Is subletting the biggest issue in lettings today?
Time to think again if you assumed subletting was a social housing problem. The private rental sector is far from immune to unscrupulous or misguided tenants, with subletting fast turning into a silent industry epidemic.
There is a shortage of affordable rental property, especially in cities where recent graduates, young professionals and migrant workers are searching for accommodation on meagre budgets. Until the Build to Rent programme delivers a deluge of rental properties, many tenants are competing to pay the lowest monthly rent. The situation is clear: a house will be more expensive to rent than a flat; a flat will be more expensive to rent than a room; a room will be more expensive to rent than occupying a friend’s sofa.
And that’s where the problem lies. There is a keen and growing audience looking for cheap let accommodation. There is also a growing band of tenants who can see potential in the property they already let. Driven by economics on both sides, sub-letting needs no fuel adding to its fire. A tenant struggling to pay the rent may let a room in the property to cover the bills. A renter on a budget would find it hard to refuse a cheap room in a decent house. It’s easy to advertise on Gumtree or Facebook for an additional occupant or two – and who’s checking?
Subletting is illegal and very damaging. When a tenancy agreement is signed, only those mentioned in the paperwork are legally allowed to inhabit the property. Even a boyfriend moving his girlfriend in without the landlord’s permission will break the tenancy agreement and potentially invalidate any home insurance. More people under one roof will create more wear and tear, more potential for damage and more mould-inducing condensation, presenting the landlord with increased maintenance issues. And what if a brought-in secondary tenant is unhappy with the ‘makeshift’ landlord – i.e. the original tenant? Who do they complain to? Is it unthinkable that your registered tenant might even have taken a deposit from the sub-let renter? Tenants can play letting agents at their own game and it has the potential to get messy in a poacher turned gamekeeper scenario.
If you’ve dropped the ball when it comes to mid-term inspections, now might be the time to schedule some property visits. Tell tale subletting signs include more toothbrushes in the bathroom than the number of tenants specified on the agreement; evidence of sleeping in the living room and increased utility bills for landlords who have provided an ‘all-inclusive’ rental package. Subletting is costing landlords thousands of pounds: don’t let it cost you your client.
* Dave Hunt is the Business Development Director of the ARPM Group, which provides national outsourced lettings and property management services.
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