[dropcap]O[/dropcap]ne of the reasons many landlords take steps designed for the facilitation of curb appeal is to attract tenants who aren’t going to compromise their property. After you’ve spent thousands upgrading property value, the last thing you want is for some tenant on the property you were refining to sublet it out from under you.
As it turns out, there is a very real danger here. Especially in times of economic hardship, people who rent rather than owning begin to multiply. When you’ve got any large group of people, you’re going to run into some bad eggs. There’s just no way around it.
The thing about a bad egg is, you don’t always know it’s bad until you’ve cooked an omelet with it; and then your omelet’s garbage. But there are ways to tell. Seasoned cooks never pick bad eggs, because they know their business. In the same way, you can avoid getting undermined by bad tenants. Following are three subletting woes many landlords who are new to the game fail to consider.
1: Tenant Legal Status
According to California Tenant Law, a tenant is allowed to remain on property they were renting until a court legally terminates their tenancy. The only way around this is either the expiration of the lease your tenant signed, thirty-day notice of eviction, or an eviction of the legal category for term violation.
There will be different variations of tenant rights and responsibilities for different states. As a landlord, you must be aware of them. Just as a tenant is required to abide by the terms of your lease, you are required to; and in addition, you’ve got to abide by state law.
Thankfully, there are many landlords and tenants out there who are entirely unaware of such laws, and as long as that lack of informed status remains, so does some flexibility. However, where one party is breaking the law, should that come to light, it will result in legal consequences. So the best strategy is to know the local law pertaining to tenant’s rights.
If you’re not careful, you could end up in a situation like Erlich Bachman of Mike Judge’s Silicon Valley. In the show, he is subletting to a foreign exchange student. When he attempts to evict the student, that student realizes that court proceedings can take up to a year to even begin, after which case, as mentioned earlier, there’s a thirty-day period before a tenant must leave.
If you’re going to sublet, be very careful to whom you sublet, or you could find yourself stuck as landlord Bachman was in the clip.
2: Tenant Subletting
Tenants today often sublet Airbnb, which is why organizations like SubAlert.com exist; according to their site: “At SubletAlert.com, we monitor Airbnb daily. If we find a tenant illegally subletting one of your properties, we’ll quickly notify you by e-mail.”
A tenant subletting to another tenant is likely subletting to a very underhanded individual. Certainly, some tenants only sublet on a one or a two-night basis; but you can bet anybody willing to pursue such an option isn’t the kind of individual who has others.
For the safety of your tenants and your property, it’s in your best interests to prevent subletting, and to evict tenants who you suspect of undermining your property in this way.
3: If Your Lease Doesn’t Restrict Subletting, It’s Legal
Perhaps the most trying aspect of subletting is that if you haven’t expressly prohibited it in the terms of the lease you have your tenants sign, it is perfectly legal for them to sublet. Again, you can try to take them to court, but depending on where you’re located, that could take up to a year, during which time they’ll keep doing what they do.
Successful Property Management
You can’t get into property management lightly. You need to do your homework, and choose tenants carefully. However, provided you take your time in tenant acquisition, design a lease which covers all the bases, and know the rights of yourself as a landlord as well as your tenants, you will likely be able to avoid getting undermined via subletting.
