{"id":181431,"date":"2025-03-05T13:53:58","date_gmt":"2025-03-05T20:53:58","guid":{"rendered":"https:\/\/www.biggerpockets.com\/blog\/?p=181431"},"modified":"2025-03-05T14:08:03","modified_gmt":"2025-03-05T21:08:03","slug":"the-rise-of-reluctant-landlords","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/the-rise-of-reluctant-landlords","title":{"rendered":"The “Reluctant Landlord” and How They’re Shifting the Industry"},"content":{"rendered":"\n

There’s a school of thought among many real estate investors that you should<\/span> never sell your property<\/span><\/a>. However, for some property owners, renting out their homes has not been by choice. A recent article in<\/span> Business Insider<\/span><\/a><\/em> revealed a scenario <\/span>that has been<\/span> happening throughout the Sunbelt in the wake of the return-to-office (RTO) mandates corporate America has been issuing to its remote employees. <\/span><\/p>\n\n\n\n

Envisioning that out-of-office work was here to stay, many employees purchased homes during and after the pandemic in warm areas with lower <\/span>costs of living<\/span> at sub-3% interest rates.  However, the call to return to company HQs has caused many workers to pack their shorts and flip-flops and leave behind their adopted balmy new towns and cities. The issue they face is what to do with their homes.<\/span><\/p>\n\n\n\n

Impossible to Sell<\/span><\/h2>\n\n\n\n

The real estate market now differs from when they purchased their remote working accommodations. Interest rates have doubled, and plenty of new inventory has come to market. The frenzied bidding wars of 2021 are long gone. <\/span><\/p>\n\n\n\n

According to<\/span> Altos Research<\/span><\/a>, there were 682,150 single-family homes on the market at the end of 2024, as opposed to 490,809 at the same point in 2022. <\/span>Simply<\/span> put, selling a 3% interest-rate property in the current market makes little sense\u2014thus, the rise of the reluctant landlord.<\/span><\/p>\n\n\n\n

According to National Association of Realtors (NAR) data,<\/span> 20% of repeat buyers<\/span><\/a> kept their prior residence as an investment, rental, or vacation property. Parcl Labs, a real estate analytics firm working with <\/span>Business Insider<\/span><\/em>, identified cities with the most single-family rental homes, unsurprisingly in the Sunbelt: <\/span>Tampa, Florida<\/span><\/a>; <\/span>Dallas<\/span><\/a>; <\/span>Charlotte, North Carolina<\/span><\/a>; and <\/span>Phoenix<\/span><\/a>, among others. Parcl Labs identified that <\/span>between<\/span> 3% to 8% of people who listed their homes for sale in September had become landlords by November. <\/span><\/p>\n\n\n\n

For many of the reluctant landlords featured in the <\/span>Business Insider<\/span><\/em> article, two main factors made listing their homes difficult:<\/span><\/p>\n\n\n\n