The Landlord Lens - Accidental Landlords Are Taking Over The Housing Market

Episode Date: August 1, 2025

Accidental landlords are reshaping the rental market without even trying. With high mortgage rates and low inventory, more homeowners are renting out properties they never meant to. In this video, we break down why this trend is exploding and what it means for renters, investors, and the future of housing.

Small landlord taking a bigger stage, especially on single-family rentals, is how the American house market is designed to function. We shouldn't be just increasing just to make more profit, and especially if that's coming from these larger investors that have so much money. Accidental landlord. Whoopsies. Hey, everybody. Welcome to another episode of Landlord Lens, joined by a special guest this week. Jess Pliny. How are you, Jess? I'm doing great. How are you, Josh? I'm doing just spectacular. Yeah, it's a great Wednesday today.

It's a hot one, though. Indeed, it is. Cool. Today we've got a topic that is being discussed in a lot of different places. Yahoo Finance is talking about it. CNBC is talking about it. Bigger pockets did an episode about it. And that is the accidental landlord.

Whoopsies. Jess, what is an accidental landlord? So an accidental landlord is somebody who ends up renting out their property without originally intending to become an investor. So think, you know, people who moved during the pandemic for remote work, people who maybe inherited a property, you know, maybe moved in with a partner. These aren't situations where they meant to make money from renting out their home. It's, you know, people who are doing it for for natural reasons. You're one of those, right?

I am one of those, apparently. I had not heard that definition or the term until this week, but I guess I match that. Yeah, and apparently it's more prevalent in the sunbelt here, and let's roll a clip about one of these accidental landlords CNBC interviewed. Mr. Garrett Johnson. I expect to hold it until the market recovers whenever that is. I don't expect for it to recover super soon. So, you know, the expectation is that it'll be several years. Okay, Garrett, so you got out because the market was a little bad. You couldn't get the price you wanted. How did you get into it, Jess? Yeah, John, so I bought with my husband in 2018, very beginning of 2018, we moved into a condo in Denver. And, you know, we were there for five years, absolutely loved it. But when it came time to start a family, you know, Denver prices are a lot higher than you would get in the suburbs, right? So we reluctantly moved to the burbs. But don't knock the burbs. I live in the burbs. I know. We actually live in the same neighborhood. I actually love it now. It took some adjustment. But, you know, at the time, we looked at selling. However, we had, like many accidental landlords, we had refinanced during the pandemic. So we had, you know, sub 3% interest rate. And when we were looking at, you know, homes starting to sit for longer on the market, including our neighbor who was trying to sell. It was three months in. Nothing. We decided, you know, we're only going to be. be 15 minutes away, why don't we try renting our property out? And we have for the last three years.

And it's actually worked really great for us. We've had, we had the same tenants for two years. They then moved to the mountains. We got new tenants. And, you know, it's been a really stable source of not so much income, but stability for being able to pay off that mortgage while we're in a home that we can raise family. That makes sense. So you moved more for, or you kept it, I should say, more for the fact that you had that great rate. Yeah. And it wasn't exactly the seller's market that it was in 2021 when you were. Right, right.

Things were starting to turn. We closed on our current home in October 2022. And that was just before the interest rates kind of shot up to 7%, where they have been now for coming up on, what, three years. Gotcha. And you heard Garrett talk about right now, the market. especially in a lot of Sunbelt cities, has dropped, right? All these rent prices and housing prices are slipping and time on market's increasing for listings.

And so he said, I'm going to hold this for probably a couple years because I don't see it recovering for a while. And this is a, so it's interesting now because way more people in the Sunbelt are doing this. It's actually having an impact on the market. Yeah, it is. And it's kind of interesting to see this trend, too. like if you look at some of the macroeconomics along with it, we had, you know, during COVID, people were working from home. A lot of people were moving out to the Sunbelt states. So, you know, it's interesting. Bigger pockets covered this really well. A lot of those areas,

those states that were talking about really seeing an impact are places where people moved. And now the market is somewhat correcting itself. I mean, it's bad news in a lot of ways for these accidental investors because they want to go out and just get the price and sell it and move into the next primary, right? But it's especially, let's say, complicated news or a strategy changing news for the large institutional, those Blackstones, Invitation Homes, and others who've been writing this single family way for so long. Yeah. Yeah. And it's really interesting to see, you know, more of the mom and pops and situations just like mine start to take effect. And I think it's really interesting, too, if you look at your millennial, right? Yep, I sure am. So am I. I am seeing this

