IS A PET-FRIENDLY RENTAL PROPERTY A GOOD IDEA?

Part of your tenant screening process should include deciding whether you allow pets in your rental property or not. This will have a great impact on your rental property in terms of how much profit you can make, how many tenants you can attract or whether or not more damages will be done to your property. Some landlords may not be familiar with the pros and cons of inviting pets into the household. Allowing pets in the rental property can give you a competitive edge over others that don’t, and it could lead to more damage and repair costs. Let’s consider the pros and cons of allowing pets in your rental property.

PROS

Larger tenant pool

Most U.S. residents, especially families with kids, have pets. Allowing pets opens up the opportunity for more potential renters. According to the Humane Society of the United States, Americans own approximately 83.3 million dogs and 95.6 million cats.

More rental income

Typically, a landlord who allows pets will charge a higher rent to a pet owner, than to a no-pet renter. This gives you the opportunity, as the landlord, to charge extra for pets in the property. You might argue that increasing the rent will likely deter tenants, but pet-friendly rental properties are sometimes hard to find, as one survey claims, wherein 60% of prospective pet owning tenants struggle to find a pet-friendly rental. Tenants with pets expect they may pay more rent to have their pets.

Pet rents or pet deposits are fees that you can charge your tenants. They can be a measly $15-$20 fee per month that can earn you up to an extra $180-$240 annually.

CONS

Damage to the apartment

Pets, especially those that haven’t been trained properly, can scratch doors, chew up furniture, and have “accidents” on carpets and hardwood floors. These are just some of the exploits pets can have, especially if they’re unattended. This means more clean up and repairs when the tenant moves out.

Liability

The liability of pet ownership doesn’t just fall on the tenant, it falls on the landlord as well. There may be a risk of the animal causing physical harm to neighbors and other tenants. This is one reason that most landlords impose a size restriction on pets. Smaller breeds can bite, but one coming from a chihuahua poses a much lower risk of injury than a rottweiler’s.

Future tenants can have allergies to animals, which may imply extensive cleaning or even renovations to make it suitable for them.

It’s important to know how you’re going to approach the possibility of pets in your rental property, to mitigate any unwanted risk. One good safety measure is to include a pet policy in the lease agreement. The pet policy will outline a set of do’s and don’ts. Here’s a few things to consider prior to renting to a pet-owner.

Ask pet-related questions

Your tenant screening process should include asking questions about their pet. Some questions could be:

• What type of pet do you have?

• Is the animal properly vaccinated and does it have the proper papers?

• How big is your pet?

• How many animals are you bringing with you?

• How long have you had the pet?

• Who will care for the animal when the owner isn’t around?

Charge a pet deposit

As mentioned earlier, a pet deposit means more income with the monthly rent. Be cautious though, since there are state laws where charging for additional fees can be illegal. Michigan doesn’t have pet laws in rental properties. However, federal law requires landlords to accommodate tenants with service animals.

There is a debate whether the deposit should be refundable or non-refundable. A non-refundable fee assures you of extra money; however, it could also open the door for more damage, since the tenant knows they are not receiving the deposit back. They may be more lax on controlling their pet.

A refundable deposit may be a better idea. Consider a one-time charge of $180-$240, or more. This would make your tenant more responsible in handling their pet to make sure that they could have their money back. The extra pet deposit acts like a regular deposit, or cleaning deposit. It is there to help you cover for excessive wear and tear caused by a pet.

Apply restrictions

One restriction could be the number of pets allowed. This would make sense, especially when you consider the size of the rental unit. Tenants usually do not have more than two pets with them, so be vigilant when it comes to this.

Another could be a size restriction. For example, all dogs must be no taller than 20 inches and no more than 40 pounds.

You may want to restrict what type of pets are allowed. Perhaps you’ll only accept cats. This restriction could help avoid a tenant bringing in a less common pet. It’s a good idea to see any pet before the tenant moves in.

Include expectations from the owner

The pet policy should also outline the responsibilities of the pet owner once they’re allowed in the rental property. Some of them could state that:

• The tenant is responsible to clean up any “accidents” their pet left inside or outside of the property.

• The animal is properly vaccinated and has the required licenses and tags with it.

• Dogs are to be leashed at all times if unattended outside the property.

• If any part of the pet agreement is violated or if the pet has caused harm to others, this would mean a possible eviction for both the animal and the owner.

As you can see, there are pros and cons to allowing pets in your rental property. It really comes down to what you are comfortable with. If you allow pets, having a thorough pet policy in your lease can help you minimize problems with pet owning tenants. It also needs to include the process a tenant needs to take if they get a pet, after they move in. Any decision you make towards your rental property should involve thought and a thorough process.