There are a number of reasons beside owning the property outright. They can make a bigger down payment than you can, so the total debt is lower. They bought it at a much lower price many years ago. Their total capitalization is much larger than yours, which drives interest rates toward zero. Their tax basis is different than your tax basis would be.

It is straightforward financial math. If they have more capital than you or a different tax basis, they can have a lower monthly cost basis than you.

At least where I live, many landlords have no mortgage at all, because they just buy properties with cash. Another scenario would be a landlord making a very large down payment, and thus, financing a much smaller amount, and thus a much lower monthly payment.

Also, the landlord could have bought the property before the price went up. Their mortgage does not necessarily reflect today's price.

Maybe they bought it 20 years ago - in CA that would be lower price and lower property tax.

Rents are set by the market not the interest rate.