The growing Airbnb phenomenon is posing a threat to landlords, whose landlord insurance could become void as a result, according to leading tenant eviction firm Landlord Action.
Over the last 12 months, the number of cases that Landlord Action has received concerning tenants that have sublet properties without their landlord’s permission has trebled.
Aside from breach of tenancy agreement and additional wear and tear to the property, landlords could also be found to be in breach of their mortgage terms and buildings insurance.
Airbnb is giving tenants a platform to view themselves as a business. However, it also enables those that don’t have the right to profit from someone else’s property. The issue is set to be highlighted in Channel 5’s Nightmare Tenants, Slum Landlords tomorrow night at 9pm.
The episode shows Joy Philips, a landlord who decided to let out her home in West London so that she could afford to volunteer at an orphanage in Africa. Joy believed she had found the perfect tenant; a young doctor who wanted her home for a three-year lease. However, Joy started receiving calls and emails from her neighbours, complaining about the amount of people coming and going from the property.
Joy was shocked to find out that her property was not being used as a home for the young doctor, but being rented out room-by-room as a boutique hotel on Airbnb.
The tenant, making thousands of pounds above the rent being paid to Joy, was breaking the no subletting clause of the contract. By having so many people in the house, Joy’s home insurance was also at risk of being void. She was forced to give up her volunteer work in Africa and return to the UK, when she called in eviction specialist Paul Shamplina, the founder of Landlord Action.
Shamplina, speaking to Richard Quest on CNN about the issue, says: “We have had concerns for some time now regarding the protection of properties which are being uploaded and offered as holiday lets via Airbnb.
“We continue to receive a growing number of instructions from landlords who want us to start possession proceedings against tenants who have sublet their property via Airbnb without consent.”
He explains: “Whilst Airbnb do provide a level of protection for hosts, naturally certain conditions and limitations do apply. My concern is that there is not enough safeguarding with regards to obtaining proof from the individual who is advertising the property that they are the legitimate owner. Or, if they are a tenant, that they have consent from their landlord to rent out the property in this way.
“We have seen cases where, quite clearly, tenants are making thousands of pounds from exploiting the service to a high volume of holidaymakers on a weekly basis. In a recent case, it was thought that more than 300 people stayed in a landlord’s property in one year, unbeknown to the landlord.”
Shamplina continues: “As well as damage to properties, landlords have received complaints from block managers with regards to being in breach of their head lease and unhappy neighbours in relation to anti-social behaviour, and that’s before considering issues regarding HMO [House in Multiple Occupation] licensing and possible invalidation of insurance and mortgage terms.
“This is a growing trend, which needs to be stamped out as soon as possible. It’s extremely important that if landlords start to receive complaints, especially if they have never had any such trouble in the past, that they carry out an inspection of the property to ensure it is not being used in this way without permission.”
We have tips on how to inspect your rental properties: https://www.justlandlords.co.uk/news/carry-inspections-btl-property/
Remember to ensure you know who is living in your property to avoid your landlords insurance becoming void.
You can follow Joy’s story on Channel 5 tomorrow night at 9pm with Paul Shamplina.