Sub-letting

Subletting a Leasehold: Don't let property safety become an issue

The idea of a lessee or tenant sub-letting their leasehold property has become very popular in the UK. So long as the lease agreement permits it, all or part of a property may be sublet to another tenant and rent collected from that sub-tenant as if the original tenant were the landlord. Of course, the original tenant's lease agreement with their own landlord would remain in place, and they will still have to continue to abide by it -- and that includes paying the rent to their lessor on time. But even so, by choosing to sublet a property the original tenant can dramatically cut the costs associated with that property, as most of the rent will be supplied by the sub-tenant.

Preparing the ground

The first thing you need to do is to establish what you are and are not responsible for in the tenancy agreement that you set up with your sub-tenant, and also with the lessor. In most circumstances the sub-tenant will expect the sublettor to take responsibility for such concerns as gas safety, safety of electrical installations and compliance with furniture and furnishing fire safety regulations…basically all of the issues that you would expect YOUR landlord to take responsibility for if you were to reside in the property as a tenant yourself.

It might take some negotiation to find a middle ground on which all parties are satisfied with their legal obligations. Any changes should be agreed in writing and signed off as legally binding, perhaps as an addendum to any existing lease or sublet agreements that are already in place.

You have to remember that a sublet in the eyes of the law places the person operating the sublet as landlord, and so all of the regulations that apply to landlords will also apply to the sublettor.

Taking responsibility

While it may be possible to rely on your lease agreement with your own landlord to cover some of your legal responsibilities as a sublettor, you should, as a matter of course, perform your own due diligence for your expected landlord duties -- just in case your own landlord has missed something or won't be able to back you up if and when the time comes to it.

As appealing as subletting property might appear to you on the surface though, there are safety issues that you'll need to deal with before embarking on such a journey. You cannot assume that just by subletting your property you are immune to responsibilities that are expected from any owner-landlord  -- just remember that in the eyes of your tenant (and the law) YOU are the landlord… if anything goes wrong it is YOU who they will turn to, and it is YOU who the law will look prosecute.

In some instances the law places special obligations on subletting landlords. One such example is the gas safety regulations. For sublets of less than seven years the subletting landlord has a legal duty to ensure that…

• All gas fittings and flues in the property are safe
• An annual safety check is carried out by a CORGI registered engineer
• Records of each safety check are kept for a minimum 2-year period
• Safety check records are distributed to the existing tenant within 28 days

Additionally, you may need to supply a copy of the annual gas safety certificate and records to your own landlord.

An all-encompassing role

Subletting property can bring with it some complex safety issues for the subletting landlord. What happens if the tenant is injured by an unsafe electrical socket? Who takes responsibility if a loosely fitted carpet results in the tenant tripping over and breaking a leg? As the sublettor is the landlord, it is he/she who will be held to account. In this all-encompassing role the sublettor MUST therefore take all the precautions that any landlord would take…and this includes taking out appropriate insurances as well as performing their own due diligence and safety checks on the property. Yes -- you might be able to shift the responsibility over to your own landlord, but do you really want to take that risk…especially when you consider the possible consequences of being prosecuted?