What Is Subletting and Why Do People Do It?
Also known as subleasing, subletting is when a tenant rents their rental home to another tenant, known as a sublessee. This is a great temporary solution for someone who doesn't have a place to live and needs to find short-term housing fast. Keep reading to see whether this option makes sense for you, whether you’re the original tenant or the sublessee.
In short, sublessees typically rent from a tenant who won't be living in their space for a set amount of time. An example would be when college students leave to study abroad. They won't want to pay rent for a place they aren’t living in, so they’ll look for someone who needs a place to live for the amount of time they’ll be gone. That renter, known as the sublessee, then pays rent to the original tenant. As a result, the actual tenant doesn't have to break their lease or pay rent for the space while they’re gone.
You can sublet a single room in your home to make extra money too, instead of the whole rental property. The same idea above applies, but you may have to play the role of a landlord.
Is subletting your rental a good idea?
A sublease can be a smart idea for a few reasons. That said, you may encounter a few drawbacks. Here's a look at some advantages and disadvantages:
- Pro: You won't have to pay rent for a place you're not currently living in, assuming your sublessee is reliable.
- Con: You're still responsible for paying rent if your sublessee doesn't pay you.
- Pro: You won't have to worry about breaking your lease.
- Con: Your sublessee may cause damage to your home, resulting in you having to pay fines when you decide to move out.
It’s essential to screen your potential sublessees before you commit to any arrangements. You don't want to find out they aren’t reliable after the fact.
You'll also want to take precautions for your valuable possessions. Original tenants may leave their furniture behind since the rental will still be theirs when they get back, but always take jewelry, heirlooms and other valuable items with you if possible. It’s important to take the proper steps to protect your valuables.
What are subletting laws?
You must review your state laws and the lease you signed to see whether it’s legal to sublet your rental or not. Landlords and property managers are required to allow anyone the right to sublease in certain states, while other states let them decide instead. If your state laws allow subleasing but your lease doesn’t, inform your landlord or property manager of the state laws. If your lease does allow subletting, thoroughly review the stipulations. You’ll need to make sure you follow the correct protocol. For example, you can't charge more than your current rent if you live in a rent-stabilized apartment unless you provide furniture.
Additionally, even if subletting is allowed in your state and lease, you must let your landlord know you’re interested in exploring this option and get their approval, preferably in writing. If you don’t, you risk both you and your sublessee being kicked out.
Subletting can be a good option
A sublet can be mutually beneficial for both parties. If you want to earn extra money or won't be living in your rental for a while, you can benefit from subleasing. And if you need a temporary place to stay, becoming a sublessee is a great option. Either way, practice caution before you sublease your rental or become a sublessee.