As a rental property owner in Orlando, deciding whether or not to let your tenant sublet your rental property can be a challenging decision. Allowing your tenant to sublet can lead to a lack of control and pose multiple risks, so how do you navigate this situation?
It is essential to weigh all of the factors of letting your tenant sublet. As an experienced Orlando property manager, here is everything you need to know about letting your tenant sublet your Orlando rental property.
What is Subletting
Subletting, also known as subleasing, occurs when a tenant rents their leased room or property to another tenant for a period of time or for the remainder of the lease term. The lease agreement between the original renter (sublessor), and the landlord still remains. There is technically no legal lease agreement between the new tenant (sublessee) and the landlord.
Subleasing should not be confused with lease termination — during a sublease the original tenant is still responsible for the property and held accountable for rent payments, property condition, and adherence to the lease agreement. In other words, the original tenant is expected to uphold all aspects of the lease agreement. If they don’t, any penalty can be held against the original tenant.
Why Would a Tenant Want to Sublet?
There are various reasons why a tenant would want to sublet. Subleasing is common when a tenant wants to move out prior to the end of the lease term. Instead of vacating early and having to continue to pay the difference in rent, some tenants opt to sublease their room or the full property.
Whether it be because of job relocation, financial difficulties, or a desire to upgrade or downgrade, tenants typically see subleasing as an opportunity to fulfill their lease obligations.
Subletting Laws in Florida
Subletting is legal in Florida and ultimately depends on the individual lease agreement and landlord’s preferences. The landlord has the right to decide whether or not tenants are allowed to sublease and the terms in which they can do so.
To ensure your policy is clear on subletting, your terms should be thoroughly outlined in the lease agreement. To allow or prohibit tenants from subletting your property, the following should be included:
Subletting Permission
- The tenant shall not sublet the property, or any part thereof, without written consent of the landlord.
Procedure for Subletting (if permitted)
- Procedure for consent: If the tenant wishes to sublet, a written request must be submitted to the landlord.
- Information Required: The written request must include essential information such as the name and contact information of the potential sublessee, and any information requested by the landlord.
- Landlord’s Discretion: The landlord reserves the right to approve or deny any subletting request at their sole discretion.
Consequences of Unauthorized Subletting
- Null and Void: Any subletting or assignment without the landlord’s consent and approval will be null and void.
- Grounds for Termination: Unauthorized subletting or assignment will constitute a breach of this agreement and shall be grounds for immediate termination of the lease.
If you do not clearly state your subletting policies in the lease agreement, there is no way of holding your tenant accountable for the process or consequences.
Risks of Subletting
As an experienced Orlando property manager, I advise you to NOT let your tenant sublet your rental property. Allowing your tenant to sublet comes with high risk and low reward. Here are some of the risks of allowing your tenant to sublet your rental property:
Lack of Control Over New Tenants
One of the most essential aspects of owning and managing a successful rental property is having control over the tenants you allow to rent your property. With subletting, you often have a lack of control over the new occupant. While you can enforce a strict tenant screening process for your original tenant, the tenant may not be a qualified tenant with financial stability or positive rental history.
Lease Violations
Because the responsibility of upholding the lease still technically falls under the original tenant, there is no guarantee that the sublessee will adhere to the lease agreement terms. Allowing your tenant to sublet can lead to a variety of lease violations such as unauthorized pets or occupants, late or failed rental payments, damage to the property, or noise complaints.
Financial Risks and Property Damage
An unscreened new occupant puts your property and your income at risk. If your sublessee fails to pay rent, the chances of your original tenant upholding the lease agreement and proceeding to pay are very slim.
In addition, although many rental property owners have a maintenance reserve account, unreliable tenants who cause damage to the property can result in an excess amount of money spent on maintenance and repairs.
Risk of Eviction Complications
In Orlando, dealing with a sublessee during lease violations that warrant a lease termination can be more complicated than usual. Depending on the situation and the individual lease agreement, the sublessee may not have a written agreement with the landlord. Therefore, the original tenant on the lease arrangement would typically be the target of eviction proceedings. The original tenant would be held accountable for any lease violations, making the process of evicting the sublessee a challenge. If you find yourself in this situation, I highly recommend hiring a professional attorney to proceed with the eviction to ensure the legality of the process.
Eviction complications can be extensive and expensive. When dealing with an eviction you will lose out on rental income until the eviction is completed and a new tenant is secured. In addition, you will have to pay attorney fees and background check fees for potential new tenants.
Should I Let My Tenant Sublet My Rental Property- Property Manager Insight
As professional Orlando rental property managers, we often advise our clients NOT to let their tenant sublet the property. The risks associated with subletting, including lack of control over new occupants, potential lease violations and property damage, financial risks, and risk of eviction complications, outweigh any potential benefits.
As a rental property owner managing your property on your own, sometimes it can be difficult to make decisions like whether or not to let your tenant sublet. My best piece of advice is this: if you feel any decision leads you to a lack of control over your property, it is not the right decision.
When you work with us at The Listing Real Estate Management, you don’t have to make these decisions on your own. Our expert property managers will not only guide you to the right decision, but also educate you on why we believe our policies and operations are the most beneficial for your property.
If you are looking for guidance and prosperity in your property management journey, contact us today at The Listing Real Estate Management. We have played a pivotal role in helping hundreds of Orlando rental property owners gain wealth and optimize their financial returns.
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