Why you SHOULD allow animals

[Nathan Gesner]

This is probably the best study I've found on the benefits of renting to pet owners. Too many Landlords believe pets cause too many problems and result in a loss of revenue. This study found the opposite to be true. Based on my personal experience with approximately 10,000 leases, I can verify animals are a money-making machine, not a detriment to your business.

Pet-Friendly Housing Study

I hope you actually take 10 minutes to read the article because it has some great information. For those that can't find the time, here are some key findings:

• Approximately 50% of housing studied was pet-friendly to some degree. Only 9% allowed animals without restriction, half allowed cats, and 11% allowed large dogs.
• 82% of renters reported problems finding housing that would accept their pet.
• Pet-friendly rentals earned about 20% more in rent.
• Annual net benefit to the Landlord was $2,949.
• Tenants with animals stayed 3x longer.
• Vacancy was shorter and marketing costs were lower for pet-friendly rentals.
• The average damage reported by each Landlord was $430
• Pet owners did not cause more damage than Tenants without pets, whereas Tenants with children averaged $150 more in damages
• 20% of the tenants surveyed admitted to keeping an animal illegally
• Proper screening significantly reduced the risk. Only 3.7% of the Landlords required pet references, only 7.4% required a pet resume, 11% required health records, and only 18.5% required Tenants sign a pet agreement.

The bottom line: renters with animals are no more dangerous to your property (on average) than renters without animals. The increase in damages is negligible and the financial benefits are absolutely staggering. 

The best thing you can do as a Landlord is:

• educate yourself on how to screen animals properly
• develop rules and be prepared to enforce them
• charge reasonable fee for the benefit of allowing animals.

You'll rent places quicker and easier, you'll make more money, and your tenants will stay longer.

Landlords, join the conversation:

• Does your personal experience match the findings?
• How do you screen animals?
• Do you charge for animals? Deposit, fees, or rent? Or all three?
• Do pet owners leave more damage or cause more problems than people without pets?
• Do pet owners stay longer?
• What's the biggest difficulty you have with animals?

[Matt M.]

@Shane H.

That’s cool, except those of us that dont own dogs can smell them. 
my mother in law is an absolute fanatic about keeping her dogs clean and her house, except I can still smell them, and it’s gross to me. Glad you got a chuckle out of “pets smell”, but it’s true. 

[Shane H.]

@Matt M.

Lol obviously my response was meant to be entertaining, but no one is bathing their dog as often as they're showering themselves. So it's an unfair comparison. If humans go two days without a shower we stink. If I bathed my dog everyday she would smell like whatever shampoo I used just the same as we humans shower daily to keep ourselves smelling like the soap and shampoo we use. Humans smell far worse in a shorter period of time. 🤷🏼‍♂️

[Rachel C.]

Originally posted by @Shane H.:

@Rachel C.

This "unfortunate millennials" who have been unable to make home ownership a reality, have no put in a valiant effort due to their preconceived notion that it wasn't possible. Millennials have had one of the greatest opportunities to build wealth early in life that has been afforded to any generation in the last hundred years. I just wish I knew more earlier on to have taken advantage of it sooner.

Put in no valiant effort? I don't think it's accurate to make a blanket statement about an entire generation of people. Especially since they have suffered from one of the most financially devastating economic crises of our lifetimes.

I found some data directly from the US government to support my claim.

From the United States Senate Joint Economic Committee (<<< Click Link for Source)

"Millennials are still recovering from the financial crisis, which will likely put a permanent dent in their long-term economic security. The financial crisis, which began as many millennials were entering the workforce for the first time, has dampened economic opportunities for the entire generation. Negative effects include higher rates of underemployment and unemployment, wage stagnation or declines, and limited economic mobility. Millennials are less likely to earn more than their parents than any previous generation in American history. (Emphasis Added.)

In 2017, millennials earned a median income of roughly $20,010, while the current unemployment rate for millennials ages 25 to 34 and likely not in college is 4.2 percent.

