What Investors Need to Know About 2025 Rental Markets 

With a new year ahead, many real estate investors are considering ways to expand their portfolios and maximize returns. The high cost of home ownership means that more people opt to rent rather than own their homes. Given interest rates and home prices, the supply of renters will likely remain strong throughout the year. 

Buy-and-hold investors can continue to benefit from this. Investors who can find ways to buy at a discount can also benefit from stable rental markets across the country. 

To help you get the most out of your rentals this year, here’s a look at some industry trends and markets that are expected to see above-average growth in 2025. Once you’ve found a good property, visit ezLandlordForms.com for all the tools you need to self-manage your rentals. 

What to Expect from Renters in 2025

To maximize rental property returns, it’s helpful to pay attention to rental trends and shifts to what renters are prioritizing in housing. 

Here are three trends investors should be aware of in the year ahead. 

• Work-from-home amenities continue to be a priority. Despite the movement to return to the office, many tenants continue to work from home at least a few days a week. Tenants who work from home want more space in the property and have more flexibility when it comes to location. 
• The rise of GenZ renters in the market has led to increased demand for flexibility and technology in renting and property management. For example, renters want digital payment options, online management platforms, and smart technology in the rental. 
• Affordability continues to be a priority. The largest segment of renters are 20 to 34 years old and over 65. Both groups are looking for affordable ways to get the space and amenities they want. 

Rental Markets to Consider in the Year Ahead

We have a preference for investing close to home. Our team likes to self-manage rentals as a way to maximize returns, ensure quality tenant screening, and keep rental properties in good condition. That said, we know that doesn’t make sense for all investors. However, the closer to home you can invest, the easier it is to self-manage your rentals and keep an eye on your properties. 

With that in mind, we’ll focus less on specific markets and more on trends that investors should pay attention to when researching markets. When searching for new markets, investors should consider: 

• Job growth
• Rental demand
• Population growth
• Affordability 
• Rental income
• Tenant default rate 
• Rental laws and regulations 
• Sustainability trends 

In addition to considering those factors, here are some areas that are expected to have strong rental markets with rising rental prices in 2025. 

Sunbelt Cities

Sunbelt cities are increasingly popular with investors and renters due to the climate, growing economies, and below-average cost of living. The growing population in these markets means that rental markets are expected to see above-average growth in 2025. 

Some markets to consider in this region are: 

• Birmingham, Alabama 
• Nashville, Tennessee 
• Dallas/Fort Worth, Texas

Small Suburban Markets 

In addition to sunbelt cities, investors should consider small, suburban markets. These areas saw significant growth during COVID-19 and have seen steady growth over the last couple of years.

Remote work has fueled this movement towards areas with lower costs and more space. Smaller markets close to urban areas are seeing particularly high growth. Markets to consider in this category are: 

• Frisco, Texas
• Overland Park, KS 
• Lakewood, CO 

Tech Hubs 

Technology hubs continue to be a good location for rental properties. These areas have above-average incomes and offer a steady flow of young professionals looking for long-term rentals. 

Thriving tech hubs with strong job markets and rental demands mean good cash flow and appreciation for investors. Investors who prefer higher-value rentals can do particularly well in these markets. 

Tech hubs to consider for rental properties this year include: 

• Seattle, WA
• Austin, TX
• Raleigh-Durham, NC 

Affordable Midwest Markets 

As affordable housing becomes increasingly important to renters and homeowners, more people are moving to midwest cities. These cities are seeing increased rental demand from young professionals and young families in search of areas with affordable living. 

Markets to consider in this category are: 

• Wichita, KS 
• Milwaukee, WI 
• Cleveland, OH 

Partner With ezLandlordForms 

Good luck expanding your rental business in 2025. As you do, we’re here to help you through every step of the process. We have all the tools you need to self-manage your rentals and scale your business. 

From tenant screening to lease creation to rent payments, we’ve got you covered. Create an account today to get the most out of your real estate investments.