Why I Will Always Allow Pets in My Rental Property

by | BiggerPockets.com

I used to be a strict pet-free landlord. I followed the same logic any investor might when deciding if my renters would be allowed to keep pets: Pets cause damage. They increased wear and tear, which could negatively affect my bottom line. Therefore, I simply would not allow pets at my properties.

But after 15 years of real estate investing, I’ve had a change of heart. And no, it’s not from those puppy dog eyes (pet or human!), but because I have come to see pets as a potential income source for my properties.

In this article I will break down the income-producing incentives that tipped the scale toward making my rentals pet-friendly properties.

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Reduced Vacancy Time

Time is money in rental management, and the longer my property sits vacant, the less money it makes. The majority of rental properties are advertised as “no pets,” according to rental search data from Zillow.  This correlates with rental search data from my own software’s database, which found that 27 percent of rental properties in the U.S. advertise “Pets OK,” compared with 73 percent U.S. rental properties advertised as “No Pets,”—based on a sample size of 61,790 units*.

The easiest statistic to find regarding pet ownership among renters comes from a 2014 survey published by Apartments.com. It claims that 72 percent of renters own pets. More recently, Zillow released its 2017 Consumer Housing Trends Report stating that only 32 percent of renters have pets.

This research indicates that there is a shortage of pet-friendly properties compared to the number of renters seeking pet-friendly housing. By allowing pets at your rental, you open your tenant pool and increase the desirability of your rental. This leads to shorter vacancy times between tenants.

Related: 11 Ways to Boost Tenant Retention for Higher ROI

Spend Less Time Seeking Funds to Repair Damage

If your state allows it, you have the option to charge an additional pet deposit on top of a standard security deposit from your pet-owning renters. Pet deposits can be used for cleaning a property or repairing damage caused by a pet.

Pet deposits offer additional security and allow you to have available funds to cover the cost of pet damage or excessive cleaning. If you only collect a standard security deposit and a pet causes more damage than the deposit will cover, you have to invoice the tenant to cover the cost of cleaning (or repairs) beyond the security deposit. You will then be actively seeking payment from a renter who has moved, and they—or the money—might be hard to track down. If this bill goes unpaid, you can either move forward with collections or sue the tenant as your state laws allow. Or, you could eat the cost to avoid prolonging the issue.

Regardless, you will either have to spend time or funds dealing with chasing down additional payment for pet-caused damage. Having an additional security deposit limits the possibility of requiring additional money from your tenant.

Related: 7 Types of Tenants I’ll Never Rent to

Pet Rent

Another option for pet-friendly properties comes in the form of a monthly pet rent. Pet rent is collected along with your tenant’s standard monthly rent and can run anywhere from $10-$50 a month per pet. Over the course of a year, this pet rent can add an additional $120-$600 to your rental income.

In areas where vacancy rates are low and availability of pet-friendly rentals is even lower, most tenants expect to pay extra to live with their furry roommates.

Increased Renewal Rates

In general, your pet-owning tenants are more likely to become long-term renters, due to the fact that pet-friendly rentals are more difficult to find. When you build routine rent increases into your lease agreements, these long-term, pet-owning renters are the cream of the crop for an investor.

For every renewal, I also find it important to perform regular inspections. This helps determine any pet damage or problem areas that should be addressed before they become more expensive down the line.  

The Legality of Pet-Friendly Properties

Make sure to check your state and local laws about increasing deposits and the legality of non-refundable fees. Your lease should have clear language about the types of pets acceptable at the property and what additional rent, fees, or deposits are associated with a pet-friendly rental (just remember to get it checked out by a trusted attorney before anyone signs on the dotted line). I also find it valuable to require renter’s insurance for all tenants, especially for your pet-owning renters.

A Special Note About Service Animals, Emotional-Support Animals, and Therapy Animals

Your tenants that have service animals or emotional-support animals (ESA) are protected by the American Disabilities Act (ADA). As a housing provider you’re required to make reasonable accommodation for these renters and their animals.