The Economic State of Millennials in America
Rates of homeownership are falling among millennials, undercutting the generation’s ability to build long-term wealth. The financial crisis had a significant impact on young adult homeownership, with a large share of millennials opting to move back home to regain their economic footing.8 Millennials of color were disproportionately affected by the housing bubble and bursting, which damaged their creditworthiness and made it more difficult to obtain a mortgage."

I just pulled some relevant aspects from the report but feel free to review the entire report.

And now they have to contend with a pandemic that has caused the unemployment rate to skyrocket to 13.4%. (Data straight from the US department of labor.)

This is the highest level of unemployment since The Great Depression. (See chart below, data straight from US Bureau of Labor Statistics.)

And don't get me started on student load debt compared with previous generations.

SHANE - Do you have some trustworthy sources of information for your claim that 'Millennials have had one of the greatest opportunities to build wealth early in life that has been afforded to any generation in the last hundred years"? 

If so, I'd would love to see it! Please post!

[Rachel C.]

Originally posted by @Nathan Gesner:

Originally posted by @Rachel C.:

@Nathan Gesner

Just a heads up, this study was funded by North Shore Animal League. So they had a conclusion in mind when they began this study which means any investors relying on this study should be very wary of taking it at face-value. NSAL tout themselves as being 'leaders in the no-kill movement' which at first seems like a humane policy but in reality, animals that are unplaceable due to health or violent behaviors are perpetually traumatized in these shelters since they can't be placed in homes. It is a harrowing life for them.

Big takeaway here - Conducting a 'study' that encourages landlords to allow pets in rental homes furthers the NSAL's financial interests because much of their sources of funding are dependent on being a no-kill shelter. They don't have landlord's best interests in mind. They are using the survey to grow and maintain their sources of revenue by keeping more pets out of shelters because they are expensive to keep. Best to just take these types studies with a proverbial grain of salt. There is a pet lobby actively encouraging policies on multiple fronts. Just in the U.S. pet economy alone, sales are projected to exceed $75 billion this year, up from $72.5 billion in 2018 and a doubling of 2005’s $36 billion. If more landlords allow pets, then this sector can continue to grow more rapidly especially since economic disparity and the multiple crises that have hobbled those unfortunate enough to be millennials make home-ownership completely out of reach for most of them.

Just because they have a dog in the fight (see what I did there?) doesn't mean the data is incorrect. I read the entire thing several times and it jives with real-world data I've gained over the years from thousands of leases, thousands of tenants, and thousands of animals.

When their study says children cause more damage than pets, I agree and it's something I share with Landlords all the time. When they say Landlords are more likely to make more money rather than lose money, I agree and it's something I share with Landlords all the time. When they say the risk is higher because Landlords fail to screen or enforce rules, I agree and it's something I share with Landlords all the time.

HA! Yes, they do have a dog in this fight! And I completely agree. Data doesn't have a bias. However, that is only true if the data was collected without an end goal in mind. Unfortunately, in this case and many others, research needs to be funded and whoever funds it has a million ways to manipulate it. So understanding where the data came from is an important aspect to understanding what info is reliable.

"There are three kinds of lies: lies, damned lies, and statistics." - Mark Twain

Every landlord's investment strategy, tenant pool and risk tolerance is going to be different. For many people, allowing pets just isn't worth the hassle and will ultimately hurt their bottom line.

I think a more appropriate title to this post may have been: For some landlords, it may be worth considering allowing pets! 

[Shane H.]

@Rachel C.

It's the exact reasons you point out that gave them such an opportunity. (I speak for myself as a millennial by the way.) As we turned of age the market crashed. Anyone who had any financial literacy would have started buying into the super low market. I must admit while I contributed to my account during the financial crisis I took it out too soon due to lack of financial literacy. The real estate market crashed as well, just before it was time for millennials to start buying homes. What did millennials do? They waited until prices sky rocketed again to start buying. You can't possibly think that was a smart strategy. Fear prevented millennials from buying. Not the market. You should get into student loan debt... That's the driving factor of millennials poor financial position. And it's a choice they made. Another poor choice. If they had borrowed money to buy homes instead of to get college degrees they wouldn't use, and invested in the market instead of Starbucks and iphones, millennials would be quite wealthy. I made some of those same mistakes which set me back. I've recovered quite well. The pandemic is a fear based decline yet again. It seems this generation is plagued by fear. Fear that needs to be overcome to reap the rewards of the opportunities we have had afforded us!

