Owners of puppy farms are making hundreds of thousands of dollars each year as regulatory oversight allows the online market for buying dogs on platforms such as Facebook and Gumtree to boom, according to animal welfare group Animals Australia.

Investigations by welfare groups have uncovered dog breeding facilities where puppies live in squalor, with no access to sunlight, where they are given tiny amounts of food and water.

"It's an industry we'd encourage the tax office to look into because there's a lot of cash changing hands and a lot of money being made," said Lisa Chalk, communications director at Animals Australia.

"You could have farms that are making $300-$500,000 a year on these animals, it's a lot of money and it's very lucrative.

"Most puppies are sold online these days and that has really helped puppy farmers thrive."

The Australian pet industry is estimated to be worth $8 billion annually, with 4.2 million pet dogs living in homes across the country.

Online stores, classified ads and posts on Facebook groups have helped facilitate the ease of buying dogs on the internet.

Advertisements posted online on Gumtree seen by the ABC list French bulldogs for $4,500, German shepherd puppies for $1,900 among hundreds of other listings. Many did not specify where the animals came from.

French bulldogs are listed for $4,500

A post on a Facebook group offered Pomeranian-cross-Husky puppies for sale for up to $4,800 each.

"Part of the online challenges of puppy sales is that there is no tangible tracking mechanism available so as to determine the growth," RSPCA's New South Wales chief executive Steve Coleman said in an emailed statement to the ABC.

"We are working with government to develop an education package that will provide consumers with a list of easy questions to ask regarding their online enquiry."

"If the breeder can't answer them, we will be asking the public to provide RSPCA and Animal Welfare League with those breeders' details."

'Most' of the 500,000 puppies sold each year are online

Animals Australia said just under half a million puppies are sold in Australia every year, with most sold online and around 15 per cent through pet shops.

"When you consider one puppy factory could have 60 breeding dogs and you start looking at the price of dogs, you start to see what kind of money these places are bringing in," Ms Chalk said.

"A lot of these transactions take place on the side of the road in shopping centre car parks, at gas stations or through pet shops as the middle person.

In a statement sent to the ABC, Gumtree said animal welfare was a priority for the site and it has worked in conjunction with the RSPCA to develop policies relating to the sales of pets.

"Gumtree aims to facilitate pets trade in a safe, responsible and successful manner that benefits both people and pets. Gumtree operates a report and takedown process and we rely on our users' feedback to keep the site safe and relevant."

In a statement, Facebook said its advertising policies "do not allow for any illegal products, services or activities".

Earlier this year, welfare groups expressed disappointment at the NSW Government shying away from implementing key recommendations from an inquiry into the mistreatment of animals at puppy factories.