Renters with a service animal or an emotional-support animal are exempt from paying an additional pet deposit, pet fee, or monthly pet rent. They will, however, need to provide proper documentation regarding the need for such an animal, as required by the ADA and Fair Housing Laws.

*Data provided by Rentec Direct based on rental property advertisements for 61,790 units.

Do you allow pets in your rentals?

Have you had a good experience overall? Share your thoughts below!

About Author

Nathan Miller

Aside from being a landlord and real estate investor himself, Nathan founded Rentec Direct, a software company that serves the rental industry. Today he works with over 13,000 landlords and property managers by providing them automation software and education to effectively manage their rentals.

21 Comments

  1. Christopher Smith

    I prefer tenants not to have pets, but almost all do especially in my tenant class (upper middle income types). So if you try to exclude them you’re cutting to deeply into your prospective tenant pool and it’s costing you money.

    So I let them have pets, and simply up the damage deposit accodingly.

  2. Dave Rav

    Just scanned the article but I would guess, if structured correctly and limitations on types of pets are set, this could be profitable.

    You can 1) increase overall rent, 2) have a non-refundable pet fee, and also a 3) pet cleaning deposit. This mitigates your risk. I have never done all three. But theoretically, dependent on your area and situation the spike in rent could be $30-40/mo, non-ref fee $100, and deposit of $400. Just gotta make sure these monies cover the potential max of damage the pet could do. (It isn’t always just carpet…I once saw an REO where the idiot residents apparently chained the animal in a room and the corner of the wall/trim was literally stripped away! I’m talking like 3 inches of drywall and part of the wood stud was cut away due to the friction of the chain rubbing! You never know what people are capable of.

    I also like your point about reducing vacancy rates.

  3. Patrick Liska

    Nathan,
    You bring up good points, as far as income from having pets, I have a couple of properties that I have allowed pets and charge $25/m for them, I do like what you said about having a cleaning fee and may have my PM include that. My wife and I have a dog and have had other dogs through the years so I am not adverse to pets, but some people just do not know how to take care of them. I had one tenant that we had to evict, for non payment of rent, but the dog they had ruined the hardwood floors in one of the bedrooms by urinating all over it, we had to rip up and install all new hardwood in that room because there was no way to sand it out. Had to put the past tenant to collection, this was 6 months ago, the good news is they are actually paying back slowly ( even the collector get a cut of it) I can hopefully recoup my $2000 cost. Bottom line is to make sure everything is in writing and to let them know they are responsible for any damages caused by the animal – service animal or not.

  4. Teresia Sayler

    If I allow a pet it’s a minimum $500 pet deposit over and above the regular damage deposit. I also make it mandatory as part of the screening to ask the prior landlords for a reference on the pet as well.
    I recently had to replace living room carpet entirely. Not due to soiling but it appears that the “well-behaved cat” was behind bedroom doors and didn’t like it so he scratched up the carpet down to the nap.
    If pet urine gets into subflooring at all it is nearly impossible to get out. So you either have to seal it, replace it, or do your best to deodorize. There are also carpet manufacturers that line the back of their carpet to avoid this but I am not sure that it works.
    In all likelihood new tenants that are pet owners, will be the only ones not to wrinkle their noses up at potential pet smells no matter how strong.
    On occasion I also add$25 per month to rent in addition to the pet deposit. Hefty deposits are the main way to mitigate hiring professionals to repair the damages. I believe most renters understand that now. I’ve even asked to meet the pet first.
    Also remember to look at your insurance policy or call your agent regarding coverage if you happen to rent to someone with a dangerous dog breed. There could be a long list of them that you would never think would be on the list but you don’t want to find that out when making a claim or when getting sued. Ask them to provide a picture of their lab mix, or whatever it is as it could easily be a pitbull or Rottweiler mix which are the two top breeds for lawsuits.

