We investigate how smart property investors in the Australian market are making their property the most in-demand in their area.
Australia has one of the highest rates of pet ownership in the world. About 63% of Australian households own pets. There are an estimated more than 25 million pets in Australia, according to the Australian Companion Animal Council.
If you exclude every rental applicant who owns a pet, you’re removing a huge number of people to select from in your rental pool – 60% in fact. A recent survey by the Real Estate Institute of Australia showed that 40% of investors don’t allow pets, and 28% weren’t sure if they would or not.
The decision to allow pets into your investment property is a big consideration – not everyone has the same standard of care and hygiene and training as you and your own pet might.
So while you may want to rule out tenants with pets – why not look at the flip side, and make your property one of the most sort after in your area instead?
So how can Landlords benefit from allowing Tenants with pets in their rental properties?
• Higher rental prices. Pet owners may be willing to pay a little more annually if it means the difference between keeping their pet or not.
• Longer tenancies. The Real Estate Institute of Australia (REIA) says that tenants with pets tend to stay in the same place longer, to avoid disruption to their animals, & because it is difficult to find other pet-friendly properties. Just ensure your agent makes regular property checks to monitor that the property is not being damaged by the pet.
• Larger pool of applicants. Having a property that’s desirable to a significantly larger pool of households – and in fact, one that sets it apart from most of the other listings on the market – can significantly reduce downtime between tenants.
• Responsible tenants. If you have clearly written into the contract that they are responsible for all damages then they realise from the start that they will ultimately be responsible for the cost of any repairs for damage.
• Security. Allowing a dog can deter burglars and vandals.
So how can investors reduce the risk of pet-related damages?
Include specific clauses in your lease agreement relating to pets, such as:
• The types of pets allowed (for example: fish, rabbits, small dogs, cats).
• The number of pets that can live at the property.
• Living arrangements; such as whether dogs are allowed inside or outdoors only.
• Choose to cover your floorings with wood look-alike linoleum (also known as vinyl) instead of carpet.
• Include a pet disclosure clause in the contract stating that tenants must advise all of their pets to the managing agent, before their tenancy is approved.
• Ask your Managing Agent to request for a Pet Resume and any obedience training done to be included with short-listed tenants and any historical behavioural issues such as constant barking or separation anxiety leading to damage.
• Ask your Managing Agent to rule out animals that don’t suit your property; for example, if you only have a small courtyard, only tell them to only allow small dogs, and not medium to large sized dogs that may require more exercise or have the muscle-power to jump the fence when the tenant isn’t home.
The Residential Tenancy Authority says that the responsibility and costs for any repairs ultimately lies with the tenants for any damage made by their pets.
As a landlord, a property that is constantly rented out means financial peace of mind and is very appealing for fellow investors if you choose to sell in the future.