If you’re a landlord who wants to understand subletting better – and how it might affect you, read on for a few things you should know.
There has been a significant increase in the number of tenants opting to sublet recently. This trend is due to several factors, not least the ongoing cost of living crisis. With many individuals finding it difficult to make ends meet, subletting has become an attractive option for tenants who feel they need to generate additional income and pay the bills. The rising property prices in the Brighton and Hove area only compound this.
However, subletting isn’t always done legally or safely. Some fraudsters seek to rent properties to make money from subletting them, putting landlords at serious risk.
Find out how you can navigate the do’s and don’ts of subletting as a landlord in 2023 to keep you, your property and your tenants safe.
Subletting happens when tenants rent out all or part of their rental property to another individual. Instead of paying rent to the landlord, it goes to the original tenant, who then pays the landlord. Tenants should ask for the landlord’s permission before subletting, but many don’t.
Subletting is illegal if the tenancy agreement requires tenants to seek permission to sublet, and they do so without getting it. It is also unlawful if a tenant sublets their home when the tenancy agreement specially prohibits subletting.
Tenants can legally sublet if they have received permission from their landlord.
More often than not, subletting is not a problem. Tenants may choose to sublet because their financial circumstances have changed during the tenancy, and they need help paying the rent and bills. Others decide they prefer to have a housemate for the company or opt for their partner to move in with them.
The soaring cost of rent has increased the number of subletting scams. Unscrupulous tenants look to take advantage of a rental property by charging their sub-tenants more money than they are paying in rent or by subletting the property to more people than appropriate. Classic signs of illegal subletting are a single person looking to rent a much larger property, a tenant who constantly rejects applications for access to the property or a build-up of rubbish that can’t be attributed to a single tenant.
If the lease agreement clearly states that subletting is not allowed or requires approval, and the tenant proceeds to sublet the property without obtaining permission, they would violate their agreement. This provides the landlord with the legal grounds for eviction using Section 8 of the housing act.
If you realise that the tenant is subletting the property without consent, it is best to have a conversation with them first. If the tenant has a history of being dependable and responsible, it may be worth working together to find a solution. For example, signing a new tenancy agreement that includes the subtenant might be possible.
However, if you can’t reach an amicable solution, then you will have to take steps to evict them. Since subletting can become a complex legal issue, you should contact a solicitor for the appropriate advice.
Before agreeing to a tenant’s request for subletting, landlords should confirm that their buy-to-let mortgage and landlord insurance policy permits it (as many do not). Landlords refuse permission wisely in such a circumstance.
Another potential drawback to subletting is that the landlord has no legally binding relationship with the subtenant. This can lead to difficulties during the tenancy, and if the landlord wishes for the subtenant to vacate, evicting them can be complicated.
If your tenant wants to sublet, there are several options available. The first step is to review your tenancy agreement to ensure that it clearly states your policy on subletting. If the agreement allows for subletting but requires the landlord’s permission, you can consider the taking the steps listed below:
Ultimately, it is up to you as the landlord to decide whether to approve the request, but it is important to consider these factors before deciding.
If this all seems stressful, you could consider our rent guarantee insurance. We are one of the only agents in Brighton & Hove who can offer this in these uncertain times. Get in touch today.
Do you have any questions about the topic above? Our team of experts is here to help in answering any query you may have.
Fueled by his desire to be the best, most reputable estate and lettings agent in town, Steve has spent his career cultivating The Property Shop. Steve prides himself on his authenticity, honesty, and knowledge-base which is emulated by The Property Shop and his team.
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