  5. Wilson Churchill

    I wouldn’t allow pets in any home that has hardwood flooring. I once had a tenant that thought it would be a good idea to “rescue” six dogs and three cats. I’m not going to describe what I saw and smelled when I visited the property, but you can probably imagine. Fortunately, the house has a slab foundation. I removed all of the existing flooring and put down cheap ceramic throughout. That is the only house in which I still allow pets.

  6. $25 a month extra rent sure isn’t enough money to allow pets. And what about the added turnover time it takes to replace carpeting and or deodorize when they move out? Not to mention when a dog ruins your lawn and landscaping. I’m still not convinced to allow pets after reading this.

  7. Christopher Smith

    You can take most of that out of their pet enhanced security deposit, my managers also tell me it takes no added time on turnover, they can pull a carpet and have it replaced in a few hours.

    Plus in my tenant class at least 2 out of 3 have a dog or cat. By accepting pets I’ve kept my overal turnover to less than 2 percent. I guess there is no way to know for sure what it would otherwise have been, but I know it would have been consuderably higher and at an average rental rate of about 2,700 per month dead time is a killer.

  8. Amy A.

    I no longer allow dogs in my multi-units because the barking bothers the neighbors. Also, there’s often one tenant who doesn’t pick up after their dog and if there are multiple dogs I can’t tell who it is. I once had a tenant get so sick of the mess that she scooped it all up and dumped it in front of the door of the tenant she thought was the offender. It turned out to be the wrong tenant!

    • Wilson Churchill

      “I no longer allow dogs in my multi-units because the barking bothers the neighbors. Also, there’s often one tenant who doesn’t pick up after their dog and if there are multiple dogs I can’t tell who it is.”

      If dog poop isn’t picked up, it can attract mice and roaches. The mice can also bring bedbugs..

      • Kathleen Price

        My apartment complex that I currently live in did a dna swab test for each dog living on the property. If one poops on the premises it is collected, sent out for testing, and then a fine of $500 is given to the owner. It has prevented this problem!

  9. Susan Maneck

    Something to keep in mind, is you need to check your insurance to see which they might not cover or you could end up losing your house to a dog bite! I don’t allow aggressive breeds like bit bulls. Any other dog, I want a deposit for. Extra rent for bets is not done here, near as i can tell. But this may surprise you. I no longer require a pet deposit for cats, the reason being whatever damage the cat might do is far cheaper than what I’ve had to pay for rodent control. I had one house that I paid $1700 to seal from varmints with little success. I persuaded my tenants to take care of my cat when I went on vacation, and wallah the next complaint I get is over the dead mice left on the doorstep. Sorry, that’s what cats do. But rodent problem solved.

  10. Steve Ryan

    Just thinking out loud… Considering there are more tenants who have pets than landlords who allow them, if you do, you’re effectively targeting pet owners. What if you simply set your rent $50 above market and advertise it as “pet-friendly, no extra charges or deposits” or something along those lines? I mean, have it right there in the title of your Craigslist ad so no one misses it. That’s sure to have a big halo effect on their subsequent impression.

    If it’s a year lease, you just made an extra $600. If they stay longer (which pet owners statistically do)–well, the math is pretty simple. In terms of damage, the regular deposit can of course be used for pet damages too, and anything over that can legally (theoretically) be collected. There’s almost no limit to the amount of damage a bad actor can do, especially once they know their deposit is shot. But if the deposit covers your deductible, the added risk seems pretty minimal.

    Here’s the real kicker: If you’re in a 5-cap market, that extra rent just boosted your property value by $12,000, which could be a big help if you’re BRRRR-ing. The biggest downside I see is if you’re in a competitive market, people might never see your ad because their price limit is just under. But right now on Craigslist, there are only six dog-friendly rentals (out of 33) within 10 miles of my town of about 20,000, so I don’t imagine people are being too strict with their parameters.

