Should You Rent Your Investment Property to Pet Owners?

by | BiggerPockets.com

For most pet owners, their critter companions are an irreplaceable part of the family.

But while dogs (or cats, rabbits, teacup pigs, etc.) may be man’s best friend, the feelings aren’t always shared by landlords.

Of the 25 largest rental markets, just 18 percent allow small dogs while 20 percent allow cats, according to a 2015 Trulia ranking. The numbers get even ruffer for big dogs: Just 4 percent of rental listings nationwide explicitly allow large breeds.

As a landlord of eight years and the owner of seven investment properties, I know a thing or two about the pros and cons of maintaining a pet-friendly rental home. My advice? Before you decide on a policy, it’s helpful to have the facts upfront.

Here are some things to consider:

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Pros of renting to pet owners

Renting to tenants with pets

  • More (renter) fish in the sea: Having a no-pets policy is like saying “no, thank you” to more than half of the population. Approximately 68 percent of U.S. households—or about 85 million families—own a pet, according to the 2017-2018 National Pet Owners Survey conducted by the American Pet Products Association. From 2012 to 2014 alone, the number of renters who owned pets jumped from 43 percent to 72 percent. And with millennials comprising the largest segment of pet owners and renters, the demand for Fido-friendly spaces is only likely to grow. Landlords competing for qualified, desirable tenants could be missing out by not allowing pets.
  • Cuts down on sneaking: When push comes to shove, some renters will simply lie about having a pet. In fact, a 2003 pet-friendly housing study by Firepaw revealed more than 20 percent of tenants reported they were keeping pets illegally. By having a strict no-pets policy, there’s a chance you’ll still pay the price of having animals in your rental property without receiving any of the benefits.
  • It boosts your bottom line: Pet owners would much rather do things by the book than hide a contraband cat in the closet when it’s time for annual inspections (or take an awkward detour past the leasing office on their daily dog walk). To account for general wear and tear, it’s fair to charge a non-refundable pet deposit. Some landlords also charge an extra monthly pet rent to help cover landscaping and maintenance.
  • Less tenant turnover: In my experience, tenants with pets tend to stay put longer. After going through the hassle of finding a pet-friendly rental property in the right area, they’re not exactly eager to repeat the charade all over again—especially in markets with high rental demand and competition for affordable living (cough cough, San Francisco and New York). The data is pretty compelling as well. According to the same Firepaw study I mentioned above, tenants in pet-friendly rentals stay an average of 46 months compared to 18 months for those in rentals prohibiting pets.  
  • Responsible renters: This is my personal anecdotal point of view, but I think renters who put the time and energy into taking good care of their pet(s) are more likely to be responsible tenants who respect your property and treat it like a home.

Should I rent to pet owners?

Related: Should You Allow Pets in Your Rental Property?

Cons of renting to pet owners:

  • Property damage: Dogs and cats (and frankly, their owners) can lead to increased wear and tear on your property. All puppies (and most grown dogs) need to chew on things. This behavior is completely natural. It becomes a problem, however, when owners fail to teach their dogs what’s OK to chew on and what’s not. Cats can scratch up window screens and destroy blinds. Pet dander gets into vents and carpeting. Odors can permeate just about every type of flooring. And even older, well-behaved pets have accidents now and then. It simply comes with the territory.
  • Liability: While not common, there are cases where landlords can be held responsible for dog-related incidents. Additionally, many insurance policies won’t cover certain sizes and breeds considered to be aggressive, such as pit bulls, rottweilers or Dobermans. This is why some landlords put breed restrictions in place.
  • Possibility of multiplying: If owners aren’t responsible about spaying or neutering their pets, one loose cat or dog can turn into many kittens or puppies in a single litter.
  • Noise: Barking dogs and squawking birds do not endear themselves to neighbors, especially in the middle of the night.

Renting to tenants with pets

What about service and emotional support animals?

