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  • Rent-to-Rent

    Need advice as a sub-letter

    Hi , I signed a AST with the landlord for 6 months from 20th August 2018-feb2019 which is going to end on 20th Feb 2019 but with a view that if landlord is happy with me then landlord will sign a new AST for 6 months more after 20th feb 2019.

    Landlord knew the fact that I will sub-let his house and estate agent will manage his house (through Whatsapp messages)  but AST does not mentioned this. The landlord lives next door he owns both houses.

    I used estate agent to let this property for a year contract and till May 2019 and pretend to estate agent that I am the landlord of this property, and tenants or agent do not need to disturb the landlord or about how much profit i am getting from agent. I was getting £150 per month profit.

    Now after 5 month , landlord is not willing to go for 6 months more with me so I informed the estate agent true picture that I am not the landlord but the next door neighbor is the landlord. and I told the landlord that for month 6th (last month) considers my deposit as my last rent.

    Is there any fraud representation from my side? is there any criminal offence? if i did any wrong whats next?

    But landlord got his all rent on time and I got all my rent from estate agent .

    ?

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    Does LL now know you have been subletting without his express permission?

    He surely must have known since outset as he lives next door?

    I imagine that is why he is not renewing the AST!

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    Yes landlord knew the fact that property is managed by estate agent through me. but estate agent knew the fact in month 6th (last month of my AST) that I am not owner. I told estate agent this fact.

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    Hi Shahzad,

    It was fraudulent for you to lie about the ownership of the property to the agent, but having said that, the agent should have performed background checks on you, so they are as much to blame.  There is little that anyone could do about this.

    You have not committed an offence per se but you should not expect the deposit to be used for the last month's rent.  The deposit is to cover any wear and tear or damage, so you should pay the last month's rent and then reclaim the deposit after the tenancy has ended.

    What will happen to the tenants you put into the property?!

    While, from what you have said, there is no financial loss to anyone in what happened, you did use deception, and that is never a way to build a sustainable business and you run the risk of it coming back to bite at some point.

    Hopefully this has been a learning experience for you and you will breathe a sigh of relief that you got away with it  You may not be so lucky if you attempt this again.

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    Yes , no financial loss of either side. LL got the rent on time I got the rent from estate agent on time. Yes for last rent that I can considers to pay now and reclaim my deposit at the end . But at last no criminal offence .

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    So now you have to tell subtenants that they have 1 calendar month to vacate property - and they in turn may elect to withhold final month's rent albeit that is not legal. Did they pay any deposit?

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    Knowing is not the same as consent. It's not a criminal matter but a breach of contract. What is his loss? Probably some additional wear and tear for which may hit your deposit. Only other risk is he has suffered a penalty (no HMO license?) or his (new) mortgage company (not an AST) have caused issues. I cannot see this going anywhere but you will have to move out I would have thought.

    The landlord may of course be seeking to replicate your model - particularly if he lives next door. Its an easy £150 pcm for him. Does he know you have to give notice to the tenants? Do a deal with him?

    And of course living next door he may not like the noise, etc. I suggest a civil conversation with him.


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    Chartered Accountant, Tax Advisor and Mortgage broker

    (and BTL portfolio owner)

    stuart@johnsonsca.com

    02039077022


    Yes you are right, even though if he heard small bang in his next door house he always called me to find out whats going on in his property. He never took a courage to knock at his next door house and asked them or tell them that I am your neighbor so what you doing or everythings ok? That is the only reason I thought about to end this model of business. I never ever do this model to anyone again. I am starting my own estate agent LTD company.

    Do I need a license to start an estate agent business. or need a website, company registration and physical address for estate agent LTD company.

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    You need advice. Those latest questions are fairly basic and fundamental. Call ARLA for advice,

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    Chartered Accountant, Tax Advisor and Mortgage broker

    (and BTL portfolio owner)

    stuart@johnsonsca.com

    02039077022