Does Pet Policy in a Condominium Building Impact Property Values?

Pets are permitted in some condominium buildings and not in others. Pet owners will therefore be attracted more towards buildings that welcome pets than otherwise. However, the pet-related regulations may altogether restrict all sorts of pets, including small pets, such as cats, while others may include restrictions on the number of pets allowed per unit, certain breeds or set restrictions on the permissible size of a pet. These restrictions may impact the price of condominiums. Using a hedonic price model, this research paper analyses whether and by how much allowance for pets in the building impacts property values in downtown Toronto using condominium sales data from January 2016 to December 2017 and information derived from a pet policy questionnaire. The findings suggest that the price differences are not statistically significant between buildings that allow pets or otherwise. In fact, the real price difference is observed for the degree of pet friendliness. Condominium buildings that allow two or more pets sell for higher prices than those that allow less than two pets. Furthermore, condominium buildings that allow two or more dogs sell for a higher price. Also, condominium buildings that impose weight, size or breed restrictions cost 5.7 percent more than those do not have those restrictions. Keywords: hedonic price model, pet policy, condominiums, GIS, Toronto

Does Pet Policy in a Condominium Building Impact Property Values?

Pets are permitted in some condominium buildings and not in others. Pet owners will therefore be attracted more towards buildings that welcome pets than otherwise. However, the pet-related regulations may altogether restrict all sorts of pets, including small pets, such as cats, while others may include restrictions on the number of pets allowed per unit, certain breeds or set restrictions on the permissible size of a pet. These restrictions may impact the price of condominiums. Using a hedonic price model, this research paper analyses whether and by how much allowance for pets in the building impacts property values in downtown Toronto using condominium sales data from January 2016 to December 2017 and information derived from a pet policy questionnaire. The findings suggest that the price differences are not statistically significant between buildings that allow pets or otherwise. In fact, the real price difference is observed for the degree of pet friendliness. Condominium buildings that allow two or more pets sell for higher prices than those that allow less than two pets. Furthermore, condominium buildings that allow two or more dogs sell for a higher price. Also, condominium buildings that impose weight, size or breed restrictions cost 5.7 percent more than those do not have those restrictions. Keywords: hedonic price model, pet policy, condominiums, GIS, Toronto