    Again, just spit-balling here. I’m sure there are factors I’ve neglected or under-weighted. I’d love to hear other peoples’ experiences, or at least better-educated guesses!

    • Matt Lawrence

      I like that logic Steve, I was thinking on the same line. Wish I had some concrete numbers but I feel that when people see the price listed on anything not just rentals, they have an immediate impression & skip the details; “fine print” hence the importance of, as you specified, having no pet deposit or extra fees in the listing title.

      I’ve listed 1 house for about 3 years where I increased the rent ($30) to compensate for the paid security system I had covered. So instead of $1100 I had $1130 & put paid security alarm included but in the description, not title (zillow). I feel I got substantially more calls when I had the $1100 listing price. I need a bigger sample size though to see what connects with potential tenants best.

      Anyway I’m becoming more pro pets than I was before, numbers don’t lie so thanks for the article.

  11. Michael Bishop

    I couldn’t agree more with your first point. This is especially true for markets that are more pet friendly in general or household pets are more common, such as Austin, TX; by excluding pets, you’re dramatically reducing your potential tenant pool.

    You also might be surprised by how many landlords aren’t aware of the ADA and try to fight tenants on ESAs, only making the inevitable more difficult

  12. Alexandra Page

    We’re beginning to see abuse of the “service animal” “therapy animal” designation. We received a letter from a doctor out in CA (we’re in MA & so was the tenant) justifying a therapy animal for a 1 bedroom apt. under 500 SF in a building with no green space. We do income verification for these same people & know they’re not home all day long. I don’t object to allowing pets in theory & my husband and I are animal lovers with pets of our own but I do take issue with the concept of getting a dog because you want one without regard for the circumstances wherein you live.

  13. Margaret DelColle on

    We allow pets. One cat or dog until we see how responsible the tenants are. We charge a $300. per pet however will give a break on a second pet if they are responsible. (charge $500 for the two.) It seems everybody has a cat or dog.
    We have a $300.00 cleaning fee to be determined by the landlord in our leases so that could be for damage the pet makes or the tenants.
    If there are wooden floors we ask the tenants to install rug runners along where a dog would walk. Also if it’s a cat have them put the litter box in the basement (we only have houses for rent) and put the litter box in a hard plastic kids pool. (litter gets out of the box and we’ve had smell problems from that in one of our rentals)
    We only allow dogs under 35lbs however we upped the rent amount for one tenant that had two large long haired dogs. That house was so clean and beautiful it looked like something out of a Better Homes magazine.
    So I guess it all depends on the pet owners. It would be good to go see the pet in the potential tenant’s house and check their housekeeping…

  14. Andrew Syrios

    We always allow pets in our houses, although we charge a pet deposit ($250) and pet rent ($25/pet) and don’t allow dangerous breeds of dogs. A lot of people want to rent a house particularly because they want to bring their pets, so it’s a big advantage to allow them IMO.

  15. I deal with a specific niche market with my rentals in that my rentals are horse property. Horse owners are always dog owners, therefore I do allow dogs. I charge extra for each horse as well as dogs. Since rental horse property is extremely difficult to find in this area, I never have a problem with vacancy and tenants keep the property very well as they know how hard it is to find. Also, I am a good landlord. I fix problems immediately and always check in with them to see if everything is ok as I find they are usually hesitant to complain if something is not working right. My biggest problem is when I do have a change in tenant, trying to decide on which applicant to pick. I typically have dozens to choose from with most of them offering “bribes” to get the property such as paying more in rent, paying two months in advance, or monetary gift to gain favor in consideration.

  16. Nancy E.

    Hello Nathan,

    Thanks for the advice.

    However, the article should have also addressed the property insurance requirements. Since insurance companies can stipulate the type and weight of the pet. Liability insurance should be researched before landlords automatically agree to allow pets.

    Just a FYI for those landlords considering changing their no pet practice.

    From Nancy

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