I think it is more the other way: a nearby landlord can keep track on how his property is being used and take action early before there is a problem. If a tenant is likely to be caught in the act of destroying the place that are less likely to do that. Sadly as every landlord knows many tenants will not pay their rent and then destroy their apartment.

This is also helped by nearby landlords probably are small enough that equal opportunity laws don't apply. Stereotypes on the appearance of bad renters is true enough to be useful even though it is often wrong and always immoral.