10 worst states to be a landlord (avoid these risky markets)

Juggling uncooperative tenants, costly repairs, and looming vacancies is a fast-track recipe for burnout. And in the worst states to be a landlord, strict regulations serve a dish that’s hard to swallow.

To help you steer clear of risky rental markets, TurboTenant analyzed key legal and financial factors, like steep property tax rates, strict rent control laws, and clogged eviction courts. Based on these findings, here are 10 states where owning rental property is harder, riskier, and less profitable.

Keep reading to see which states made the list, what makes them so challenging for landlords, and how to protect your investments, navigate restrictive laws, and avoid costly missteps in these high-risk markets.

Criteria for Ranking States

Every good list needs a solid set of criteria — here’s what was used to rank states:

Anti-landlord legislation: Some states feature legislation that favors tenants while presenting hurdles for landlords. A prominent example is the no-fault eviction ban, which prevents landlords from ending leases without cause.

Rent control laws: What landlord wants the state to tell them how much they can charge for rent? Rent control laws restrict when and how much landlord can increase rent, which limits their ability to adjust to market conditions or rising costs.

Eviction timeline and court backlog: States with slow, congested court systems or lengthy eviction notice requirements can leave landlords stuck with nonpaying tenants for months.

Property tax rate: Yearly tax bills that ravage revenue make it tough to turn a profit.

Rental yield: When rent barely covers the mortgage, taxes, and upkeep, landlords are stuck treading water until it's time to sell. Low rental yields make it tough to turn a profit, let alone save, reinvest, or expand your portfolio.

10. Connecticut

With a brutal 1.92% property tax rate (the third highest in the nation) and evictions that often drag on for months, Connecticut kicks off the list of the worst places to be a landlord in 2025. Considering investing in property here? Get ready to bleed cash and wait your turn.

Unfortunately, high property taxes are just the start. In the Constitution State, landlords can't even end a month-to-month lease without just cause. And while no statewide rent control law exists, several cities still cap rent hikes they consider "excessive," thereby tightening the screws.

9. Massachusetts

In Massachusetts, landlords can't charge a late fee until rent is more than 30 days overdue, leaving owners cash-strapped and wondering if they'll get paid. Add in the high cost of living and proposed rent caps in Boston, and you may want to reconsider being a landlord here.

Worse yet, eviction proceedings in Massachusetts can be a nightmare. One couple in Rockland spent two years and $80,000 trying to remove a non-paying tenant who trashed their property without ever receiving an apology from local officials.

8. Minnesota

Minnesota landlords are often left waiting when tenants fail to pay rent on time. To add insult to injury, they must issue a 14-day notice (or a 30-day notice in Minneapolis) before initiating the eviction process. Combine that with a capped 8% late rent fee, and tenants have little reason to pay on time.

While there's no statewide rent control, St. Paul (Minnesota's second-largest city) limits rent increases to just 3% a year, and Minneapolis has considered similar restrictions in recent years. These caps make it hard to keep up with rising costs, let alone grow a rental business.

7. Maryland

Speaking of strict rent control, Maryland’s two most populous counties, Montgomery and Prince George’s, cap rent increases at 3% plus inflation, or 6%, whichever is lower. With limits like these, it’s hard for landlords to justify investing in upgrades or property improvements.

On top of that, Maryland lawmakers are also pushing for 'good cause' eviction rules that make it harder to terminate leases without a qualifying reason. If passed, the law could force landlords to renew leases with problem tenants.

6. Illinois

Thanks to a 2023 statewide ban, Illinois landlords can’t turn down applicants based on how they pay rent, whether through housing vouchers, Social Security, or child support, even if they’ve had trouble collecting those payments in the past. It’s a gamble that property owners can’t opt out of.

Illinois could move even higher up this list if grassroots groups get their way and proposed rent control measures become law. Then, a significant backlog of eviction cases at the court level means that 2-year evictions are a very real possibility. Finally, high property taxes make generating a profit difficult. If you're considering becoming a landlord in Illinois, be sure to consider the decision carefully.

5. Washington

In 2022, a landlord in Bellevue rented his $2 million home to a serial squatter. Three years and over $80,000 in losses later, he still hasn't reclaimed his property, thanks to Washington laws that make it painfully hard to remove tenants who stop paying but refuse to leave.

