The number of tenants subletting their homes is increasing, leaving them at risk of fines or eviction.
One in six tenants in the UK have rented out their property to someone who isn’t on the lease agreement, according to Direct Line for Business.
The research found that a quarter (25%) of tenants who sublet their property didn’t check the terms of their lease to see if it was permitted, while over a third (34%) had told their landlord.
Of the subletters who did not inform their landlord, one in five got found out in the end anyway.
There can be severe consequences for tenants that are caught by their landlord subletting.
In 11% of cases the tenants named on the lease were evicted with 6% losing their deposit in the process. Nearly a quarter of all landlords increased rental charges (22%), while 22% issued a fine or a formal warning.
Direct Line for Business’s research revealed that there could be an increase in the number of people subletting their properties this year.
One in six renters (15%) claimed they are thinking about subletting part or all of their rented property by advertising on property letting websites such as Airbnb .
Nick Breton, head of Direct Line for Business, said: “The average monthly rent across the UK currently stands at £7392. This means on average, approximately a third of people’s income goes towards accommodation3. With the market having seen a five per cent increase in average rents in the last year, it seems that a larger number of renters are tempted to offset this expense by subletting their properties.”
Over the last two years, Landlord Action has seen an 18% increase in the number of instructions from landlords with subletting cases.
Paul Shamplina, founder of Landlord Action, said: “Subletting is fast becoming one of the leading grounds for eviction, alongside rent arrears and Section 21 for possession only. This has been fuelled by sky high rents preventing some tenants from being able to afford even single-unit accommodation, forcing many to resort to bedsits or shared accommodation.
“Organised subletting scams are also becoming more prevalent, where tenants, or sometimes even fake tenants, advertise properties and rooms on holiday/accommodation websites in order to cream a profit without the landlord’s consent.”
Subletting is most common in the North West and West Midlands, where more than a quarter of private tenants say that have sublet their properties, followed by London. Tenants are least likely to sublet their properties in the South East and Northern Ireland.
“There could be some serious consequences for tenants who sublet, but landlords need to be aware that in these circumstances there could also be insurance implications. Subletting is not covered under most insurance policies, so it’s really important that landlords make their tenants fully aware of the restrictions on the lease and maintain that communication that can help prevent any future breaches,” said Breton.
