Landlording & Rental Properties

Data (Finally) Answers: Does Allowing Pets in Rentals Pay Off?

Expertise:
4 Articles Written
Cute four months old Jack Russel terrier puppy with folded ears at home. Small adorable doggy with funny fur stains. Close up, copy space, background.

With BPInsights launching in the second half of 2020, I am one of the lucky few who gets early access to the immense dataset we’ll be opening up to Pro and Premium members.

Want more articles like this?

Create an account today to get BiggerPocket's best blog articles delivered to your inbox

Sign up for free

As I began looking through some of the rental comp data we’re assembling, I was very intrigued to learn if our dataset could help me answer, once and for all, if allowing pets in a rental property is a worthwhile investment.

So I looked through over 150,000 rental listings on the market in the first half of February 2020 and have come up with some interesting findings about the age-old question of allowing pets. Please note that I am both a pet owner and animal lover—the results below are not meant to stir up the eternal cat versus dog debate (although they might).

Check out my findings below.

gray cat lying on floor

Key Findings

Before we get into the data, allow me to make clear one thing: This study does not include pet rent. The data available to me simply show the price of the apartment listed for rent and whether or not allowing dogs or cats is advertised on the listing. So while it would be ideal to add more data to this study in the future, right now we’re looking at the pricing implications of advertising dogs and cats in your rental.

Related: An Emotional Support Peacock—Really?! How to Navigate the Murky Waters of ESAs as a Landlord

So, what are those implications? Nationally, the net effect of advertising that you permit dogs has a 5 percent increase on gross rent. In dollar terms, that comes out to $81/month or $972/year.

For cats, the national averages tell a different story. Cats, on average, reduce gross rent by 8 percent—which comes out to -$139/month, or a loss of $1,668.

However, as with most things data, the national level averages do not really tell the whole story about what is going on. In fact, the real story is much more complicated and dictated by the type of property under consideration. Read on to see more details on how allowing dogs or cats might affect rent in your property.

Apartments vs. Houses

After seeing the nation-level data chalk up a big loss for allowing cats, and a modest rent increase for allowing dogs, I was curious to see if that pattern held true under closer scrutiny. So, I took a look at how this data changed when I broke it down by the type of property: house vs. apartment.

As you can see from the two tables above, breaking down this dataset by property type changes everything!

For both cats and dogs, the effect on rent prices for apartments is negative, although cats certainly have a more dramatic negative effect on gross rents (-11%) than dogs (-2%). But the overall picture is clear—advertising that pets are allowed in an apartment is associated with lower asking price for rent.

On the flip side, if you’re renting out a house, you may want to consider allowing both types of animals, as allowing a cat is associated with a +7% increase in listed rent price and allowing dogs had a +10% effect.

Number of Bedrooms

The last thing I wanted to understand was how advertising a pro-pet property was affected by the number of bedrooms in the unit, and what I found was very interesting.

For both cats and dogs, the effect on advertising that pets are allowed had a negative effect for smaller units. However, that shifts when the units have greater than or equal to two bedrooms.

The above chart shows three things: average rental price for units that do not allow cats (green), average rent price for units that do allow cats (blue), and the percentage difference between those two rents.

Related: 3 Reasons Landlords Should Blacklist Certain Dog Breeds

As you can see, the effect on smaller apartments is clear. For studios (0 bedrooms), advertising that cats are allowed reduces average listed rent by 28 percent! That is a huge amount. However, as you go up in the number of bedrooms, that trend reverses itself. At two bedrooms, the difference between permitting and prohibiting cats is 0 percent, and once you get to three bedrooms and up, there is a net-positive effect on gross rent.

The same pattern exists for dogs. It starts negative for studios (-22%), and quickly becomes positive with two bedrooms (+5%) and goes all the way up to +16% for five-bedroom units.

I was curious why this pattern might exist, so I did some quick research and found one possible explanation. According to the American Veterinary Medical Association Survey, in 2018, the amount of family households that own pets was around 66 percent. Meanwhile, the number of non-family households (single renters, roommates, etc.) was only 47 percent.

