High or Low Tax States - how do i find them

High or Low Tax States - how do i find them

Member since 2018 · 70 posts · 15 votes
Hi there -

I see a lot of posts about the following:-

1. high/low tax states
2. landlord/investor friendly states.

1. Where do you guys do your research to see and compare what states are high tax and low tax? And when you mention this, are you referring to PROPERTY taxes, income taxes, sales taxes, or an accumulation of all of the above? Is there a central statistics website that shows this info clearly and that can be trusted? All states pay the same federal rates I'm sure, so its down to state level only?

2. Where do you guys do your research to see and compare what states are landlord or investor friendly or not? Same as above, is there a central website that I'm missing? Or is this one based on opinions only? I see tons of posts about how peoples individual cities are booming and great places to invest, then only to see these cities way down the pecking order in terms of "best places to invest", etc.

If I were to give 1 example - Philly, PA! I see locals who i follow, appear to be crushing it here, but in the big picture, people say areas like this are a no-go! That the only place in the US to invest is Florida, Carolinas, GA, or TX!

Appreciate your feedback on this....


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Corby GoadeBusiness Member
Investor · Boise, ID · Member since 2014 · 3k+ posts · 3k+ votes
5y

Finding landlord friendly states is fairly easy- look at how they vote. By in large, red states are more landlord friendly, blue are more tenant friendly. You can dig in from there- the MOST red states are probably going to be the MOST landlord friendly. 

The dems and republicans would like you think that you could analyze taxes the same way, but I'd beg to differ!

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  • Corby GoadeBusiness Member
    Investor · Boise, ID · Member since 2014 · 3k+ posts · 3k+ votes
    5y

    Finding landlord friendly states is fairly easy- look at how they vote. By in large, red states are more landlord friendly, blue are more tenant friendly. You can dig in from there- the MOST red states are probably going to be the MOST landlord friendly. 

    The dems and republicans would like you think that you could analyze taxes the same way, but I'd beg to differ!

  • Investor · Lake Worth, FL · Member since 2016 · 233 posts · 140 votes
    5y

    @Colin M. At a high level you can look at income taxes, property taxes and sales taxes by state. There are 9 states that do not have income taxes including florida and texas but the property taxes are higher than many income tax states but not always.

    Landlord friendly is harder as not only does it vary by state, it can vary by county, city, and even judge. Overall very socialist states are tenant friendly while more capitalist states are generally landlord friendly.

    Fl, Tx, OK- mostly landlord friendly.

    NYC (NYS less so), NJ, CA, OR, WA - generally tenant friendly.

    Neither of these points, is enough on its own to determine where to invest. The question is the total return worth the hassle? Can I make a better return, easier else where?

    The key is learn your market and overcome the challenges. Every market has opportunities and challenges.

    I personally avoid NYC after dealing with their headaches for years.

  • Rental Property Investor · Portland OR · Member since 2018 · 2k+ posts · 3k+ votes
    5y

    i think you will find that in general tenant friendly equates to higher property values and higher rents....  that is usually why tenant laws get made - to stop the increase in rents (not saying rent control is good - just that is why it is done) I personally think it is better to invest where you know....  or in an area that is stable with a good economic base etc - even if that means higher taxes (better infrastructure - usually) and tenant friendly laws

  • Kevin MoyerBusiness Member
    Property Manager · Philadelphia, PA · Member since 2019 · 269 posts · 301 votes
    5y

    Another perspective: Greater risk = greater returns. Anyone can be a landlord in a friendly owner environment like Oklahoma, so you'll find mediocre returns. If you are willing to strap on a bullet-proof vest and buy a property in Philadelphia where landlords are essentially enemy combatants in the eyes of the city, you will be competing against fewer investors able/willing to take on the risk and find higher returns. Even within Philly I find D-Class and C-Class properties, if done correctly, have significantly higher returns than B or A Class units. If it's easy everyone does it.

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