How Pets Can Drive Revenue

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The benefits of having pets on property are extensive, from happier residents and increased social opportunities to providing a generally more attractive place to live. Allowing pets can serve as a boost to the revenue stream as well.

To be clear, if the primary reason you’re allowing pets is because you see dollar signs, you’re probably doing it for the wrong reasons. But an uptick in revenue can be a positive consequence of a noble, forward-thinking approach to pets.

Here are some of the ways a responsible pet policy can have a helpful impact on the bottom line:

Nonrefundable Pet Fee and Pet Rent

The most obvious forms of pet-driven revenue often consist of an upfront nonrefundable pet fee and monthly pet rent. Most communities charge either one or the other. It’s our recommendation to charge a reasonable range here based on the risk you are undertaking. A puppy, for example, should yield slightly higher pet fees and rents because of the obvious risk any puppy presents. Of course, it’s wise to avoid any potentially off-putting exorbitant pricing for either. Most pet-owning residents are happy to pay a reasonable fee in exchange for having their pet or pets live with them. These fees can help properties offset any potential damages and give an ancillary boost to the revenue stream.

Wider Pool of Residents

Pet-friendly communities have more potential residents to choose from, because pet-owning renters have become increasingly diligent about finding living destinations in which their furry friends will be welcome and happy. With approximately 70% of households owning pets, according to numerous studies, this is a sizable demographic. Simply allowing pets, however, isn’t enough to sway these discerning renters. When envisioning a space in which their pets will thrive, they will research your pet amenities, pet limits, and overarching pet policies. Properties that create truly welcoming and supportive environments for pet owners will have the best chance at attracting these residents.

Longer Stays

It’s no myth that residents will move if their pets are uncomfortable. According to the Pet-Inclusive Housing Initiative Report, residents in pet-friendly housing stay an average of 21% longer than those in non-pet-friendly housing. Pet-friendliness works as its own resident-retention tool, as happy pet owners are much more likely to renew their leases. A shining example in recent years was provided by Atlanta-based The Management Group (TMG), which experienced an unprecedented 80% renewal rate among pet owners after revamping its pet policies. In fairness, TMG helped reach this high rate by eliminating pet fees of any sort. The idea was that keeping residents in the building provided much more of a net operating income boost than constantly turning homes. While 80% retention might be ambitious, a forward-thinking, pet-friendly approach has the potential to significantly increase renewal rates.

Partnerships With Local Pet Services

Teaming with local pet service providers can create benefits for everyone—the resident, the provider, and the property. Partnering with a local veterinarian, dog walker, groomer, or pet concierge service offers preferred providers for residents, drums up business for the pet services, and can create a possible referral revenue stream for the community. Properties have also been known to partner with adoption agencies and to host on-site events when mobile dog groomers, pet photographers, and other pet-centric vendors visit the property. More than ever, pet owners are eager to spend on various types of pet services. Data from the U.S. Bureau of Labor Statistics shows that pet spending increased 77.9% over a recent eight-year span.

While these ideas have the potential to create a revenue boost, they should primarily be rooted in providing an increasingly pet-friendly experience. Easing pet restrictions, understanding the risk profile for each pet and its owner, boosting pet limits, and effectively managing assistance animal processes will also help in this pursuit—although those are topics more extensively discussed in previous columns. In short, forward-thinking modern-day pet processes first create an amazing pet experience and, by consequence, can augment the revenue stream.

Source: Multifamily Executive