[Account Closed]

only made it through the first page...sorry...

I have zero problems with pets, I have serious problems with pet owners.

The problem is animals do not have the same rights as people and so then some people treat animals with cruelty, which happens to be their right to do so in many instances.

The result is if I were to allow pets, I would inevitably find myself in a moral argument with my tenant - no thanks.

I consider animals at a residence pets and animals kept in the barn livestock. Pets are family and livestock is food.

But the truth really is, if we get hungry enough, our pets become livestock - lol.

Me? I just say no. Didn't even have to get to the part where I consider the aspect of property damage.

But hey, if society decides to turn our urban residence areas into rural agricultural areas, I suppose I wouldn't object to that either. I think that means we live in the smell of poo, but I'm farmer blood so I'm good if that's what we need to do to make it all work. Perhaps the landlords can start marketing space for chickens and gardens and goats too! My neighbor has some chickens and they're actually adorable (pets for now - lol). I always wanted some goats myself - cut the grass for me.

[Rachel C.]

Originally posted by @Shane H.:

@Rachel C.

It's the exact reasons you point out that gave them such an opportunity. (I speak for myself as a millennial by the way.) As we turned of age the market crashed. Anyone who had any financial literacy would have started buying into the super low market. I must admit while I contributed to my account during the financial crisis I took it out too soon due to lack of financial literacy. The real estate market crashed as well, just before it was time for millennials to start buying homes. What did millennials do? They waited until prices sky rocketed again to start buying. You can't possibly think that was a smart strategy. Fear prevented millennials from buying. Not the market. You should get into student loan debt... That's the driving factor of millennials poor financial position. And it's a choice they made. Another poor choice. If they had borrowed money to buy homes instead of to get college degrees they wouldn't use, and invested in the market instead of Starbucks and iphones, millennials would be quite wealthy. I made some of those same mistakes which set me back. I've recovered quite well. The pandemic is a fear based decline yet again. It seems this generation is plagued by fear. Fear that needs to be overcome to reap the rewards of the opportunities we have had afforded us!

Do you have any sources? Any sources whatsoever? Data perhaps? How about a financial analyst's opinion? Or we could even lower the bar as far as possible, how about a quote from a millennial saying, "My economic opportunities are the bomb, yo!" Anything besides your own personal 'old man shakes fist at cloud' rant?

[Michelle Fenn]

I am both a buy and hold investor and property manager. I do allow pets. The first thing I learned was never call is a deposit. It is always a non-refundable fee. When I first started as a landlord, I would charge one month's rent as the pet fee. In Class B & A neighborhoods I had no problem in getting large pet fees. In Class C rentals in Cleveland area $500.00 per pet, I allow them to pay over 2 months, seems to be the top before I reach push back. I now use the $500.00 fee for all my rentals, to maintain consistent fee policies. I have transitioned away from carpet as a flooring choice and use Luxury Vinyl, Bamboo, commercial Pergo and tile as my flooring choices. I find I get better long term tenants by allowing pets. In a SFH in Macedonia Oh Akron Area my tenants paid to fence my 1/2 acre yard. They stayed 3 years and when they moved on their improvements increased the value of my 1031 Swap. I also have a clause in my lease to permit HVAC maintenance 4x per year, I change the furnace filter. I use it to monitor tenants that I suspect may be violating lease provisions.

The property management company I work with charges $250.00 fee and $25 - $35 per monthly pet rent.  We do not allow pets in duplexes unless both tenants are pet lovers.  

[Shane H.]

[Shane H.]

Originally posted by @Rachel C.:

Originally posted by @Shane H.:

@Rachel C.

