6 reasons why your tenant may sublet in 2023…and how to spot it

Would you know if your tenant presented a subletting risk? Are you confident you’d know how to spot if subletting was taking place? With recent research by Direct Line showing 1 in 8 tenants had engaged in subletting activity – and with 22% of tenants considering or already signed up to Airbnb or similar – subletting is something to take seriously in 2023.

Current circumstantial factors, including rising rents, high inflation, an ever-increasing interest rate and a lack of rental properties, all make subletting a viable option for tenants and many are unaware it will breach their tenancy agreement. Here are six reasons why your tenants may consider subletting this year:

1. They can’t afford the rent on their own

The latest HomeLet rental Index showed rents in every single UK region rose in July, meaning tenants are paying 10.3% more to rent a property now than at the same time last year. Instead of moving to a new property and potentially paying more a month, tenants are staying put for longer and may sublet to help cover the cost.

2. They can’t afford to cover their bills

Increasing rental costs come at a time of high inflation and a surge in the price of utilities. Subletting an unused room means there’s another person to help cover the gas, electricity and council tax bills. Tenants may also turn to subletting when their own personal debt becomes unmanageable, with any surplus rental income from a third-party used to pay off credit cards and loans that have been subject to interest rate rises.

3. They regularly stay away from home

Tenants who travel on a frequent basis for work or pleasure may feel their property is underused. As a result, they could consider a short-term sublet as a better use of space, reducing the security risk of an empty property and generating some extra income at the same time. There is a grey area, however, when it comes to pet and plant sitting. This can be exploited by some tenants who can use creative payments and advertising to circumnavigate subletting clauses.

4. They want a side hustle

The term ‘side hustle’ has slipped into our modern lexicon, with people keen to earn a few extra pennies in their spare time. While some participate in online surveys, conduct mystery shops or sell unwanted clothes on Vinted, others sublet. The ease of which income from subletting can be generated is perpetuated on social media, with dreamy videos and the promise of thousands of pounds tempting tenants to take in guests.

5. They have a friend in need of accommodation

As the HomeLet figures illustrate, the cost of renting a property is at an all-time high. This is driven by a lack of available properties to rent and these two aspects are conspiring to leave a band of frustrated – and often homeless – people. It’s only natural to offer a friend a room – or even a sofa – if they’ve been unable to secure a property, charging them a small amount of rent in return. This is, however, another form of subletting, no matter how compassionate it sounds.

They start a new relationship

It’s common for a tenant to sign the agreement as a single person but leave in a relationship. Congratulations are due but there can be an issue if they choose to move their new partner in without notifying the landlord. The referencing process is there to ensure the renter living in the property is trustworthy – anyone who moves in during the tenancy term will not be subject to the same rigorous validation checks.

Our trained professional eye will look for the obvious and more subtle signs of subletting, which can include:

• A tenant making it difficult for a landlord or agent to arrange an inspection
• Complaints from neighbours or the council regarding anti-social behaviour or suspicious activity
• A property being advertised online without the landlord’s permission
• Extra clothing or bedding in the property, especially if it’s in the living room
• More waste/recycling being created than expected for the number of named occupants
• Signs of increased wear and tear in the property
• Post where the name does not match with the person listed on the tenancy agreement
• Locks on bedroom doors
• The landlord or letting agent being contacted by someone not named on the tenancy agreement
• A frequent stream of visitors, some who may have a suitcase or large backpack
• Rooms that have been crudely divided by makeshift partitions and sheets

Our service also includes the following to reduce the risk of subletting:

• Thorough tenant referencing to ensure the renter doesn’t have a past history of subletting
• Affordability checks to ensure prospective tenants can pay the rent
• A clause in the tenancy agreement clearly banning any forms of subletting
• Periodic property inspections to detect subletting

Our team is on hand to guide landlords during the tenant search and property management stages. Get in touch if you have any concerns about subletting or tenant behaviour.