7 Important Aspects of Subletting Everyone Should Keep in Mind
Many homeowners choose to rent out their property because they find the extra income to be an appealing concept. However, for every flat owner out there, there are many things to keep in mind, if they wish to make things work. In this guide, we will have a look at the most important points.
What is subletting?
Many people seem to confuse what subletting is. Essentially, this is letting out your property to another party, while you live somewhere else. Many leases list this as acceptable, even if there are certain requirements. Taking in a lodger can also be classed as subletting, especially when you give them rights over your flat, or parts of it. Some leases will not allow this, as it comes in the form of ‘alienation.
What is in the lease?
The key thing to know is to consider what the lease says. Some time ago, when the first leases were created, subletting was not a thing. Leases didn't need to include any clause about subletting. But nowadays things are different. That is why it is important for anyone wishing to sublet to check their lease agreement. It may be the case that it forbids subletting specifically.
Does it apply to garages?
Alienation does apply to garages, as well as parking spaces and out-building included within the demise of the lease. For anyone wishing to sublet their flat, they have to include any such component in the tenancy. That means if you own a flat with a parking spot/garage, you cannot sublet the latter alone. Only if you have a separate lease for the garage or parking spot can you consider subletting them.
How long can you sublet?
Typically, there is no limit on the sublet period, unless it is stated in the lease. However, it is usually the case that a letting agent will recommend a more sensible letting period, with a follow-up contract. Short sublets can be problematic. There are clauses that prohibit businesses being run on the premises, as well as more than a single household using the property. This means that sub-letting a flat as an Airbnb can be somewhat problematic.
Who can you sublet to?
It is not the case that you can sublet to whoever you want. Once again, it depends on the lease and what conditions it has on who you are allowed to sublet to. For example, you may find that you can sublet your home to a single household. This makes it impossible to let an individual room as an individual tenancy.
Number of tenants
The size of the home usually places a limit on the number of tenants you can let it to. A lot of boroughs in London have a landlord registration scheme, which allows for home assessment for owners to obtain a licence for subletting to a certain number of people. For instance, a home of 2 double bedrooms will allow for a family of 4. But there are certain box rooms, which don’t meet the minimum requirement. And even without a landlord registration scheme, you will have to make sure the property is not overcrowded.
What about the money?
If you collect income from your home, when you sublet, you will need to pay tax on it. This means you need to carefully consider the outgoings if you want to make money this way. Many people fall into the traps of subletting without first talking with a professional about it, and it creates many problems for them.