It's the exact reasons you point out that gave them such an opportunity. (I speak for myself as a millennial by the way.) As we turned of age the market crashed. Anyone who had any financial literacy would have started buying into the super low market. I must admit while I contributed to my account during the financial crisis I took it out too soon due to lack of financial literacy. The real estate market crashed as well, just before it was time for millennials to start buying homes. What did millennials do? They waited until prices sky rocketed again to start buying. You can't possibly think that was a smart strategy. Fear prevented millennials from buying. Not the market. You should get into student loan debt... That's the driving factor of millennials poor financial position. And it's a choice they made. Another poor choice. If they had borrowed money to buy homes instead of to get college degrees they wouldn't use, and invested in the market instead of Starbucks and iphones, millennials would be quite wealthy. I made some of those same mistakes which set me back. I've recovered quite well. The pandemic is a fear based decline yet again. It seems this generation is plagued by fear. Fear that needs to be overcome to reap the rewards of the opportunities we have had afforded us!

Do you have any sources? Any sources whatsoever? Data perhaps? How about a financial analyst's opinion? Or we could even lower the bar as far as possible, how about a quote from a millennial saying, "My economic opportunities are the bomb, yo!" Anything besides your own personal 'old man shakes fist at cloud' rant?

"My economic opportunities are the bomb yo!" Is that good for the last option? Considering I am a millenial who is literally trying to say I'm so grateful for the economic opportunities I've been afforded. You already provided the data. I'm not disagreeing with the data you provided. I suppose we differ in opinion as to what is an economic opportunity... Personally I see down markets as opportunity. I cut years off of my timeline to financial independence since March. The down market has made dividend stocks more affordable. The capital gains from the investments I made in March and April have cut the time in half to put away my next down payment. I just put a property under contract with that money today! I'm not sure what data you would like from me. I'm not arguing data. I'm arguing how to use the data. Every investor knows that down markets create opportunity! Use it to your advantage. I purchased my home out of foreclosure. Using a strategy taught to real estate investors. I owned my home by 25. With 0 down. (a few hundred in legal costs) It was free and clear by 30. It's far from beautiful, but I have no payments! Wish I started this game at 18! What better time to find homes for 0 down than when people are losing them? I.E. the same time millenials should have been looking to purchase, but we were busy racking up student loan debt for degrees, in fields we would never hold a job...

[Michael Picher]

@Matt Nico I do $400 pet entry fee and 40 per month extra per pet

[Brian Ploszay]

The demand for your units is greater with pets.  The customer (tenant) wants housing that allows pets.  Nothing much more to understand.  

I dread larger dogs or errant peeing cats.  Also, some dogs don't bark.  Others do.  The barkers cause disruptions for the apartment units.  For rental houses, no issue.

[Nathan Gesner]

Originally posted by @Rachel C.:

I think a more appropriate title to this post may have been: For some landlords, it may be worth considering allowing pets! 

A comparable statement would be, "For many people, investing in real estate just isn't worth the hassle" or "For many people, finding a professional property manager isn't worth the hassle and costs too much."

If we all had that attitude, none of us would invest in real estate. I've heard people say they would never invest in real estate because Tenants just trash the property. Well, that's true if you do it incorrectly. I manage 400 rentals and fewer than 1% leave owing more than their deposit will cover, but that doesn't mean the owner has lost money. I set my cash flow aside so I can handle capital expenditures, vacancies, and even tenant damages not covered by the deposit. If I stick to my formula, it's almost impossible to lose money.

Same with pets. The majority of renters have at least one pet. The majority of them are good, responsible people that will not cause more damage/cleaning than the deposit will cover. When you institute proper screening, have solid rules and enforce them, inspect 1-2 times a year, and charge a small increase in rent, it's almost impossible to not generate a profit.

But if it's too much hassle, that's cool. It just makes my rentals more marketable and helps keep my profits up.

[Irina Belkofer]

Pet security deposit (refundable) $300-700 per a dog.

No cats. Absolutely.

Pet rent $25/mo per dog not more than 2.

