Firstly before choosing to take on sharers within your property, it is wise to ascertain whether you will require a HMO licence. Whether your property is let to multiple tenants on a room by room basis, or as a collective you may still require a licence. There are two types of licence, a mandatory HMO licence for any property which has three stories or more, and have five or more people sharing facilities. This is a requirement that is regulated under the Housing Act and ensures certain standards of both the property, and the landlord.
Selective HMO licences are discretionary and cover HMO’s which don’t fall into the category described above. These have been introduced by local authorities to ensure certain safety standards and security for tenants. Therefore even if your property does not meet the requirement for mandatory licencing, check with your local authority about the regulations within your area.
What happens if one sharer pulls out
As all tenants have signed one assured shorthold tenancy agreement, they are jointly and severally liable for the rent or finding a replacement tenant. Student Haus can assist in the administration of this.
What happens with deposits when renting to sharers?
Your tenant’s deposit must be protected by law. While different tenant deposit schemes work slightly differently, one staple of advice remains the same. Best practice is to draw up a new tenancy agreement, and the portion of the deposit is taken from the new tenant, with the proportion given back to the outgoing tenant. Here at Student Haus, we protect tenants deposit in the Deposit Protection Scheme (DPS), who always advise to draw up a new agreement.
So Should I rent to Sharers?
While there can be little more work involved in letting your property to sharers, the benefits of reduced void loss, combined with potentially higher rental yields is a good enough incentive for many landlords to consider sharers. Using an expert management agency like Student Haus will ensure that the process of letting to sharers is just as easy as a single let. Find out more about how we help landlords to let to student sharers.