<\/p>\n
Lisa Marshall is shown outside her rental property in Katy Wednesday, Sept. 30, 2026. Like many home sellers struggling to sell their properties these days, Lisa converted her property to a rental.<\/p>\n
Melissa Phillip\/Houston Chronicle<\/p>\n
The rental property of Lisa Marshall is shown in Katy Wednesday, Sept. 30, 2026. Like many home sellers struggling to sell their properties these days, Lisa converted her property to a rental.<\/p>\n
Melissa Phillip\/Houston Chronicle<\/p>\n
Lisa Marshall is shown poolside at her rental property in Katy Wednesday, Sept. 30, 2026. Like many home sellers struggling to sell their properties these days, Lisa converted her property to a rental.<\/p>\n
Melissa Phillip\/Houston Chronicle<\/p>\n
The pool waterfalls are shown at the rental property of Lisa Marshall in Katy Wednesday, Sept. 30, 2026. Like many home sellers struggling to sell their properties these days, Lisa converted her property to a rental.<\/p>\n
Melissa Phillip\/Houston Chronicle<\/p>\n
When Lisa Marshall listed her family\u2019s Katy home late last year, she figured it would sell quickly. It\u2019s in a highly rated school district, and she invested tens of thousands of dollars into cosmetic upgrades. Instead, it \u201cjust sat and sat and sat,\u201d Marshall said.<\/p>\n
After more than six months, $30,000 in price reductions and one canceled offer, Marshall did what more home sellers are doing now: she decided to lease the property instead. She found a family member willing to rent it for $2,000 a month. Even though her home is paid off, she will likely barely break even after factoring in property taxes, utilities, maintenance and homeowners\u2019 association fees.<\/p>\n
\u201cI\u2019m in a much more fortunate position than some people, but it\u2019s difficult for us,\u201d Marshall said. \u201cWe just got to the point where I was like, \u2018I can\u2019\u00a0t physically and financially continue.\u2019\u201d<\/p>\n
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Marshall is part of a rising number of so-called accidental landlords, or owners who are opting to lease rather than sell their homes amid tepid buyer demand and rising competition from soaring supplies of for-sale homes<\/a>.<\/p>\n Houston now leads the nation as a hotspot for accidental landlords<\/a>, outpacing Denver, Austin and San Antonio, according to real estate firm\u00a0Zillow.<\/p>\n Overall, an estimated 4.3% of single-family rental listings in Houston are properties that owners gave up on selling in the previous three months \u2013 triple the rate of three years ago.<\/p>\n \u201cThat likely undercounts the rentals that would’ve been sold otherwise had the market been firmer,\u201d said Kara\u00a0Ng, senior economist at Zillow. \u201cFor every homeowner who tried (selling) first, there are likely some who were discouraged by the softer market, bypassed selling, and listed straight into a rental.\u201d\u00a0<\/p>\n Article continues below this ad<\/p>\n For some homeowners, becoming a landlord is an easy way to generate income. For others, it\u2019s a necessary decision complicated by unexpected costs, frustrating tenants and rents that barely cover their expenses.<\/p>\n Ng said markets with more accidental landlords tend to have a greater supply of for-sale homes with price reductions, longer days on market and less competition among buyers. That\u2019s the case in Houston, where the number of single-family homes hit a record level this summer, according to the Houston Association of Realtors.<\/p>\n The effects are spilling into the rental market. Houston\u2019s supply of single-family,\u00a0townhomes and condominiums available for lease ballooned by 80% in the past three years \u2013 hitting about 16,660 listings in September, according to John Burns Research, not including build-to-rent homes.\u00a0<\/p>\n During the pandemic, it took less than a month to lease a single-family home, said Kevin\u00a0Macicek, a broker with property management firm Area Realty. Now it can take up to 60 days, he said.<\/p>\n Article continues below this ad<\/p>\n Ample supply is also keeping a lid on rent prices. And after spiking during the pandemic, rent growth started slowing in 2023. Houston single-family rents average $2,054 today, roughly flat from a year ago, according to John Burns Research.<\/p>\n RELATED: Houston has a record number of homes for sale. Buyers still can’t find bargains.<\/a><\/p>\n Renting a single-family home is taking longer amid a surge in listings. Pictured is a for-rent sign\u00a0displayed outside a Houston home in 2020.