Excellent tenants with great income, credit & background offered to keep one dog totally free.

Problems so far: after moving out, tenant left condo stinky and dog hair all over the walls. Tried to wash it off walls - no luck. Had to paint all house, twice as her security deposit. (Dog - golden retriever)

Another tenants dog has constant complains about barking, it's HOA and it's really a problem there. She's moving out next week and I don't want any dogs there - it's really get very heated conflict with neighbors

My friends dog bit little girl in her house(her parents dog sitter the dog - German Shepard. By the court decision the dog has to be killed, his insurance paid for the plastic surgeries etc. but he has ambrella coverage. If that happened in one of my rentals - I don’t have enough liability insurance.

Most of the cities around have list of prohibited breeds and one complain from the neiborhood- you’ll have to remove the dog if it’s acting aggressive and police was called on. 

So, when I screen the tenants, my preference is no pets. Despite that I love dogs and have one. 

[Rebecca Bauer]

Overall I would concur with pets as a definite plus vs negative. If you don't accept some type of pet you are really eliminating a large section of the rental market from seeing and residing in your units.  I would however, adopt the policy of a NON REFUNDABLE PET FEE (not a deposit) this would give your applicant some skin in the game and you some additional income to offset any unanticipated "accident", etc. Don't limit your market pool.

[Luke Jacob]

@Matt Nico I have a tenant with two cats and they paid $250 non refundable pet deposit and $50/mo pet rent

[Matt C.]

I just read the entire thread and the article.

For me personally, I am in a fairly high demand area so don't get much from the benefits of opening up to pets.

I do have some observations though, but first a brief primer on Ontario, Canada pet related rules. Of course the standard caveat - not legal advice, do your own research, etc.

OK, the rules:

Ontario’s Residential Tenancies Act does not permit landlords to include “no pet” clauses in rental agreements. The only exception is if the property is a condominium and the condominium corporation’s declaration prohibits pets.

Interestingly, a landlord can refuse to rent to a person who has a pet (no discrimination clause), but a landlord cannot evict a tenant simply because they were unaware of a pet, or because the pet was adopted after the tenant moved in. A tenant can only be evicted if a pet is making too much noise, damaging the unit, causing an allergic reaction to others, or is considered to be inherently dangerous. Even then, in order for a landlord to take action, the landlord first must bring the issue to the attention of the tenant and the tenant has the ability to mitigate the issue. If there is damage done to the property, the tenant can opt to repair the damage. If the animal is disturbing neighbours, the tenant might prevent the animal from being outside and limit its exposure to neighbours, if the animal is upsetting a fellow tenant's allergies due to fur contaminating the communal laundry machine, the pet owner can do their laundry elsewhere. Only after all that is exhausted the landlord must apply to the LTB for an order terminating the tenancy before kicking people and pets out.

Also, a landlord is not allowed to charge a pet deposit. 
A landlord is allowed to ask for a last month’s rent deposit, as well as a key or pass card deposit, BUT the rent deposit must be applied to a tenant’s last month’s rent, and the key deposit must be given back to the tenant upon the return of keys. It is illegal for the landlord to use these deposits for anything else, such as to pay for damage caused to the unit by people or pets.

Further, most municipalities in Ontario have their own restrictions on the number of pets that can live in any individual home. In Toronto for example, no dwelling can house more than three dogs, or more than six cats.

SUMMARY - In Ontario, landlords cant do much about pets after the place is rented. Even if you asked and they lied on their application that they dont have any pets, you cant evict them for a fraudulent application. 

This means the news is not good for Ontario landlords:

1. While allowing pets on the lease just makes life easier as, hopefully, they are truthful and upfront and not hide and bring them in later since I cant do much at that point, I cant force them to pay more. I might reason with them the additional risk I am taking and quote them a higher monthly fee, but its iffy.

2. I cannot force them for any animal/pet deposits or advances, similar to NYS it seems like. Similar to above, I can however ask them for an animal fee, and might reason with them for one but cant force them to pay one

3. I CAN and DO ask for tenants insurance, but am yet to find any policy that has pet related damages to my property covered in that.