My best guess is that the demand for pet-friendly rentals is disproportionately tilted toward families, who are likely to want larger units with two-plus bedrooms. But let me know if you have another hypothesis about why this trend might occur.

Conclusion

While this dataset does not tell the entire story about pets (notably, it omits any notion of pet rent, and I make no attempt to estimate the increase in “wear and tear” that allowing pets entails), it does provide some useful information.

  • Overall allowing dogs in your rental has a greater positive effect on advertised rental price than allowing cats.
  • The benefits of allowing dogs and cats is greater for houses than it is for apartments.
  • The benefits of allowing dogs and cats increases as the number of bedrooms in the unit increase.

So, what do you do in your rentals? Personally, I charge a $250 refundable deposit and $25 in pet rent per month per pet. As a pet owner and animal lover, I want to make my rentals pet-friendly, but I also want to make sure that I am not taking a loss by allowing pets. I think the these fees are sufficient to cover the additional “wear and tear” associated with allowing pets.

Blog ad for Wealth magazine

Do you allow pets in your rentals? Why or why not? 

Weigh in with your opinion in the comment section below.

Dave’s entire career has been spent as a part-time real estate investor and full-time data nerd -- so working at BiggerPockets is a perfect fit. Dave invests primarily in multi-family residences, a...
Read more
    Brian Lucier Property Manager from Groton, MA
    Replied 2 months ago
    Great read! Thanks Dave!
    Zach Gring Rental Property Investor from Sugar Grove, IL
    Replied 2 months ago
    Thanks for taking the time, that’s a good informative piece.
    Andrew Syrios Residential Real Estate Investor from Kansas City, MO
    Replied 2 months ago
    Here in Kansas City, at least for houses, you would be crazy not to allow pets. This city is full of big backyards and pet lovers. (But always charge a pet deposit and pet rent too)
    Aly W. Investor from Middletown, NJ
    Replied 2 months ago
    We have rental condos. Most allow pets under 20 pounds. I do charge pet rent and a larger deposit for a new tenant. For an existing tenant with a good track record of taking care of the property, it's just additional pet rent.
    Paul J Perez from Astoria, New York
    Replied 2 months ago
    Any suggestions for making your rental pet friendly? Is there any way to guard against pet wear and tear?
    Jim Hudelson
    Replied 2 months ago
    We allow dogs in our ST rental house. I can't speak to cats. In my opinion, dogs are generally less abusive on the property than kids are. We charge a $100 pet fee and this has more than paid for any repairs and additional cleaning. We also require a $500 security deposit, which probably goes farther towards motivating the dog owners to keep things under control. Puppies are trouble. We generally won't allow dogs less than 18 months in age. The bigger issue is whether the pet owner is responsible or not. This is difficult to gauge. We require 3 things from dog owners: 1) proof of current vaccinations, 2) a picture, and 3) application of flee and tick preventative. The last one is hard to prove but we ask/require it. I believe that the proof of current vaccinations is a must. This at least shows that the dog is under the care of a veterinarian on some level. Dogs will jump on furniture. Most pet owners allow this. We provide a few old towels/sheet/blanket that they can use as a cover. Furniture material can be a factor. Imitation leather tends to get scratched up. We have a set of windows in the living room that are just the right height for dogs to put their front feet on to look out. We put a short bench in front of these windows so that the dog will hop up on top and look out instead of clawing the wood work. Window glass that is head height will get smudge marks from them pressing their face into it. More cleaning but not a big deal. Making a point that poop-patrol is their responsibility and leaving a cleaned up yard is required - as in a threat to charge for extra cleaning if we have to do it. We have had very few issues with dogs. Allowing them has absolutely increased the number of bookings that we get, and I believe it has even improved the quality of renters that we get. Partying 20 somethings are not typically bringing a dog with them. Middle aged to elderly couples often times travel with their pets. Bullseye!
    Tarek Okail
    Replied 2 months ago
