It's not uncommon for subletting to go unnoticed by landlords, so what do you do once the discovery is made? Below we've outlined the best approach to prevent it, and what course of action you should take once you realise your tenants are subletting without your permission.
Why is Subletting a Concern?
Some insurance policies don’t allow for subletting in their policies, potentially making your policy void when you go to make an insurance claim – a worrying issue if any damage does occur in your investment property.
There is a risk that the subletting tenants may not take good care of your rental property – plus, you didn’t hand pick them, get a chance to check their references or conduct credit checks, so how can you be sure they’re reliable?
If the occupant who is subletting causes damage, you must pursue the original tenant for any re-compensation, which can prove difficult if they’re no longer contactable.
How Can You Prevent Subletting?
Carry out quarterly property inspections – showing tenants you’re keeping a good eye on the property should ensure they’re aware you take a close interest in the property and that they should communicate any changes to you.
Put a clause in your tenancy agreement forbidding subletting.
When your tenants are signing the tenancy agreement ensure you tell them no subletting is allowed to prevent any misunderstandings.
What If I’m Okay With My Tenant Subletting?
Subletting can be beneficial to the landlord if the tenant needs help paying their rent on time or wants to get out of a fixed term tenancy without causing a huge issue. However, it’s important to remember that even if the tenant sublets and moves out of the property, the original tenant, not the person subletting, is responsible to the landlord. If you ensure the subletting tenant is properly letted a good outcome is much more likely.
You Should Request a New Tenancy Agreement
To protect everyone’s rights and responsibilities, if you find your property is being sublet ask the new occupant to sign a written tenancy agreement so they become the new tenant. This should be done only if you are prepared to end the agreement with the original tenant.
Final Word
Subletting has its pros and cons depending on the situation, however we strongly recommend you ensure your rights are covered and you continue carrying out regular property inspections to ensure your property is being well looked after.
If you're considering Property Management get in touch with us today. Locally owned and managed, we offer residential property management services across the entire Wellington & Hutt Valley region.
We take care of investments, offering peace of mind and a personal service to investors and tenants alike. Our solutions are backed by industry-leading technology and proven systems that promote both excellent property care and strong investment returns. Taking on all aspects of the landlord’s role, we guide our clients with professional, tailored advice using our extensive experience and insight in the rental market that can only be built over time.
If you would like to chat about the possibility of working together, or to receive a no-obligation, FREE Rental Appraisal get in touch with our team today.
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