Air BnB is considered by many, an innovative business model that revolutionised the hospitality industry. Hotels and B&Bs globally have changed their paradigm. They have to compete with an international booming industry led by the average home owner or dweller. Yes, the average home owner can grab a money making opportunity with a spare room. In fact, the idea of turning a spare room into a B&B isn’t new. What makes it innovative is the internet. More importantly, a high tech app accessed by anyone with a smart phone anywhere in the world. But the problem with Air B&B hosts is that sometimes they are tenants and not landlords. They’re effectively tenants without ‘Air tight’ clauses in their landlord agreements.
Tenants can sublet if the tenancy agreement contains a relaxed subletting clause. To avoid serious problems, landlords should keep subletting clauses ‘Air tight’. Never should a subletting clause be relaxed. Remember that in the UK, people can literally travel or even live by hopping about from one Air BnB room to another. As long as you book your nights and pay your rent via the Air BnB app. The host may be the home owner but may also be a tenant. Some tenants do have the landlord’s permission to rent out a spare room but allowing a tenant to sublet would absolutely require a subletting clause in the tenancy agreement.
It’s surprising how many times property lawyers see new tenants requesting amendments in landlord agreements. With Air BnB as an easy way to make some extra income, a tenant would likely use the extra room to sublet it and generate enough income to pay rent. If you are a landlord that is prepared to allow your tenant to sublet to a complete stranger, then you need to be advised on the pros and cons of a relaxed subletting clause. If however, you choose not to run that risk, the subletting clause needs to be very clear and specific. Your tenant needs to understand that under no circumstances should the property be leased to anyone else.
Air BnB do not carry out proper checks to ascertain their hosts own their homes. They are actually not under that kind of obligation. But landlords and tenants have responsibilities relating to the property. Landlords have to ensure proper checks are carried out on all tenants in a house in multiple occupancy. Some landlords actually use Air BnB as a way to generate income by allowing people to stay for great lengths of time. Air BnB cannot carry out immigration checks. That is the responsibility of a landlord. Our advice to you as a landlord – don’t do it. If you’re a tenant, our advice to you – don’t sublet without your landlord’s permission.
If you are a landlord, before you agree to relaxed subletting clauses, please get our advice. We will help you understand the potential risks of tenancy agreements with relaxed subletting clauses. SG
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