa Bay area, you’ve hit the accidental landlord jackpot. Not only is the rent significantly higher in Tampa than other regions throughout the United States, but 50% of properties are renter-occupied. That means you have a population of over 76,000 people who may be interested in occupying your rental property. 

Property Appreciation

It may be safe to assume that as an unintentional rental property owner, you’ve considered selling the property eventually. I advise against selling your property immediately, and in 10-15 years you will come back and thank me for this advice. 

The longer you hold onto this accidentally acquired property, the more it will increase in value. If you read this article from 2015 about average Florida home prices, you’ll find that you could expect to purchase a house for a little over $200,000. In 2024, the average Florida home value has doubled, currently coming in at $402,000.

Following the historic pattern, in ten years from now your property will have significantly increased in value. Whether you purchased your current property or it was handed down to you, you will earn a significant profit if you choose to hold off and sell your home later down the line.

Passive Income

Is there anything better than earning an additional income? Yes, earning a passive income! Working with a professional property manager will allow you to earn both an additional income and a passive income.

A passive income is an income earned without doing any work. In the case of owning a rental property, the only possible way to earn a passive income is to hire someone else, a property manager, to do all of the work. Managing and running a successful rental property takes time and dedication, two things that some people just don’t have.

Even if you’re inexperienced in owning a rental property, or simply don’t want to deal with tenants or maintenance issues, this opportunity can be a profitable and successful venture. A property manager will take over all aspects of property management from start to finish, leaving you with no work and money in your pocket every month.

Becoming an accidental landlord can be scary but it doesn’t have to be. At The Listing, we have years of experience helping accidental landlords turn the headache of acquiring a rental property into years of additional income, and sometimes the desire to expand their investment portfolio. 

Real Estate Investing Experience

Whether you decide to work with a property manager or run this newly acquired property on your own, doing so will give you real estate investing experience. Although accidental landlords don’t intentionally invest in their rental property, owning and operating a rental is an investment experience in our book. Hey, you invested your time and effort, right?

Some accidental landlords turn into real estate tycoons — once you realize the power of owning real estate and begin building wealth, there is an opportunity and desire to diversify your real estate portfolio.

Working with a property manager who truly cares about your success and treats your property as their own can set the stage for a lifetime of wealth. Many of our property owners own several rental properties and entrust us to manage the daily operations of each one of them, allowing our owners to earn a large passive income with a stress-free and hands off approach.

Cons

Unexpected Responsibilities

Unexpected responsibilities are the most common complaint of becoming an accidental landlord, and we totally understand. As a property manager, I can attest to the fact that the responsibilities that come with running a successful rental property are extensive. From finding a reliable tenant, to making sure your appliances are functioning properly, to handling a tenant’s emergency inquiry, some accidental landlords become quickly overwhelmed.

When the responsibilities begin to pile up, an accidental landlord usually makes one of two decisions; sell the property, or hire a property manager and begin earning a passive income. If you are able to keep your rental property, I highly recommend doing so as earning an additional income, increasing your equity in the property, and property appreciation benefits are valuable aspects of doing so. 

Tenant Issues

Tenants can make or break the success of your rental property; your Tampa rental only generates an income if you have renters living there. There are essential steps to ensure your tenants are reliable, satisfied, and renew the lease agreement. 

Tampa rental property owners who do not utilize an in-depth tenant screening process may face issues with their tenants. At The Listing Real Estate Management, we use a multi-step tenant screening process that ensures all tenants are reliable and have a healthy financial situation.

Accidental landlords can benefit from our tenant screening process to avoid future tenant issues. This process includes:

• Credit history check
• Debt to income ratio
• Nationwide eviction search
• Background check
• Income and employment verification 
• Previous two years rental verification 

Property Maintenance

Property maintenance can be a difficult task to tackle as an accidental landlord if you don’t have much experience or time. Whether it’s replacing an air conditioner or fixing a burst pipe, failing to fix a repair in a timely or efficient manner can cause damage to both your property and your tenants’ satisfaction.

Working with a Tampa property management company relieves the stress of having to deal with any maintenance issues. At The Listing, we work diligently with our property owners and licensed vendors to ensure all maintenance is completed professionally and with accurate pricing. We only work with the best vendors to ensure complete satisfaction.

Our required property management maintenance reserve, a separate account dedicated to funds for maintenance repairs, allows us property managers to handle emergency and routine repairs throughout the tenancy. This way, funds are readily available throughout the lease term and we can take care of each repair without bothering our property owners.

Should I Hire a Property Manager as an Accidental Landlord?

If you don’t have the time or experience to assume responsibility for the daily operations of your Tampa rental property but want to continue earning an additional income, I highly recommend hiring a property manager.