When I talk to landlords across the country, I’m always shocked at how many prohibit pets.
What these real estate investors don’t realize is pets are great for business!
Over two-thirds (68%!) of U.S. households own at least one pet, according to the Insurance Information Institute. If you have a blanket policy barring all pets at your investment properties, that only leaves you with 32% of the applicant pool to choose from.
Pet owners also typically stay for longer tenancies. Why? Because it’s much, much harder for them to find a home that’s pet-friendly. That means less turnover, which, in turn, means higher returns. (Ever hear the quote, “Go where your competition ain’t”? This is what they’re talking about.)
And the demand-supply gap applies doubly to tenants with large dogs. Everyone assumes big dogs are a higher risk, but that’s not necessarily true. Large–dog owners have a difficult time finding rental housing, which spells O-P-P-O-R-T-U-N-I-T-Y for savvy landlords.
Without further ado, here are six ways to play offense and earn more money from pet-owning renters. In our upcoming companion piece, we’ll break down six defensive tactics to eliminate risk and make sure you don’t lose money by allowing pets.
1. Charge monthly “pet rent” to lessees.
This one is simple: First, make it clear in your rental listing that this unit is pet-friendly. Collect applications, including details of the number and types of pet each applicant has.
If you like the look of an applicant with a cat or dog, explain that you happily accept pets, but you charge a monthly, non-refundable pet fee to cover the extra wear and tear. Keep it reasonable: I like between $15 – $29 per month, per pet.
This is important though: Don’t disclose the pet rent in the rental listing, or else you’re just asking for renters to lie about their pets, and you may scare off some potential applicants by doing so.
2. Charge a Non-Refundable Pet Fee
This is another no-brainer. The non-refundable pet fee (collected as a one-time, at the beginning of the lease term) should cover the entire cost of a deep cleaning of your rental unit.
That should include a carpet shampoo and steam clean, if your unit has carpets (but I don’t recommend carpets to landlords; more on carpet alternatives when we cover defense and protecting against pet-related losses).
If your tenants leave the unit needing a deep clean, you’re covered. If they leave it spotless, you’ve just earned some extra money. Congratulations.
3. Offer an affordable dog-walking service
Many people can’t walk their dogs as often as they’d like. Most leave early in the morning for work and don’t return home until evening.
If you’re not a practiced entrepreneur, that’s what “market demand” sounds like: If there’s a crucial service your lessees need, become the helpful supply.
Sure, you could walk your renters’ dogs yourself, if you love them and have the flexibility and interest — but no one says you have to do it yourself.
Perhaps your teenager is looking for some extra cash? Or, maybe you could hire a local retiree or stay-at-home–parent who lives in the neighborhood and adores dogs.
You can always market the service to your renters to gauge demand, before deciding whether to commit. At the end of the day, though, this could be an invaluable service for those living in your investment properties and a fruitful (see: $$$) endeavor for you.
4. Shift rental damage liability to tenants
There’s a blurry line between “damage” and “normal wear and tear.” We like to sharpen that line in our lease agreements.
Write into your lease a series of pet requirements. Then, work into your lease that any scratches, stains, damage, and discoloration, etc. to flooring will be deducted from the security deposit.
The idea is twofold:
- First, prevention: You want your renters to treat your property’s flooring with kid gloves. The tighter your regulations on flooring and the more the tenant feels responsible for it, the better they’ll treat it.
- Second, accountability: You want to reclassify as much flooring “wear and tear” as possible to fall under “damage.” It’s too expensive to have to re-carpet or refinish the floors every time you have a turnover; Do everything you can to make sure that if the flooring does need work after the tenants move out, they’re the ones paying for it.
5. Proactively market to pet owners
Earlier, we showcased how pet renters have a harder time finding rental housing. This means an opportunity for you to serve a high-demand, underserved market.
Brainstorm ways you can make your property more attractive to pet owners:
- Backdoors with doggie doors built in?
- A fenced-in backyard where they can play?
- A leash line, harness, or tie-out?
- Automatic food or water dispensers?
- A fenced “dog park” on the premises of a multifamily complex?
Even the dog–walking service outlined above is a great pet-friendly amenity you can pitch.
Or (and here’s where things get even more interesting) you can offer “flexibility” for your renters to install these themselves.
When a tenant moves in, you can say,
“I know how hard it can be on dogs to be cooped up all day; we’re open to discussing it if you want to add a doggie door or a leash line.”
You get a new, upgraded rear door, and the tenants feel a greater sense of ownership in the property (and, of course, an even greater incentive to stay long-term in your pet-friendly rental).
6. Levy fines for dog waste violations
Own a multifamily? Dog waste can be a huge problem in common areas.
But it doesn’t have to be. If you don’t want your public outdoor areas littered with landmines, here’s a simple solution: Collect a doggie DNA sample (a cheek swab) upon signing new leases and include a hefty (e.g. $500) fine for un-picked-up dog waste.
Make it very, very clear to new tenants that all pet poo will be tested by a DNA service to identify the offending dog owner.
Once again, this works both as a preventative deterrent and a source of revenue if tenants don’t comply.
This may seem like an overly aggressive tactic for some real estate investors. Having said that, it’s certainly a viable solution if too many reckless renters make it a problem for others living in your investment properties.
Pets can be good business (if you protect yourself)
People love their pets. They’re family members. Pet owners are willing to pay more or to accept other inconveniences, for housing that meets the needs of their furry family members.
As a landlord, you’re an entrepreneur, whether you think of yourself as one or not. You have opportunities to earn more money by specifically targeting underserved sectors of the market.
Find ways you can appeal and market to pet owners, and you’ll find loyal renters willing to pay extra, stay longer, and accept more liability than their peers.
Next up, we’ll talk about ways landlords should protect themselves from pet-related damage and liability. Offense and defense – both are critical if you want to win the landlording game!