The risks and pitfalls of subletting a rental property
Cath, Assistant Lettings Manager, discusses why subletting isn't always a sensible idea for renters...
Estimated reading time: 3 minutes.
Subletting can often seem like a tempting option for tenants looking to earn extra income, but it can come with a lot of risks and pitfalls. Besides, in most cases, subletting is not allowed according to the terms of most occupation contracts. Renters who sublet without seeking permission from their landlord are likely to be in breach of their contract and risk losing their tenancy altogether.
Here are some of the risks and pitfalls of subletting a rental property:
Subletting may violate your occupation contract
Before you consider subletting, it is important to read your tenancy agreement carefully. Most tenancy agreements explicitly state whether you have the right to sublet part or all of the property and whether you must consult your landlord first. Violating your tenancy agreement by subletting without permission can result in legal action and even eviction.
Impacts on benefits and tax credits
If you receive benefits or tax credits, subletting may affect these. Renters who sublet their rental property may see a reduction or loss of their benefits or tax credits. It is important to consult an advisor to determine how your additional income would affect your entitlement to benefits or tax credits.
Council tax
If you sublet a single room, you may lose your single occupancy reduction on your council tax. This can result in a significant increase in your council tax bill. Additionally, if your tenant is exempt from paying council tax, you will not be eligible for the single occupancy reduction.
Read: Why landlords and tenants should use an ARLA approved letting agent
Insurance considerations
If you currently have contents insurance for your rental property, you may need to revise this when you sublet. Subletting represents a change in circumstances, and as a result, your current policy could be invalid. Renters should consider the new costs when calculating how much to charge their prospective tenant in rent.
Responsibilities and obligations
If you sublet part of your rental property, you become a landlord and are responsible for the repair responsibilities that are set out in the Landlord and Tenant Act 1985. This includes responsibility for the structure of the home, pipework and plumbing, electrical wiring, water tanks, boilers, radiators, and fitted heaters. You will also be responsible for ensuring that the property is clean, decorated to a reasonable standard, and adheres to general health and safety guidelines. Additionally, you must ensure that all furniture complies with fire safety regulations, and you should have gas safety certificates, with checks carried out regularly by a recognised engineer.
Do you need a written agreement?
As with any form of tenancy, it is best to have a written and signed agreement. This way, nobody can be uncertain about their rights and responsibilities. It is also worthwhile having an inventory written up before your tenant moves in.
Subletting can seem like an easy way to earn extra income, but it comes with a lot of risks and pitfalls. If you're considering subletting your rental property, it is important to consult your landlord and read your occupation contract carefully.
Renters who sublet without permission risk legal action and eviction.
At CPS Homes, our lettings team is here to assist you in finding the ideal rental property in Cardiff. Whether you need expert advice or have specific requirements, we are available to discuss your needs in more detail. Contact us today by phone at 02920 668585, by email at enquiries@cpshomes.co.uk, or stop by one of our branches for a face-to-face consultation.
The information contained within this article was correct at the date of publishing and is not guaranteed to remain correct in the present day.