<\/p>\n Melissa Phillip\/Staff photographer Sellers near neighborhoods filled with new construction homes often can\u2019t compete with builders offering incentives and discounted mortgage rates, said Paige Martin, lead of Houston Properties Team, a real estate brokerage. \u00a0<\/p>\n Article continues below this ad<\/p>\n \u201cIt\u2019s really tough. It\u2019s not uncommon for people in that position to lease for a while to ride it out,\u201d Martin said.<\/p>\n In Spring, Stacy Peacock said she is considering transitioning her family\u2019s for-sale home <\/a>to a rental after the property sat unsold for almost two months.<\/p>\n \u201cOnce we listed it and pictures were up, everybody was like, \u2018Oh it’s a beautiful house,\u2019\u201d Peacock said. \u201cBut it just hasn’t sold yet, so we’re like, \u2018What the heck is going on?\u2019\u201d<\/p>\n Stacy Peacock’s home in Spring is shaded by a mature oak tree and features an expansive backyard, yet its sat on the market amid a glut of listings in the area.\u00a0<\/p>\n Houston Association of Realtors<\/p>\n After relocating to Magnolia, the stress of paying for two mortgages, in addition to utilities and lawn maintenance at the Spring property, is starting to weigh on Peacock and her husband. They recently lowered the asking price by 4% to $229,000.<\/p>\n Article continues below this ad<\/p>\n \u201cIt honestly made me feel dirty, because I\u2019m like, \u2018No your home is worth this, and the comps are there,\u2019\u201d said Allison\u00a0Sewell, a real estate agent with<\/p>\n Compass who is representing Peacock. But sometimes \u201cit could just be about timing.\u201d<\/p>\n There are 26 homes for sale in the Timber Lane area where the Peacock\u2019s home is located, all within a similar price range, according to\u00a0HAR. Less than three miles away, there are two subdivisions with builders offering discounted mortgage rates on newly built homes, too. \u00a0<\/p>\n Sellers of homes in higher price ranges aren\u2019t immune to similar challenges. In a gated community in Cottage Grove,\u00a0Arpita Sharma initially thought her three-bedroom home<\/a> built in 2019 would sell for about $810,000 when she listed it this spring. After several price reductions \u2013 the home now sits at $769,000 \u2013 Sharma said she plans to begin marketing it for lease soon.<\/p>\n Arpita Sharma’s home in a gated Cottage Grove community features an elevator and rooftop terrace with a pond view. She’s expects to convert the for-sale home into a rental soon amid a sluggish home sales market.<\/p>\n Raquel Natalicchio\/Houston Chronicle, Houston Association of Realtors<\/p>\n Sharma estimates her monthly carrying costs are about $4,900, including the mortgage, taxes, insurance and homeowners\u2019 association fees. She\u2019s dipping into savings to cover those costs, plus the mortgage on the home she recently bought in the Heights.<\/p>\n \u201cI do regret it now to be honest,\u201d Sharma said, of her recent move. \u201cI didn\u2019t know I would end up in this situation, where I\u2019m just stuck with this (other) house for sale.\u201d<\/p>\n Still, Sharma considers herself blessed to be in her financial position, and to have\u00a0benefited from historically low mortgage rates in 2020, when she bought the home.<\/p>\n EARLIER: Houston has the largest supply of for-sale homes in the country. Here’s how that will affect buyers.<\/a><\/p>\n Meanwhile, owners who purchased properties after mortgage rates started rising mid-2022 are confronted with dual challenges: often they\u2019re saddled with higher interest rates, and sometimes, their home values haven\u2019t risen enough to cover the cost of moving.<\/p>\n In Spring, real estate agent Jose Moreno of\u00a0Nan and Co. Properties said one of his clients wanted to sell his home, but would have had to pay his lender about $15,000 to $20,000 to cover the gap between the price he paid for the home in 2022 and the price he could sell it for today.<\/p>\n \u201cHe was going to take huge negative equity at closing \u2026 because he bought in a seller’s market and he paid a premium,\u201d he said. Moreno advised him to lease it instead.<\/p>\n Some agents, like\u00a0Tricia Turner, founder of Tricia Turner Group, are encouraging their clients to market homes for lease and sale at the same time.\u00a0\u201cLet’s see what the market does,\u201d she tells them.<\/p>\n<\/p>\n
\nWhere sellers are feeling pressured to lease<\/p>\n<\/p>\n