4. I can't restrict the animal type, unless the city by-law allows me to. I am yet to find a by-law that prevents any cat breeds - and they are the worst.

So, basically, all that I can do is regular inspections to check for damage.. SIGH.

Oh and you cant do "too many" inspections either -- apparently even doing more than once a quarter may jeopardize the tenant's "right to quiet enjoyment of the rental premises".

And Lets not even go into how difficult it is to evict someone even if there is damage, and even more difficult is to get them to pay for damages.

If people have ideas, I am all for it!

[Matt Nico]

Originally posted by @Dan Adams:

@Matt Nico

I use a pet screening process.

Our prices range from 30-50 monthly or 300-500 yearly depending on the pet score. This is pet rent and non refundable. People will pay it. I don’t personally agree with it. But it’s my job to enforce.

Hey Dan,

Thanks for the info. I know the tenants that are moving into the place personally. Since my wife and I know them I am kind of cutting them a break on the pet deposit. I agree a monthly fee would be safer and get us extra cash flow. I think we will increase the pet deposit on a yearly basis for now. My lease is structured to keep the deposit if there is any pet damage anyway so I am covered.

-Mattt

[Scott Raley]

I charge $250 per pet up front on a rental agreement and $25 per month thereafter per pet. No female cats and no dogs over 30 lbs if it's in an HOA. Birds are no charge. I also have the tenants sign a separate disclosure stating they will be 100% responsible for any and all damage their pets causes to the residence or common property if there is an HOA. No pitbulls or german shepherd dogs. I live in lawsuit happy Bay Area California so I need to keep things dialed in. Yes, I have found renters with pets to be more stable tenants.

[Jessie Walls]

Sounds like the discussion indicates risks, damage, problems relating to pets but in order to make it worth it for landlords, put a barrier to entry that benefits to the property : fee and better yet, a monthly charge.  Sorry for those places that can't discriminate against pets (Canada post).  The few applicants we came across that wanted dogs in our No Dog Duplex in popular Los Angeles Los Leliz, appeared to be not ideal dog renting folks.  Non-profit & PHD student reserved a puppy (likely $500-1K) after moving into our $2500 2bed/1 bath house with no fence.  Several other applicants that wanted dogs had a month of savings. Risky. Didn't pick any of these applicants.

I'd rather them save their monies to improve their savings or situations. 

Working in law enforcement and veterinary medicine, parents own 3 animal hospitals, my sister is a K9 officer, I would agree that situations depends on the owners which makes this a risky business policy.  Depending on others to abide by shaky "noise, bad behavior, barking, smelly" rules [is mainly dependant on he said she said between tenants] isn't somewhere I like to invest in.....unless it's profitable!

[Adam Tafel]

My best performing property is a medium-term-dog-friendly-furnished-renal. Vacancy is almost non-existent, I get about 70% above market rent. I've always been a big fan of dog owners as tenants, a responsible dog owner is generally a responsible tenant. 

[Jae Kwak]

@Nathan G. In Southern California, the demand for rent is much higher than its supply. Recently, we have new law adapted and the landlord no longer denied to accommodate service pets or compassionate pets however most landlord had not ready to entertain tenants with pets due to lack of knowledge and readiness. Must study the cases and I recommend extra pet deposit or increase rent and additional coverage through rental insurance. I totally agree with you but takes time

[Eric James]

In my area, pet owners are oftentimes the worst tenants. They have no choice but to live in rentals, but have 4 large, aggressive breed dogs. They are simply irresponsible people.

[Phil Wells]

Good find on the article.

I always tell investor clients of mine that pet owners stay longer and pay more - don't default to no! The only issue I've found comes with insurance companies that won't cover incidents involving certain breeds of "dangerous dogs". 

[Jenni Utz]

Also there is a National company called PetScreening.com that will fully screen the pets for you. The owners are certifying several things, and they also verify emotional support animals to make sure proper paperwork is submitted. Top Notch Company!