One of the most costly aspects of property management is finding good tenants. Anything with the potential to help you maintain full occupancy is a good thing — right? Well it depends. While a useful tool for vacancy prevention, there are some definite pros and cons of permitting subletting.

Subletting, or subleasing is the process of allowing a tenant to rent to another individual in their stead, while remaining primarily responsible to you for the lease agreement. You get a paying tenant with little or no effort; the tenant gets to keep the rental. While this sounds good, you can probably also see where there might be some issues.

Before we get to those however, let’s examine the up-side.

 

A Larger Potential Tenant Pool

Permitting subletting broadens your prospective pool of tenants considerably. People whose jobs require them to be away for extended periods are more likely to lease your property if they can sublet during the times when they must travel. College students who like to go home for the summer tend to favor this option as well.

Reduced Vacancy Rates

If a tenant is forced to leave temporarily, but can supply you with someone to rent the property while they are away, you’ll experience no vacancy as a result of the tenant’s departure.

 

More Security For Your Property

When your tenant is away, there will still be someone living in the place. Would-be burglars tend to take note of homes that sit vacant for a while and target them for walk-throughs. With someone living there, going and coming, turning lights on and off, gathering the mail and parking in the driveway, burglars are more likely to leave your property alone and look for an easier target.


Related: Six minor things that drastically improve the renter experience.



With that said, here are the downsides of permitting subletting:

Control Is Surrendered

Unless your lease contract specifically states it, your tenant effectively becomes the landlord to the person to whom they sublet. This means you’ll give up some of the control you have over that individual, even though they are residing in your property. If you choose to permit subletting, make sure your lease agreement maintains your right to govern regardless of the occupant.

 

Tenant Profiteering

Unless specifically prohibited by your lease agreement, you might find your tenant is subletting at a profit. Some landlords have no problem with this. If you’re one of them, more power to you. However, that’s money that could be going into maintaining your building, paying down your debts and just generally making your enterprise more profitable.

 

Difficult Personality/Legal Issues

When you met your tenant, you got a good feeling from them and when you vetted them you were reassured of their responsible nature. Generally speaking, most responsible people have responsible friends, but this isn’t always the case. If you wind up in a situation in which the person subletting is wreaking havoc among your other tenants, you’ll have to take action. Problem is, you could have to go through your tenant to do so. And, if legal action is required, you’ll have an additional layer of complexity to navigate.

These are just a few of the scenarios you’ll need to consider among the pros and cons of permitting subletting. Ultimately, your decision will depend upon your particular circumstance. But if you choose to allow it, make doubly sure all of your rights are maintained.

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