Most Mom-and-Pop Landlords Lose Money—Here’s Why, and What to Do Instead

According to the media and average Americans, landlords are all rich, lazy leeches growing fat off of honest workers. It’s an easy narrative to spin. Too bad the numbers prove it’s not true in the slightest. Most landlords actually lose money. I did, back when I still bought properties directly. Here’s why so many landlords quit—and a few alternative ways to invest for the same cash flow, appreciation, and tax benefits without all the headaches and costs. Average Landlord Size What’s the most common portfolio size among landlords? To hear the media tell it, you’d think those evil landlords own entire blocks and neighborhoods. But a study by Doorloop found the most common portfolio size is exactly one unit (42% of landlords). That’s right: Most landlords own just one unit. Another 33% of landlords own two to four units (often a single property), and another 16% own five to 10 units. That means 91% of landlords own 10 or fewer units. In fact, a quarter of landlords never intended to own rentals in the first place. They became accidental landlords when they struggled to sell their home and ended up just renting it out instead. That’s hardly the stereotype of a rich, greedy landlord th...