The pros and cons of allowing pets in rental properties

BMT team — Sun, 16 Jan 2022 21:38:41 +0000

As a landlord, one of the many considerations to make when looking for suitable tenants is whether to allow pets. About two-thirds of Australians own a pet, and while most states don’t have laws restricting tenants’ rights to own pets, many landlords include a clause in their leases that prohibit pets, which is within their legal rights to do. A major reason for landlords to include these clauses, is the perception that pets can devalue a home through damage to the property such as chewed up carpets, unpleasant odours and stains and moulting of fur. However, not all pet owners can be deemed irresponsible. Typically, pet owners will pay higher rents for the premium of having a pet friendly home, so will it work in your favour to consider adding ‘pet friendly’ to the lease? To help you decide, here are some pros and cons to consider before deciding if your property will be pet friendly or not: Pros of a pet friendly property You may be able to charge higher rent and thus achieve higher rental yields You will get a higher response from advertising if you mention that pets are allowed Due to this increased interest, your property may rent quicker and avoid vacancy periods where you are not earning rental income Pet owners generally stay longer as there is a limited number of pet friendly rentals available If tenants are mature enough to take good care of an animal, there is a good chance they will treat your property with the same respect If you are worried about pets damaging your investment property, you could ask for a refundable pet damage deposit Cons of a pet friendly property Individual pet owners might not be very good at cleaning up after their animals Pets can scratch floors, chew carpets and stain floor coverings, possibly leaving unpleasant odours Dogs barking, birds squawking and cats wandering can become a nuisance to neighbours through noise and damage There is increased liability to the Landlord if the pet bites or attacks others Making the decision whether to allow your property to be pet friendly or not should be taken into careful consideration to ensure that it feels right for you and your investment property. Check your insurance coverage and liability for animals If you decide to have a pet-friendly property, you should check your insurance policy to find out what type of coverage you have. Make sure you know the amount of liability coverage your policy includes. Enquire with your insurance company if there are any exclusions to your coverage, such as if they have a list of ‘dangerous’ dog breeds which will not be covered under the policy. Include your pet policy in your lease You should include a ‘pet clause’ in your lease and require each new tenant to sign it. This policy should clearly state your pet policy (whether or not you allow animals) and your expectations of the pet owner. Make it clear that by signing the lease, the tenant agrees to these terms and if they violate these terms, it will be considered a breach of contract. What is a pet resume? The introduction of pet resumes can make it easier for tenants to secure an animal-friendly rental property and helps Landlords protect their investment properties. Pet resumes are designed so animals can make a good impression. It also gives tenants a competitive advantage, proving they’re serious about the rental application and finding the perfect pet-friendly rental. Allowing pets in rentals could provide great advantages to Landlords. Don’t just write off pet owners in fear that your hard-earned investment is going to be destroyed. With most Australian households owning pets and with pet-friendly rentals in such short supply, the right changes to a lease agreement can open up the pool of potential tenants significantly.

The post The pros and cons of allowing pets in rental properties appeared first on .

Should you turn your investment property into a doghouse?

Bradley Beer — Wed, 22 Oct 2014 22:58:04 +0000

Pet owners could be your solution to increasing rental yield It’s no secret that property investors hate pets in their investment properties. They can be unpredictable, messy and destructive. It should come as no surprise that internal research conducted by realestate.com.au has shown that approximately only 5% of their rental listings are pet-friendly. However, for property investors concerned with improving their rental yield, reconsidering this preconception could provide thousands of dollars annually in additional rental income. Doing the math Property investors often associate pets with higher maintenance and overall costs, but extensive studies conducted in the US have shown differently. ‘Companion Animal Renters and Pet-Friendly housing in the U.S.’ found that pet-friendly properties are typically leased out in nineteen days, compared to the twenty-nine days it takes on average to find a tenant for a pet-unfriendly property. Assuming weekly rent of $450/week, this already leaves the pet-friendly property owner $641 better off once both properties are tenanted. Australian research has also shown that pet owners are willing to pay between 7-14% more rent for the right to keep their pets. For the purposes of this exercise, this will increase the rent for the pet-friendly property to $500/week. For a twelve month lease, this extra $50 a week will add up to $2,600 in additional income. Pet owners also stay longer; because it is so difficult to find pet-friendly accommodation, they are usually very reluctant to move on. This means that the properties’ owners have half as many vacancy periods to worry about. With an average vacancy period of twenty-nine days for investment properties that do not allow pets, on average this adds up to another $1,859 in lost income. In regards to the costs of additional damage caused by pets, research data has defied expectations by showing that there is little, if no, difference in overall maintenance and repair costs for investment properties with and without pets. Given how difficult it is for pet owners to find accommodation, they have a vested interest in ensuring that no harm comes to any rental property they manage to secure. With so few rental properties allowing pets on the market, the overwhelming demand for pet-friendly properties also allows owners to be far more selective, screening potential tenants and their references to ensure that they are not only responsible pet-owners, but responsible tenants as well. Due to these factors, the total difference in annual damages found in the U.S. research between tenants with and without pets was only $39USD, which was not judged as substantial enough to form a statistical difference, especially considering all the financial benefits received by keeping properties pet friendly. A much more significant cause of property damage, according to the same data, was children. Families with children were found to cause an additional $150USD damages over childless tenants each year. Fortunately, not many property investors were made aware of these results, sparing us from a lot of angry, homeless parents and some very pleased pets. Crunching the numbers, the difference in rental yields of properties that allow, and prohibit, pets ends up looking like this: For investors looking to increase their rental yields, allowing pets on a property is a far more cost effective solution than undertaking a costly bathroom or kitchen renovation. If concerns for damages still weigh on your mind, Pet Agreement Forms are readily available online, allowing investment property owners to more strictly regulate the terms on which pets may be kept on the premises.

The post Should you turn your investment property into a doghouse? appeared first on .

» pet friendly

The pros and cons of allowing pets in rental properties

Should you turn your investment property into a doghouse?