Worries mount over ‘catastrophic’ plans to allow sub-letting

Concern is continuing to mount over plans buried away in the Budget’s small print which will mean that private landlords can no longer ban sub-letting.

Sub-letting is commonly banned in letting agreements, but such clauses would become illegal.

The Government, which wants to encourage the “sharing economy”, says it intends to introduce legislation.

If this goes ahead, it would mean that landlords cannot legally stop their tenants from letting out rooms, or from advertising their rented homes on sites such as Airbnb or HomeAway at a higher price.

This would allow the tenant to make a profit, while increasing the risk of wear and tear.

It could also concern specialist insurers and buy-to-let lenders, who routinely ban sub-letting.

Allowing tenants to sub-let could also drive a coach and horses through the requirement to conduct immigration checks on prospective tenants, say critics.

There are other implications for landlords in areas of selective licensing, for deposit protection, for homes being turned into Houses in Multiple Occupation without the landlord’s knowledge, and for existing HMOs to breach requirements as to numbers of occupants allowed.

Paul Shamplina, founder of eviction firm Landlord Action, said there are already far too many problems with tenants trying to sub-let for a profit.

He called the new move “catastrophic” for the industry.

He said: “We have never seen so many sub-letting cases going to court because of unscrupulous tenants trying to cream a profit from a property they have rented.

“We experience continual problems with tenants taking out tenancy agreements and then, in some instances, not even moving into the property themselves, but putting up partitions and sub-letting to as many people as possible.

“They draw up separate agreements and trick sub-tenants into thinking they are the landlord.

“By the time landlords find out, damage to properties from over-crowding can run into thousands, and the tenant who holds the legitimate tenancy agreement is nowhere to be found.”

He was also critical that the Government had made the announcement without any consultation with the industry.

He said: “This is not the way to fix the housing shortage, and in fact will have quite the opposite effect if more and more landlords are exposed to the risk of nightmare sub-tenants.

“Giving landlords even less control over their own property by preventing them from instilling clauses which prevent sub-letting could drive more good landlords out of the marketplace.”

This is how Eye reported the story, hidden in the Budget, last week.

 

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8 Comments

  1. Will

    Such a shames that Government is out the loop and looks for any way it can find to reduce the housing crisis due to THEIR LACK OF PROVIDING SOCIAL HOUSING.

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    1. Beano

      Really? Do you not think it might be to do with the fact we (for all intents and purposes) have an open door immigration policy? I work in a rural area and have just got off the phone to the vietnamese landlord regarding the nigerian tenant, and recommended the polish tradesman……

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  2. Caspian VII

    This is beyond ridiculous – absolute madness…….

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  3. Will

    Of course the housing crisis is caused by the open door policy. Government says it increases income for the country but then they fail to provide the extra accommodation and infrastructure needed to deal with it and look for ways of trying to say they have dealt with the housing shortage they have generated. Labour, libs, greens all want rent control to stop the adverse political effects of rising rents due to the demand government has generated. Cons & UKIP seem to want to leave it to market forces. But all want to impose more and more control (which they do not have funding to enforce!). Only one solution will work reduce demand or increase supply.

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  4. Andy W

    Let’s just hope they got their date for April Fools’ Day wrong…

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  5. WPD

    It’ll be interesting in London flats where most leases state that there is a prohibition against sub-letting part of the premises.  When a tenant exercises their statutory right and thereby breaches the terms of the lease. I suspect this idea will be kicked into the long grass

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  6. Will

    The problem is Government have create to problem with its open door policy, particularly in London where the increase in numbers has expanded well beyond the ability to house them all. The Government can’t built to accommodate all of those from eastern Europe in particular so what is their solution to cramming more people in?  You don’t need to to brain of Britain to realise the only way they can fit more people in is by sub letting – its a version of the bedroom tax.  Perhaps landlord should preempt by putting clauses into lease requiring tenants to pay 60% of any increase in rent to the Landlord?  Just an idea. Short of the present Government being removed ( and avoid in those wanting rent control) but there are more people wanting accommodation so Landlord will not outnumber the rest!

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  7. wayneleecarson

    How about the implications of the Immigration Act 2014 and it’s phased roll-out across the UK? I hope that the original tenant is bound by the impositions placed by this act?

    Again another pile of incomprehensible tripe produced by a desperate party that has no idea of how they are truly going to help the Housing Sector! Vote seeking desperation in the run up to an election. I dare say the conservatives will evolve their own tripe as well. Lets just see what happens after the election when the suckers have fell for the cheesy sales pitch!

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