Just to back up my sentiments a recent case in London involving a 32 year old tenant Vivek Strivastava establishes this. He was recently prosecuted by Camden Council for renting out his Council property to students and was found guilty of two charges under the Fraud Act. He was fined £10,000 and ordered to pay £6,000 to cover the Councils legal costs.
I hope that this case sends out a clear message to any tenant who thinks it's OK to rip off their landlord by illegally sub-letting their rental property. 'Rent to rent' is simply wrong. Right!
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Guaranteed by who? For how long? This is the problem with 'rent to rent' the Landlord is likely to end up with two dodgy tenants. The lessor and their tenants letting under an AST. It's a potential legal mindfield. The only 'rent to rent' scheme I would opt for is a private sector leasing scheme underwritten by a council or public sector organisation that you know aren't going to go bust.
ReplyDeleteI work my 'rent to rent' in a different way. I use an agent to find a landlord who is willing to rent his property to me in order that I can re-let individual rooms. I then meet the landlord and together we inspect the property to ensure that its up to my (very high) standard. It must be squeaky clean and tidy and unfurnished except for white goods which must be under 5 years old. Gas electrical certs must be current.
ReplyDeleteI then agree with the landlord (or his agent if he really can't be present) to maintain his property to that very high standard. If I don't, I wouldn't be able to rent out the rooms. I agree to decorate all rooms when tenants move out and have carpets / common areas decorated annually. I have a weekly cleaner to clean bathrooms kitchen and common areas and she can be hired by individual people to clean their own room or do washing. A gardener comes in regularly to maintain the garden. On top of that I give a written guarantee to pay the rent for the agreed period of time and the landlord can take out a credit check and rent guarantee on me - his tenant - just in case he feels safer. The Landlord ensures all appliances and the boiler are maintained (and paid for if they go wrong) and I pay for the gas/electrical certs each year. I maintain the inside of the building and he repaints the outside when needed
I rent to young professionals (no dss/students etc)and I pay all bills. They have to pass a strict and full credit check and supply a guarantor. No pets / no smoking / no overnight guests without permission of the other tenants and me.
Its a win win situation. I achieve a good rental income (after initial expense of furnishing the house) and the landlord has a fully maintained property that is appreciating in value. He can inspect at any time - in fact I welcome this.
I prefer to say individual lets rather than sub letting, but it has to be with the full written authority of the landlord. It works very well.
I have a similar procedure. I enter into a management agreement with the owner whereby I take on all responsibility for lettings and management and repairs and pay the owner a fixed monthly amount. Obviously this is less than the monthly rental income, the owner is well aware of that. I act as the owner's agent to grant tenancies, exactly the same as a letting agent does. All entirely legal and above board.
ReplyDeleteAlthough I'm a landlord, I don't have HMO, rent-to-rent, options or whatever new flavour of the month.
ReplyDeleteHowever your comments about 'rent-to-rent' perplexed me. Would you like to clarify why you say that its:
- "immoral from a landlords point of view", and
- "almost certainly illegal"
You make a statement, and give no reason or qualification.
Some reasoning behind your statement would be nice. At the end of the day, your subscribers receive your emails for your editorial opinions, not unfounded statements.
Who ever started this thread has got it all wrong.
ReplyDeleteNothing like how its supposed to be, once again people with very little knowledge trying to tell the rest of property business what they should or should not be doing
Your statement about Rent to rent is not even a rent to rent scheme, its just a council tenant sub letting his property 2 different things. Plus under under his letting agreement he can not sub let, thats why he was taken to court. Get your facts right before making statements and find out about the real people conducting a true rent to rent scheme as per some of replys have stated. Thank you
ReplyDeleteThese people have little respect and dignity for others. This is exploitation of both tenant and Landlord that should be stopped.
ReplyDeleteAs far as I know, this is not legal as there are strict guidelines in theory that a landlord has to implement before a property is let. The person that sublets is surely breaking these rules and should be held liable.
Maybe if the majority of landlords would not charge astronomical prices, rent-to-rent schemes would not be so popular. I am trying to rent a room in Surrey on a very modest wage and would end up paying £ 500 per month for a small double room with very little privacy. This would cost me a third of my wages. A similar offer on a rent-to-rent scheme costs me £360 ! What do you think I am going to do?
ReplyDelete