Will pet bonds make a difference?

The government plans to introduce 'pet bonds' for tenants with pets, aiming to address potential issues related to pets in rental properties. Many landlords are reluctant to allow pets due to concerns about risk; potential damage caused by pets include carpet damage from urine, scratches and biting.

The proposed change would allow landlords to charge tenants up to six weeks' rent as a security deposit, as opposed to the current four weeks maximum. However, we don’t think this will have a significant impact by itself.

What’s more important is that the proposed new rules aim to hold pet-owning tenants clearly liable for any damage caused by their pets. This is a change from existing rules, which only hold tenants responsible for careless damage, while accidental damage is typically covered by the landlord's insurance. The ambiguity of the current law, and difficulty enforcing it, means landlords can bear the costs of making good any damage after a tenant leaves – a strong disincentive to allow pets. 

It’s important for landlords to remember that despite potential risk, there is also potential reward in allowing pets. When advertising rental properties that allow pets, we assess their market rent as 3-5% higher than if pets were not allowed. This is because it widens the pool of potential tenants and increases demand. For a typical three-bedroom home, this could mean a $2,000 increase in income each year – not an insignificant amount!

It also pays to remember that the majority of ‘fur baby’ family members cause no problems at all. My team typically manages between 40 and 50 properties with pets, and issues only arise in a small minority of cases. Over the years we have seen dogs, cats, birds, rabbits, chickens, fish, guinea pigs and even chameleons!

By considering the benefits of allowing pets in rental properties, landlords can strike a balance between potential risks and rewards, ultimately benefiting both property owners and tenants.

Louise Benson, Head of Property Management
Barfoot & Thompson Milford
027 431 9536
milford.rental@barfoot.co.nz