Service and emotional support animals are covered by the Fair Housing Act, which requires landlords and apartment managers to make a “reasonable accommodation” for both service and emotional support animals. Landlords cannot charge a pet fee, pet rent, or a higher security deposit for these types of animals, nor can they inquire about a tenant’s disability.

A landlord can, however, ask for legal documentation that the animal is needed, provided the disability for which it is needed is not obvious. Usually, this takes the form of a verification letter from the prescribing physician or therapist.

There are exceptions. Including:

  • Buildings that only have four units or less, and the landlord lives in one of them.
  • Single-family homes that are sold or rented without a real estate agent, and the landlord owns no more than three single-family homes at one time.

Make sure you have the right policy in place

First, check with your insurance company about what types of pet damage they’ll cover. You do not want to find yourself making costly repairs because your insurance policy doesn’t cover certain damages or breeds of dogs. You should also ask your policy provider about liability coverage for dog-related injuries.

Put it in the lease

Add a Pet Addendum or Pet Rider to your lease. This will cover the non-refundable pet deposit, monthly pet rent (if you choose to charge it), and any additional fees. You can also require proof of obedience training, veterinarian records showing the pet has been spayed or neutered, and/or a renter’s insurance policy covering the pet(s). If you’re really on the fence, you can always ask for a meet and greet or letter of recommendation from a previous landlord.

Related: Why I Allow Pets in My Rental Properties

Work with your property manager

Whether you’ve bought an investment property with pets already on the premises, or are considering putting a new pet policy in place, it’s important to understand the existing policy or create a new one you feel comfortable with. This is one of many reasons I highly recommend working with a trusted, licensed property manager who is up to date on current laws and best procedures for renting to tenants with pets.

Conclusion

The decision on whether to rent to pet owners can be a morally conflicting one. If you’ve ever been a renter with a pet—and many of us have been—you likely understand the challenges of finding (and affording) the right place.

On the flip side, buying a rental property is no small potatoes. Your investment is a business, and it’s wise to treat it as such. Wanting to protect your asset is perfectly reasonable.  

In this case, I believe you don’t have to compromise on doing what’s best for your business. By having the right insurance, pet policies and property manager, you can protect your asset while serving the demand of a very large and ever-growing renter segment.

What are your policies for renters with pets? Share them below!

About Author

Zach Evanish

Zach is the Director of Client Advisory Services for Roofstock , the leading marketplace for buying, owning and selling leased single-family rental homes. Previously, during his tenure as Director of Acquisitions at Waypoint Homes, he oversaw the purchase of more than 1,500+ properties. A landlord of eight years and owner of seven investment properties, he enjoys helping real estate investors of all sizes build their real estate empire!

10 Comments

  1. Brian Grant

    Great article, it really helped as I am currently trying to rent my property, and the property manager has said the two thing stopping people from qualifying are credit score and me not wanting to allow pets. I will have to rethink the pet side of this. I look forward reading the comments. Thank you for this article.

  2. Domenick T.

    Excellent article! I especially appreciate the exemptions to ESAs you point out. Most landlords aren’t aware of these exceptions.

    Whether you decide to allow pets in your rental or not, my advice is to make sure you have a rock solid lease clause that specifies the penalties for violations. Especially if you allow pets. Always specify the rules and expectations of your tenants when it comes to their pet.

  3. John Mclain

    Nice post. Our residential properties are high end and we struggle with the pet issues. Our official policy is yes to pets on a case by case basis. I have found the meeting the pet, especially large dogs helps us make the decision.

  4. Susan Maneck

    Having found just how expensive rodent treatment can be, I now allow cats with no deposits. I don’t provide blinds for my tenants anyhow and normally put in laminated floors whenever carpeting needs replacement. Whatever damage a cat is going to do is more than made up by the fact they keep the rats away. I once paid $1700 to treat a house for rats. The next year the rodents were back. Fortunately I was about ready to go on vacation so I asked these tenants to take care of my cat for a month. Lo and behold, no more rat problems.
    I do require additional deposits for dogs and I always want to meet the animal. Big dogs are okay, but no pit bulls or other aggressive breeds.

