Yes, offsite landlords with traditional rental agreements will charge their tenants more. However, there are at least three options that are better for tenants and landlords alike.
Land Contract. A rent-to-own agreement, recorded with the county, much like a deed.
Private mortgage. Available only to individual landlords, not institutional investors.
Condominium. Deeded property on the inside, rental on the outside.
In all three, the tenant gains equity in the property over time. In all three, the terms are established at the time of the agreement, and the agreement is "permanent" in that it can only be canceled by the "tenant". The "landlord" can't arbitrarily increase the price year after year. All three offer considerably better return for the landlord after the property tax increase. The landlord and tenant convert their rental agreement to one of these options, and there is much rejoicing.
The only traditional rental arrangement that is likely to remain widespread is where the landlord occupies one unit in a duplex, triplex, or quadplex structure. That landlord can claim the owner occupant credit for the whole property while renting out the additional units.