Pets in your Investment Property

By
12/09/2013


Aussies love their pets. Australia has one of the world’s highest pet ownership rates and more than 60% of households own a pet. Pets outnumber humans by a ratio of 3:2, with the 33-million-strong pet population much higher than Australia’s 22 million people.

 

 

This begs a difficult question for property owners. Known to present a higher risk of damaging property, pets also offer tremendous advantages to investors who allow their tenants to keep them. The foremost is that the wider pool of potential takers on a rental property means you can potentially make more money. Your property will be vacant for shorter periods, and because a lot of other landlords don’t allow pets your tenants could potentially pay a higher rent for the privilege.

 

Still, there’s the potential damage and maintenance to consider and, even if you’re insured, higher insurance bills.

 

“I used to let all my tenants keep pets,” says Brisbane investor Brett Barnes. “I’ve found the problem isn’t the animals but their owners. They don’t house-train the animals and never take them out of the house. Then you end up with what I now have: a unit riddled with pet stains and scratches at the bottom of every door.”

 

To settle the debate once and for all, Your Investment Property elicited the responses of property investors and industry professionals to this question:

 

Is allowing pets worth it?

 

Paul Wilson – We Find Houses VERDICT: Yes

 

You can really make a rental advert stand out if you’re pet friendly. Pet owners often have less choice, so allowing your tenants a pet can open your property up to a wider market.

 

I personally have plenty of properties and they’re all pet friendly, although I usually have conditions. I tend to want to see the pets before I agree to take the tenant on, because not all pets present the same risk of property damage. Budgies and small animals rarely wreck properties, and female dogs, provided they are house-trained, don’t mark their territory so you don’t end up with that urine smell that’s remarkably hard to wash out.

 

At the end of the day, being pet friendly doesn’t mean the property needs to become Noah’s Ark. You have complete control over who you let into the property. If you’re worried that they have four dogs, three cats and a rabbit, take on another tenant instead.

 

Rob Farmer – RUN Property VERDICT: Yes

 

With thousands of rental properties under management we’ve seen everything that you can imagine related to keeping pets.

 

Many property owners do not want pets in their properties, and we respect that. But in the vast majority of cases where tenants have pets, they mix well with rental properties and we can usually work out arrangements that suit everyone. Tenants pay a bond that covers any damage to the property, but most times we don’t need to do any repairs resulting from pets.

 

Tenants with pets can find it difficult to secure rental properties as many landlords do not allow pets in their properties, but a common sense approach usually resolves most issues. Many real estate sites now offer a ‘pets allowed’ function for their property searches, so that makes the search for a suitable rental property much easier nowadays. 

 

Our experience is that quality tenants do the right thing by landlords, and if they have pets they are generally well behaved.

 

Greville Pabst – WBP Property VERDICT: Yes, under conditions

 

If you’re in Victoria, there are no specific tenancy laws governing the possession of pets. While individual leases may incorporate reference to the prohibition of pets that cause nuisance or destruction to the property, a landlord cannot refuse a request to keep a pet without just cause.

 

However, landlords may negotiate further provisions for tenants with pets. These may include:

  • pet references from previous landlords
  • an increase to the bond or an additional ‘pet’ bond
  • a greater frequency of inspections until it is established that the pet is not causing any damage
  • stipulations around the suitability of the type of pet for the property (larger dogs such as Rottweilers don’t usually suit a high-density third-floor apartment)
  • the tenant having the property professionally treated, namely carpets, every six months (and at the end of the lease), providing evidence that the requirement has been fulfilled

If it is shown that a pet has caused damage to the property or is a nuisance to other residents or neighbours, a landlord may issue the tenant with a notice advising immediate action, which may include permanent removal of the offending pet from the premises, in addition to repairing any damage to the property.

 

How to protect your property from pet damage

 

As well as getting landlord insurance, you can prevent a lot of the damage associated with pets by being strategic:

  • Insist that tenants’ pets be house-trained.
  • Agree with the tenant on a professional house cleaning schedule, say every four to six months, which they must pay for. This should involve removing stains and hair from carpets, and other maintenance.
  • Much of pet damage comes from pets who are bored. Cats and dogs chew and scratch because they have excess energy from having nothing else to do. Be sure that the tenants are the kind of people who regularly walk and entertain their pets.
  • Get tenants to provide the name and number of who would be likely to look after the pet whenever they are away.
  • Limit the number of pets allowed. Use the size of your property as a basis for what you think would be a conceivable number of animals to keep on the property.
  • Exclude exotic pets from what you allow tenants to keep.

4 reasons pets can be a landlord’s best friend

 

1. Higher tenant retention: Tenants who own pets tend to stay in properties longer.

 

2. More potential tenants: The sheer number of people looking for pet-friendly properties, yet failing to find them, means that more people will be attracted to your property.

 

3. Lower vacancy rates: Being pet friendly could mean you find a tenant more quickly. If long vacancy periods are common in your area and a pet-friendly approach might secure a tenant a week or more earlier, it might actually cost you more to not allow pets.

 

4. More rent: Low supply and increased demand raise prices. Properties that allow pets can often charge more in rent than those that don’t, simply because the large pool of prospective tenants with pets have few accommodation choices.

 

Rules for pets in apartment complexes

 

Many strata schemes adopt the by-laws set out in the Strata Schemes Management Act 1996 (NSW), which state that an owner or occupier of a lot must not, without approval in writing of the owners corporation/body corporate, keep an animal on the lot or the common property.

 

“By applying to the owners corporation, your tenant may be granted permission to keep a pet within a lot, although they may have to abide by certain conditions such as having a dog on a lead when on common property and cleaning up after it,” says Sydney property conveyancer Geri Forsaith.

 

Before asking for permission from an owners corporation, Forsaith recommends first checking strata records for the property and also finding out if other owners or occupiers have kept pets in the past. This often makes a pet request more persuasive.

 

Requests should be made in writing and should describe the pet, its disposition and level of training while also providing proof of necessary vaccinations, desexing, registrations and other details.

 

If pets are strictly not allowed and it’s discovered that you or your tenants have sneaked one in, you will be forced to comply with the by-laws of the strata plan. Further failure to comply will result in fines.

 

HOT TIP: This template pet resume may help you get approval for your furry friend.

 

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