Smart Property Investment published a great article discussing the pros and cons of allowing pets in a residential rental property. Most Placer County and Nevada County investment property owners that we work with hem and haw over the the question “Should you allow pets in your investment property?”. Typically, if there are new carpets in a rental home or no outdoor fenced areas, the automatic answer is no, for obvious reasons. However, this article also discusses ways you can make your Auburn rental property or Grass Valley rental property more pet friendly while also preserving your investment. The benefits of transforming your residential rental property into a pet friendly home: increased tenant pool, advantage over competing properties that do not allow pets, lower vacancy rates, and increased rental rates. Read below to decide if owning a pet friendly Placer or Nevada County Investment Property is right for you and your rental market!
If you are feeling hesitant about allowing tenants with pets to rent your property, it might be time to take another look.
Property investors have long been hesitant to list their properties as pet-friendly on the rental market. Fears that animals will damage their property prevent landlords from all the potential benefits of offering a pet-friendly property. It is important for homeowners to consider all the benefits and potential pitfalls before a decision is made, to ensure they are not needlessly excluding a large amount of prospective tenants.
Benefits of managing a pet-friendly property
• Listing your investment property as pet-friendly immediately increases your prospective tenant pool
• Your property has an automatic advantage over competing properties, without having to reduce rental prices – particularly in inner-city properties where pet-friendly properties are few and far between
• Advertising your investment property as pet-friendly makes the rental more in-demand, which reduces time and money spent on advertising
• If the demand increases significantly, you may look at increasing the weekly rent for the property. Tenants with pets are willing to pay more to secure (and then stay in) a property that fits their needs
• In-demand properties also have very short vacancy periods, limiting pauses in cash flow from rent payments
• Once a pet-owner secures a property, they feel ‘at home’ having their pets with them, and are thus less likely to leave. This creates a steady rental income for the landlord
• Pet-owning tenants also prefer to avoid the apartment hunt, as they are very aware of the difficulties of finding a pet-friendly place. This will ensure they stay put in your property
Pitfalls of managing a pet-friendly property
• Potential damage from animals chewing or scratching the property
• Potential odour from animals
• In apartment buildings, neighbours may be unhappy with the idea of living in such close proximity to animals
• Increase in homeowner’s insurance fees
How to make your investment property pet-friendly
Making slight modifications to your investment property can minimise the damage caused by tenants’ pets and the need for excessive maintenance.
Here are some easy things you can do to properties within your portfolio to make them more pet-friendly and reduce your long-term outgoings:
• Tiles or linoleum flooring is a lot more practical than carpet, as it is easier to keep clean and does not pick up odours, fur or waste stains. They are also both more practical than floorboards, as they are less likely to be scratch or stained. This is not only attractive to the landlord, but also the tenant, as day-to-day cleaning and maintenance is minimised
• Ensure outdoor space is securely fenced off to attract tenants with outdoor pets and reduce their stress levels
• Additional features such as doggie-doors have greater appeal to renters, and therefore warrant an increase in the asking rental price. This will also reduce potential damage to doors and windows as the pets won’t have to scratch to signal their intention to go outside
• Create a pet-keeping contract/agreement for tenants to sign with the lease, to agree on responsibility of any additional cleaning or repair costs within the lease period. This will make responsibilities clear and will likely reduce any confusion in the event of damage and/or at the end of the lease
Pets in apartment buildings
Keeping animals in the confines of an apartment is a more complex process than allowing pets in a house, townhouse or villa – and it may require more planning. However, it is certainly achievable.
When it comes to strata buildings, there are general laws in place that vary from state to state. As a general rule, strata communities have the choice of one of a selection of options regarding the acceptance of pets in the building.
Some buildings may not allow pets at all. Some may allow tenants to submit a ‘pet application’, and make a decision based on the type of animal, the breed and temperament, and any supporting documentation or references. The reason for this process is to protect the health and wellbeing of tenants and pets. Very large animals are unlikely to be accepted into an apartment building, as there is not enough space for the pet to live comfortably, and allow other tenants to live undisturbed.
With an increase in demand for pet-friendly rental properties, developers and strata managers are becoming aware of the benefits of running a pet-friendly building.
Developers could decide to design and construct their apartment building as pet-friendly from the get-go – which would mean many of the modifications and additions listed above would come as standard. There is also the advantage of tenants living among other pet-lovers, reducing the risk of upsetting neighbours and inter-building disputes.
Property investors can have tenants sign a standard Pet Keeping Agreement, which requires them to agree to a certain level of cleanliness, minimal noise, and responsibility for damage to the property caused by a pet. A Pet Keeping Agreement also gives the body corporate peace of mind, as they know the tenant is in breach of contract should they disturb the living environment for other tenants.
It is important for landlords to be covered by the right homeowner’s insurance, as terms change when pets are permitted in your property. Investors should do their due diligence when making the decision to approve a certain type of pet, as some pets are considered bigger risks than others, which can hike up your insurance premium.
There are plenty of low-maintenance pets that won’t have much of an effect, including fish and rodents in enclosed cages, as these animals are contained, easily cared for, and won’t provoke noise complaints.