Minimising the Risk of Subletting

Subletting is a real risk to landlords and often the dangers are under-appreciated. Not only is it the case that your tenants are creaming off profit from your property by acting as an intermediary agent, but as you’ve never signed a contract with whoever your tenants are subletting to they have no legal entitlement to your property. You can never be completely sure if your tenants are subletting but there are a few things you can do to help minimise the risk.

Completely Contract it Out

Most contracts do have some sort of subletting clause contained within them, but it’s not always made clear to tenants. You need to let your tenants know in person that subletting is an offence that you could evict them for and that there will be serious penalties if they are caught. You should ensure that your contract has scope for you to impose these penalties.

Know the Risks

The highest risk periods are at the beginning and at the end of your contract when tenants are most likely to have the property empty. In general people aren’t keen to let their property to others while they’re still living in it and, normally, subletting isn’t too much of a problem mid-contract. You should also keep an ear out for if your tenants mention they’re going away for any long periods.

Be Clear About Occupancy

Sometimes tenants rent a property and don’t actually move in for another month or so. This is fine, but you should be sure they are keeping you informed. Empty property should be covered by unoccupied property insurance and you need to know when it’s appropriate to change your policy. This way you can ensure you know if there are going to be any periods where your property is going to be empty.

If you’re ever suspicious that your property is being sublet, just give a call. If someone unexpected answers the phone you may be onto something. In general contractual provisions should be enough, but you can never completely rule out the risk of subletting.