Subletting
Whether you’re a private landlord or using the services of a trusted letting agency it’s likely you have a legal contract with your reference-checked tenant. Handing over your keys to a stranger is stressful, so for most landlords finding honest tenants who pay the rent on time and don’t break anything is a top priority.
Most tenancy agreements have a clause about sub-letting to protect both parties in a dispute. The landlord is responsible for abiding by local licensing laws, and the tenant is responsible for any damage caused to the property. Many mortgage lenders and buildings insurance companies have similar terms and conditions, which helps ensure that rental properties are not sub-let. This better regulates the system, ensuring all parties observe local tenancy, short-let and HMO laws.
These laws protect landlords and maintain health and safety by preventing issues such overcrowding, fire hazards and unsanitary living conditions. Sub-letting properties is heavily deterred for good reason. Fines are hefty, and the costs of repairs to severely damaged property can be exorbitant for landlords who are left high and dry by bad tenants.
In a worst-case scenario, unexpected fire in an overcrowded home can result in life-changing injury and loss of life, with final responsibility ultimately resting on the shoulders of the likely-uninsured property owner, should the health and safety standards not have been properly met.
Case Study
Josh had been renting his 3-bedroom flat in Leeds to a respectful couple as a private landlord. They paid their rent, made some minor improvements to the property and seldom contacted Josh for repairs. They seemed like ideal tenants, until a neighbour mentioned there had been many comings and goings from the flat since the couple had moved in.
Worried that sub-letting may be invalidating his insurance policy, Josh contacted the team at Owl Investigations to place discreet surveillance on the flat. The couple were observed regularly greeting guests with luggage, with the average guest staying two nights.
We investigated numerous online rental sites and discovered the flat was commercially listed as a bed and breakfast, as well as for exclusive use. Reviews for the bed and breakfast dated back to the time when the couple had first moved in, and it was also discovered that the same couple had multiple other listings for similar rented properties in and around Leeds.
Owl’s investigation provided concrete proof that the couple had rented Josh’s flat with the intention of using it for personal financial gain. This put them in breach of their tenancy agreement, giving Josh grounds for eviction. Having sought legal advice, Josh is now in the process of claiming significant damages for the fraudulent commercial of his assets, and damages caused to his property.
By carefully investigating his tenants Josh has mitigated potential insurance claim issues and removed the risk of his mortgage lender withdrawing his loan agreement. He is no longer risking receiving hefty fines for breaching licensing regulations and can now find better, more trustworthy tenants.