The Australian rental market is finding itself in a bit of a puzzle. On the one hand, landlords are seeking good tenants willing to pay the rental fee, and on the other hand, many potential tenants have been turned down since they own pets.
With around 63% of Australian households owning pets, if you follow the stats from Animal Medicines Australia, then you will grasp that that is a large section of the population. This percentage includes a fair amount of potential rental tenants that own pets. And as pet friendly rental properties are exceeding demand, any investor should take note and investigate this trend for the possibility to earn a premium on their investment.
The factors that are leading to the demand for rentals
A trend developing in Australia is downsizing, and moving from a house into an apartment building. This trend is mostly driven by wanting fewer expenses, but also many people that are choosing to live alone or finding themselves without children.
The factors blocking the uptake of rentals
As so many Australians are pet owners, they are being blocked by a lack of pet-friendly housing. This being since most landlords are either being shortsighted in terms of how they view potential tenants with pets or a clause in the body corporate schemes that ban pets within apartment buildings. Either way, many proprietors are missing out on a growing trend and the opportunity of asking for a higher rental income as compared to tenants without pets.
Why invest in a pet friendly rental property?
For those landlords opting to allow pets, the rewards can be beneficial. This, as pet owners prefer to sign longer lease agreements than those without pets, according to Australian Companion Animal Council. A longer lease will mean a saving on advertising costs and the possibility of having a property standing empty. And additionally Australian Companion Animal Council found that responsible pet owners can be very good tenants that will abide by the house rules.
There could also be a financial benefit for property-owners. For their property could become more valuable in terms of demand. The implication would be that the agent or the proprietor could ask for a higher rental fee. As the rental supply is limited, particularly for decent housing, many tenants with pets would be willing to pay slightly more for a pet friendly housing.
Just a few things to remember
Once you realize that you could earn a better return on your buy-to-rent investment, you will want to make sure to sign a pet keeping agreement. This agreement is available on the Australian Companion Animal Council’s website, which also contains brochures that will provide you will some useful tips about renting to pet owners. But one thing that you should do when drafting a lease agreement is to note the pets in the lease. Furthermore, if you are allowing pets as part of the lease, then you need to make sure that they are covered by your insurance policy.
With the huge amount of people owning pets, and housing in shortfall, you could ask slightly more for your buy-to-rent investment property. Just ensure that the lease agreement is compiled correctly.