Be wary of sub-letting scams!Make Text Bigger
I just wanted to share with landlords that sub-letting scams are on the rise!
It is my belief that these scams produce three lots of victims …. the landlord, the sub-let tenants, and the wider landlord community, who get wrongly blamed as well and lumped into the anti-landlord campaigns run by the likes of Shelter.
Some sub-let scams are genuine scams, set up with intent to defraud … others are the result of someone who has been on a Rent2Rent course and has been taught how to sub-let a property and collect the difference between what the head tenant pays to the landlord and the rent they collect from the sub-tenants.
It is important to note that sub-letting a property will almost certainly be a breach of the T and C’s of your mortgage & insurance conditions. It may also turn your property into a licenceable HMO for which YOU could be fined.
I have seen a newbie fresh off a Rent2Rent course ask on a forum: “I’ve let a property, but I haven’t been able to let out any of the rooms yet. Can anyone give me advice of how to avoid paying the landlord rent until I have let the rooms”.
If things go pear-shaped, the head tenant has very little skin in the game and can disappear, still collecting rent from the sub-tenants. It may be weeks or months before the landlord realises what has happened and then he is left with tenants that he has no AST with.
One of the warning signs of a sub-let is a single person looking to rent a much bigger property than they need.
Regular property inspections are recommended to ascertain the situation at the property.
Landlord Action have just taken on a case where a property inspection revealed that the head tenants had put a partition up in the lounge to make another bedroom and had sub-let the property to 8 tenants!
For legal comment on the problems of sub-letting and Rent2Rent, please visit Property Tribes where we have a number of video interviews with various industry professionals here.
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