this trend even amongst my own friend group where a lot of, you know, others also bought a starter home, whether that was a small apartment or a small house. And now they're starting to have families. And, you know, I'm seeing a lot more of that trend, too, where they are now renting out their first home. They're staying either nearby or maybe they're moving closer to be with family because of the cost of sort of everything else also going up and making it a little bit more difficult to, you know, be financially successful. Yep. So now it's a lot more likely, especially in these Sunbelt cities, if you're moving into a single family home rent, your landlord's a lot likely, much more likely to be, you know, a millennial young family living down the street maybe

than a private investor or a Black Rock or Progress residential kind of company. Right, right. And I think the intentions of that are different too, because like in our case, we just want to, break even, maybe make a little bit to cover things like the cost of our son daycare. We're not necessarily looking to make a profit. We might increase our rent as other things go up. So we're also part of an HOA. A lot of the fees associated with the different services are also going up. So that's a consideration too is, you know, if you do become an accidental landlord,

there are things that you need to sort of stay on top of, including your, you know, your state laws. make sure, like, in Denver, apparently you have to be registered as a landlord in some senses. So, you know, it's important to really go into that with the right frame of mind. It's not a totally hands-off thing by any means, but there are, you know, tools like ours at TurboTenant that can help you. Yeah, I think that what you called out there about the fact that you're trying to cover costs, pay the mortgage on it until the market's such a place that you can sell it. Totally different playbook. than the Black Rock's invitation homes and everything, right?

They've been enjoying for the last five years, 5% rent increases, I think CNBC said, on average on renewals, right? So these rent control laws have been targeting them, not the small landlords they accidentally affect. I think the small landlord taking a bigger stage, especially on single family rentals, is how the American house market is designed to function. These folks like invitation homes that were in the market from 2020 onward

and especially bought in 2020, 21, and those eye buyers and stuff, they're really taking advantage of a market that had really low interest rates that they could anticipate significant rent increases. And so every asset they bought, they knew they were going to be able to raise rent 5% or more every single month,

raise the ire of all the politicians, right, to hate all landlords, which caught all of our users in that backlash. And so you had these people who were entirely motivated by the profit motive pushing, you know, Higher rents, higher rents, higher rents, independent of the actual cost of living situation in the country.

And it was, you know, making folks like you less relevant, I would say, right, in the market. Who's just trying to cover cost and raise a family. Right. Right. You don't have a fleet of lawyers behind you in New York City or something. So I'm glad about this. I'm glad like CNBC said they're actually net sellers in a lot of markets. These Black Rocks are net sellers.

And that's great news, I think. I think that's great news for the American housing market. Yeah, I mean, I think so too. And you hit the nail on the head. Like these sorts of investors, these larger investors, aren't in it to help their community. They're not in it to, you know, just cover the basic costs. And maybe you make a little bit extra to cover in our case our child's daycare because those costs are going up too. You know, I think it's a good thing when you can have that direct relationship with your tenants.

we've had nothing but good experiences. And I think like that speaks to what it honestly should have been in the first place. I don't think it's about squeezing every extra cent out of a renter or, you know, setting other people up to fail when it comes to being able to buy their first home. You know, I think like Gen Z, for instance, they're kind of in a, they're in a rough spot. We shouldn't be just increasing just to make more profit. especially if that's coming from these larger investors that have so much money to begin with, I think it's a really good thing that we are on, you know, more of this trend of these accidental landlords doing it and becoming landlords because it makes sense with their life.

Absolutely. So I think what this means for you at home, if you're watching, and you're thinking about moving, maybe you've got a first, second, third kid on the way and wondering how all those bedrooms are going to fit. And you're looking at the market a little worried. You're thinking, well, I've got a 3%. What do I really do here? I recommend you really assess your options. Really take a look at, you know, build out some models, five, six, seven years from now.

And if you sell now versus rent now and potential prices of that home in five, six years, and it might actually be the economical decision to hold on, especially if you have faith in the American housing market. Yeah, absolutely. All about having faith, which can be hard in a market that has a lot of twist. and turns. So we talked about accidental landlords. You might be one soon. You might be thinking about becoming one soon. If you are, sign up for TurboTenant. Like and subscribe for more content as we talk about the housing market for small landlords like yourself or like you might be one day. Jess,

thank you for coming on. Thank you so much for having me. It's been fun. TurboTenant is the all-in-one platform for landlords to manage their rental properties. From vacancy to tenancy, we have you covered with industry-leading tools and expert advice. Landlord better from anywhere for free at turbotenant.com.