Landlords: how to spot signs of subletting
Subletting is when a tenant turns landlord themselves. Instead of living in the property they have signed the tenancy agreement for, they rent out the property to others – either on an entire house basis, room-by-room or even as an Airbnb. Subletting is a way for tenants to make money, as they charge other tenants more than they are paying the landlord to make a profit.
The intention to sublet often goes under the radar as the legitimate tenant will move in friends, use word-of-mouth to attract people or advertise the property/rooms on social media platforms and places such as Gumtree – all of which are hard to track.
Is subletting illegal?
The answer is sometimes. The act of subletting is usually prohibited, as set out in the tenancy agreement, and the landlord’s mortgage may also forbid subletting. Therefore, the landlord is within their rights to take legal action against tenants who sublet.
There’s also a note of caution when it comes to tenants who turn a property into a HMO (a house in multiple occupation, when rooms are rented out to different individuals with shared communal facilities). A recent case saw the original tenant of a four-bedroom house fined over £9,000 and receive a criminal record for subletting, while the property owner/landlord was also fined. Both parties were guilty of breaching housing laws and not obtaining the correct HMO licence.
The property owner who fell foul of subletting was reported to have visited the property ‘occasionally’ in their role of landlord but missed clues that eight people – instead of the sole tenant who signed the agreement – were living in their property. So would you miss the signs of subletting?
Subletting signs you need to recognise
If you are a landlord who suspects subletting in a property you rent out, you need to keep a vigilant eye on the following: –
- Living areas that have been turned into bedrooms, such as dining rooms and lounges
- More toothbrushes and towels than required for the number of tenants on the original agreement
- Makeshift sleeping arrangements and bundles of bed linen on sofas and possibly in outbuildings
- More domestic waste and recycling than you would expect for the number of tenants on the original agreement
- If the property is rented as ‘bills included’, heavier use of utilities than during previous lets
- Signs of increased wear and tear around the property
- Reports of extra noise, unexplained comings and goings, or anti-social behaviour from neighbours
- The original tenant refusing access to the property for an inspection
- Different people frequently arriving with suitcases
Lodgers & holiday lets
Tenants should know that although the Government’s Rent a Room Scheme is perfectly legal, most tenancy agreements will prohibit tenants taking in a lodger, whether for financial gain or not. Holiday lets are another area of concern, especially with the popularity of staycations. An estimated 120,000 properties in the UK are illegally sublet through sites such as Airbnb. Landlords should also note that subletting for illegal activities is just as popular as offering properties to holidaymakers.
Why is subletting an issue for landlords?
Subletting means tenants move into a property without undergoing reference checks – there’s no official record of their past behaviour, their status to rightly reside in the UK or their ability to pay the rent. Even a tenant allowing a friend to sleep on the sofa could be classed as subletting, and can be detrimental to the condition and value of the property, not to mention jeopardise legal compliance.
Professional property lettings: the advantages
Choosing to work with a professional lettings agency is the best way to avoid subletting. A good property manager will ensure any tenancy agreement has a clear no-subletting clause and they will undertake thorough tenant referencing to detect previous bad tenant behaviour.
A lettings agency will make tenants aware of regular planned property inspections – which can act as a subletting deterrent – and if there is any hint of subletting, they can diarise more frequent visits. Don’t forget, a lettings professional will spot the more subtle signs of subletting and may also spot if your buy-to-let appears as ‘to let’ on property portals. If you’re worried about subletting, speak to us today.