    • Raymond Jensen

      We acquired a foreclosure recently. One of the biggest issues with the house was dog pee smell coming from a room that was converted from a garage. It smells like a Chicago subway. After removing the carpet, we found the plywood underneath to be stained with dog urine. Thankfully the dog(s) decided to do it there rather than another location where there were hardwood floors. We will make sure the smell is gone before laying down laminate flooring lest the smell still emanates and we have to tear up the flooring.

      Anyway, I would allow tenants to bring a cat because cats are cleaner animals and they will use a litter box if you have one and maintain it. Plus cat pee is ammonia and it will eventually evaporate. Dog pee, like humans, lingers because it is urea. If you are going to allow dogs or even cats you may want to make a surprise visit to the tenants current domicile. If you smell pet odors there, then there is a good chance you will smell at yours after they move out.

  5. Nathan G.

    Your blog hits all the right points, Zach. In my experience, a poorly disciplined child causes more damage than most pets!

    Animals are a risk. Landlords need to learn how to identify the risk, mitigate it, and then profit from it. With nearly 70% of the population owning pets, it makes sense to market to them and make more money.

  6. Jerry W.

    Zach,
    Thanks for taking the time to share your knowledge with us. I especially liked the part about ESA and service animals. I had understood that the rules were slightly different for each. Very realistic article with content a lot of landlords need to know. I had good luck with cats for quite awhile, but one bad experience resulted in thousands of dollar damage from the urine issue. I have NEVER found that cat urine smell goes away, run a shampooer over the spot 10 years later and it smells fresh. I put several coats of oil based KILZ over a hardwood floor before it was over.

  7. 17 yrs ago when we got our first duplex, i thought i was smart for allowing dogs because it seemed like i was able to easily rent the units. One thing i can say, looking back on 17 years as a landlord now with 7 properties and almost all are rented to pet owners is, the long term costs are not worth the short term upsides. We put in the ads “responsible pet owners considered” I tell prospects im not sure i want to rent to pet owners (all our units are freestanding with fenced yards) and that my biggest clncerns are Barking: especially when the resident is not home. And POOP clean up. Every single pet owner ive rented to swears they pick up after their dogs every day, feigns horror /surprise that people DONT; and that their dogs dont bark… i stop by and can smell the poop from the other side of the fence. Flies everywhere
    Property destruction: yards are trashed from dogs digging, dead grass – and when theres poop everywhere – my garderer refuses to mow the lawn- so its a cycle of depreciation- sure ive had long term “happy” tenants but the properties are going to take way more than the slight premium in rents to bring them up to market in the future.
    One last downside: RATS! Loving dog owners leave the back door open so the dogs can gobin and out at their leisure, where just inside the door, is an open bowl of dog food and water. Four months later and ive got the same person who kissed my ass to rent to them with theor dog complaining that the house is in “uninhabitable” condition and that i must pay for them to stay in a hotel while i rid the property of the rodents their laziness has invoted. Im just saying- landlord beware… i own the house next to mine and got suckered in again by a nice older gentleman with two labs. Great tenant in the pays on time sense, but Their barking has caused me grief on a weekly basis and i have to text a 60 year old man to shut his dogs up or clean up his dog poop about once a month. I guess the moral of the story is if youre a nice guy (-er, sorry: “person”) with a big heart and are considering buying rental property you should get a highly reccommended property manager. We did this with all bit the neighbor propertyand the increased rents paid for their fees from the first month-

  8. Zachary Hendricks

    We have really found it to be a positive to rent to pet owners. We’ve found that if you call past landlords and screen the tenants well, we can weed out some of the bad pet owners and lease to the good ones.

    Before we allowed pets (or knew how to screen tenants) we had a lady move 3 pit bulls in the back yard. When she moved out, the dogs stayed and we had to find homes for some sweet pits.

    Great article!

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