To add to these legal headaches, statewide rent increase laws have recently been passed, just cause eviction rules make it hard to move on from tenants, and strict notice requirements add layers of complexity to the eviction process. Want to be a landlord in Washington? Best of luck.

4. Oregon

Washington's neighbor to the south, Oregon, enforces similarly restrictive laws that make landlording a tricky proposition for real estate investors. Want proof? Raise rent by more than 10% in Portland, and you'll owe your ex-tenant up to $4,500 in relocation fees.

To make matters worse, Oregon landlords can no longer access over 47,000 sealed eviction records (even though prior eviction is one of the strongest predictors of future issues), making it harder to screen applicants thoroughly. It's no wonder that so many landlords are investing their money elsewhere.

3. New Jersey

Although New Jersey has no statewide rent control, more than 100 local jurisdictions enforce their own ordinances, creating a complex spiderweb of legislation that can baffle even longtime Jersey landlords. While diving into the specifics would take a whole new article, New Jersey is easily one of the worst states to be a landlord.

In addition to income-squeezing rent control, New Jersey imposes the highest property tax rate in the country (2.49%), strict just cause eviction laws, and painfully slow court processes. Between the legal roadblocks and crushing costs, landlording here can feel like an uphill battle.

2. New York

If you thought New Jersey's rent control laws hinder landlords, New York's statewide regulations take things a step further. These rules erode profitability by locking in rent prices via either rent control or stabilization, which limits increases (even after significant improvements) and prevents landlords from resetting rent between tenants.

Furthermore, New York's 2024 "Good Cause Eviction" law requires landlords to have a legally valid reason to terminate a lease. Additionally, tenants can challenge rent hikes they dislike, leading to drawn-out legal battles and preventing rent from keeping pace with the market.

1. California

Like New York, California enforces strict rent control, capping increases at 5% plus inflation or 10%, whichever is lower. But what really puts California at the top of the list? Taxes. Rental income gets hit with California's steep income tax, up to a brutal 13.3%.

And if rent control and sky-high taxes weren't enough, California is also one of the toughest places to deal with squatters. One Encinitas homeowner spent two years and over $250,000 evicting squatters who signed a lease, trashed the property, and never paid a dime.

Thinking about becoming a landlord in California? Then you’d better be ready for rent caps, steep taxes, and the looming risk of squatters.

Tips for Managing Rentals in Landlord-Unfriendly States

These ten states make managing rental properties more challenging, but not impossible. With the right approach, you can protect your investment, limit risk, and stay one step ahead of strict regulations. Here’s how:

Know Your Local Landlord-Tenant Laws Inside and Out

One thing is true across all landlord-unfriendly states: The laws lean heavily toward tenants. To avoid costly mistakes, understand local rules, flag those that apply to your rentals, and use landlord-tenant guides to plan with confidence.

Screen applicants rigorously

Upstanding tenants are the foundation of any successful landlording operation. To find them, start by sending out non-discriminatory rental applications to filter out weak leads upfront via a prescreener. Then, run full credit, criminal, and eviction checks so you know exactly who wants to rent your place.

Lastly, interview serious prospects and verify their references by contacting past landlords to inquire about how the applicant treated the property, paid rent, and adhered to lease terms.

Create iron-clad lease agreements

Once you've found solid tenants, lock things down with a lease agreement that protects you and your rentals. Use property management software to create one with state-compliant disclosures, essential clauses, and enforceable terms that will withstand legal scrutiny.

Document all relevant tenant interactions

If you ever need to evict a tenant, don’t expect it to be easy, especially in any of the listed states. Your best defense against tenants you need to remove? Document everything. Whether missed rent, noise complaints, or lease violations, get it all in writing. Solid records can protect you in court and help speed up the eviction process.

Consider investing across state lines

If things just aren't working out, sometimes the smartest move is to invest in states where the laws favor landlords. Consider building a rental portfolio in landlord-friendly states and managing it remotely. And with the right landlord software backing your operation, you can screen tenants, collect rent, and handle maintenance from anywhere in the country.

This story was produced by TurboTenant and reviewed and distributed by Stacker.