    Need more data. Tell me about vacancy rates, time to rent rates, length of tenancy, eviction rate, and post-rental damage mitigation costs if any. Break down how you got to those rental payment numbers. What I'm seeing is a different explanation of the costs. What I'm seeing is that *landlords* are willing to rent pet-allowed apartments for less base rent because they know that they'll make it up in the pet rental fees since most rental properties on the market, especially apartments, *don't* allow pets.
    Drew Leo Investor from Walnut, Ca
    Replied 2 months ago
    Agreed. The stats are good but to make it useful we like to by region or city, if pet rent was applied, and how much. We don’t allow pets.
    Nate T. Investor from Tempe, Arizona
    Replied 2 months ago
    This information doesn't seem like it would be very useful unless you were comparing pets-versus-no-pets in the same type of properties, in the same type of areas. Otherwise, the differences can be explained by the differences in the properties, i.e. crappy apartments are cheaper than nice apartments and more likely to allow pets. That doesn't tell you how much more rent you can get for allowing pets in a property, or whether it's worth it.
    Heshel Mangel
    Replied 2 months ago
    Notwithstanding the lack of other days as you mention - this is one of the best pieces I've read from biggerpockets. Really excited to see your other insights!
    Heshel Mangel
    Replied 2 months ago
    *data
    Catherine Rohde
    Replied 2 months ago
    In the past I'd sought to answer my question of whether not allowing pets impacted DOM. While I admittedly was working with a much smaller data set I arrived at the conclusion that it didnt, which surprised me as I assumed allowing pets would actually have a large influence. It's interesting to see your results and obviously there's a lot of ways to dig in more. For instance, I'd be curious to know if allowing pets changed from false when the property first went on market to true if the property sat for a longer duration, and if the property went through price changes as well. I can see owners originally avoiding the hassle of pets and later changing strategy due to lack of applications to open their property up to a wider range of folks. Good piece of information to know about the share of tenants (family/single) that are pet owners!
    Terrell Garren Rental Property Investor from Concord, NC
    Replied 2 months ago
    Dave, I'm worried about you. Unless this was a thesis for a MS or PhD, you need a hobby. Best, Terrell
    Marnee Klintworth
    Replied 2 months ago
    Sorry, a continuation of previous post - how can your tenants who can't pay rent to you expect to pay for new rent and damage deposit, movers, utility changes etc if can't pay rent to you. To move out would cost twice as much as what they already owe. Not saying be a sucker but stating the obvious 'we are all in this together'.
    Paul M. from Medford, Massachusetts
    Replied 2 months ago
    Sorry only skimmed, but if you didn't control for apt condition not sure what conclusions can be drawn. Personally I'll never allow except in aging apartments. No deposit will cover the damage.
    Jason Jodway Real Estate Investor from Charlevoix, Michigan
    Replied about 2 months ago
    While I am appreciative in you putting in the effort to collect this data, the way you've gone about this demonstrates you lack expertise in epidemiology, and makes it frankly at best useless and at worst grossly misleading. To immediately demonstrate the point, the primary reason for a landlord to allow pets is that the market demands it and they cannot comfortably find tenants without it. As such you are automatically creating a sampling bias toward a "rentor's market". The only way to really test this is to collect proper data on the increase in long-term maintainence/capital ex compared to how much more revenue can be generated by allowing the pet(s). Since people with pets generally have great appreciation for them, I cannot see it ever being incorrect to allow them. You simply have to screen your tenants properly and to collect revenue appropriately from them.
    Deanna Opgenort Rental Property Investor from San Diego, CA
    Replied about 2 months ago
    If I'd just done a beautifully stylish, high-end rehab the rent will be higher, and I will be much less likely to allow animals. A more middle-of-the-road/ economy-priced place I'm already pet/kid proofing as much as possible anyhow.
    Obia Uzorka Rental Property Investor from Detroit, Michigan
    Replied 21 days ago
    Who knew, great 👍🏿 piece really informative.