Should you rent to people with pets?

Should you rent to people with pets?

Whether to enforce a blanket ‘no pets’ policy or consider allowing tenants to keep animals is a conundrum for many Australian landlords.

It’s a topic that recently made its way onto the government agenda in one Australian state. Victorian premier Daniel Andrews hit the headlines in October when he mooted the ban of unreasonable ‘no pets’ clauses in tenancy agreements, as part of an overhaul of the state’s Residential Tenancies Act.

As a nation, we love our pets and collectively own 25 million of them, including 4.2 million dogs and 3.3 million cats, according to the RSPCA.

So what are the pros and cons of renting a property to pet owners? Do you limit the options, or safeguard your valuable investment by refusing to consider applications from any folk with fur babies in tow?

Costing the damage

Damage that comes to mind includes soiled carpets, smelly floors, destroyed drapes, or a backyard where well-tended grass and flowerbeds are replaced by a pot-holed moonscape… Horror tales of canine and feline destruction are enough to make many landlord think twice about letting to people with pets, despite assurances that their animals are quiet and well trained, or won’t be allowed inside the property.

Sean Dunn, a leasing agent at Blues Point Real Estate in Sydney, says the fear is real. ‘There’s a stigma about animals in a rental, that they will cause thousands of dollars of damage that the bond won’t cover and which can’t be claimed on any landlord’ insurance policy,’ Dunn says.

It’s a reasonable concern, given there are some irresponsible pet owners amongst renters. Conversely, landlords willing to countenance the presence of a well-behaved Fido or Fluffy may fare better financially than those who keep the cat flap firmly locked.

Charging a premium

People with pets perceive they have limited choices in the rental market and stories of applications being knocked back or overlooked are common, according to a study on renting with pets published last year by Western Sydney University researcher Dr Emma Power. Some dwellings advertised as animal friendly aren’t safe or secure for them; a factor that further reduces the pool of properties available to renters with pets, Power’s study found.

This supply and demand imbalance can work in your favour if you’re a landlord who’s willing to consider an applicant with a companion animal. A pet friendly property can command a premium of 10 to 20 per cent over a comparable dwelling that doesn’t permit pets, if located in an area where there’s a supply shortage, according to Dunn. On a weekly rent of $650, that’s an additional $3380 to $6780 a year; a welcome boost for most investors.

Given the difficulties associated with finding a pet-friendly place, people with pets are likely to stay put for longer. For landlords, this means less time and expense looking for tenants, fewer re-letting fees to pay and fewer weeks where a property sits vacant, Dunn says. Encouraging pet ownership can also have social and moral benefits, he adds. ‘The growth of a community is evident in pet friendly neighbourhoods and this is positive for society at large.’