Subletting, or a sublease, allows a secondary tenant to move into a property for either a short period of time or for the remainder of the lease agreement. Depending on the sublease, your tenant may be completely responsible for any issues that occur with the secondary tenant. However, just because you may not be responsible for damages or complications doesn’t always mean that allowing tenants to sublease is a great idea. To help you make a more informed decision, this article will review whether or not property owners should allow their tenants to sublease.
The Pros and Cons of Subleasing
For landlords, the best aspect of allowing tenants to sublease is the lack of vacancy. If a tenant moves out before the lease is up or has to leave for a short period of time, you won’t lose any income, and you can be sure that someone will be there to maintain the property. Additionally, if included in the lease agreement, you don’t have to do any of the work in finding the secondary tenant or being responsible for their damages.
However, there are disadvantages to subleasing. You may not know the sublease your primary tenant chose. To avoid this, you either must screen the tenant using a background service, adding work to your plate, or get to know the secondary tenant personally. If not, you may be leaving your property in the hands of an unreliable tenant, making it vulnerable to property damage.
Should You Allow Your Tenants To Sublease?
In truth, the answer is that it depends. In general, one of the key items to include in a lease agreement is whether or not you allow subletting. If you do allow tenants to sublet, and you have an airtight subletting clause in your lease agreement, then you can rest easy. However, like with any tenant, you’ll always run the risk of your property being in the hands of an untrustworthy person. If you feel like this risk isn’t worth the income gap, then this option isn’t for you.
What To Include in Your Lease Agreement
If you let your tenants sublease, there are a few things you should include in the lease agreement to ensure your peace of mind. For starters, your tenants should always get your written permission before allowing a secondary tenant. You must approve the tenant. Additionally, it’s a smart move to require the secondary tenant to have renter’s insurance to avoid any damage or injury liability issues. Lastly, to avoid issues with rent collection and to make sure your tenant isn’t charging higher rent to pocket the difference, have the subtenant pay rent to you directly.
Hopefully, this article has helped you answer whether or not you, as a property owner, should allow subleasing. Ultimately, it is up to what you are comfortable with and whether you have the tools and the knowledge to protect yourself and your property.
