What does subletting mean? A question many tenants ask themselves when checking out the rental agreement.
Subletting in Australia is growing popular, propelled mainly by soaring rental rates and the rising cost of living. The rise in rental costs is being felt most in the capital cities of Australia. In these urban areas, rental rates were estimated to have soared by as much as 21.2%.
So, shall we define subletting? Simply put, subletting happens when a tenant tied to a residential tenancy agreement leases part of the rental property to another person. A sublet needs the landlord’s written consent.
It is not subletting, however, for tenants who have a visitor or guest stay in their rental. This is provided that such accommodation is not for commercial purposes.
Taking over from a tenant who’s leaving can be considered subletting. A short-term stay, such as an Airbnb accommodation is also a subletting arrangement.
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Gains for tenants
For tenants, a mastery of what does sublet mean can be advantageous. It’s a great way for them to reduce their rent expenses.
Subletting offers significant potential gain, bringing much thought to what does sublet an apartment mean. This is considering that out of the 8.3 million households in Australia 32% or 2.6 million households) rent their homes. Many tenants can also benefit from the rise in home-sharing seen in the proliferation of tourist-oriented Airbnb.
Landlord’s concerns
Landlords, on the other hand, have to be watchful about what does sublet mean to their property. Subletting, which is also called subleasing, involves the landlords’ rights over protecting their investment in the rental. They have rights on how it’s maintained and who lives in it.
But landlords also have to accept, regardless of their feelings about what does sublet an apartment mean, subletting is legal. In Australia, this legality is provided under the provisions of the Residential Tenancies Act.
What does a sublet apartment mean?
Generally, this Act entitles every tenant to sublet, with some exceptions (more on these later). In subletting, as mentioned earlier, tenants in an apartment or house rent a room in their rented unit to another person.
The subletting tenants hence become the head tenant and their renters the sub-tenant. As head tenants, they must assume the legal responsibilities of a landlord over their sub-tenants.
The head tenants’ role calls for them to be onboard on questions like— what does sublet mean on an invoice? Being head tenants, they are responsible for collecting the rent from sub-tenants, issuing their rent receipts, and depositing bonds.
Sublet = second tenancy agreement
It is important for landlords to understand that a second tenancy agreement is created if their tenant sublets. With this second tenancy contract, landlords should take note that their rules on eviction and other rental matters must be followed. It is these head tenants, however, who will enforce the original tenancy agreement, such as the eviction of erring sub-tenants.
In short, subletting tenants remain fully accountable to the landlord for their tenancy agreement. A landlord can claim from the head tenants for any property damage the sub-tenants commit. The head tenants, in turn, can go after the sub-tenants for any damage claim.
All information on the sublet should be spelled out on the second tenancy agreement. The landlord, the head tenant, and the sub-tenant should sign this sub-lease document.
Rules on subletting
Rental properties in registered community organisations are not open to subletting. Their landlords, therefore, aren’t concerned much about issues on what does sublet an apartment mean. They can simply refuse subletting permission for those in public housing as it would be unfair to others waiting for more affordable public housing.
Subletting in other Australian rental properties require the written consent of their landlords. The tenants who want to sublet their rental unit are bound to follow these steps:
- Send a letter to the landlord seeking consent to sublet
- Submit to the landlord a draft of the subletting agreement with the name, proof of income, and references of the sub-tenant applicant
- Ask the landlord to sign the agreement and send back the signed document
Tenants liable for unauthorised subleasing
If a sublease goes without the written consent of the landlord, the tenant will be held responsible for it. Landlords who discovered a subletting without their written consent have 21 days to end the lease and sublet agreement.
A landlord can terminate this agreement, as a tenant who sublets without landlord consent violates regulations under the following:
- Standard Residential Tenancy Terms
- Residential Tenancies Act 1997
A landlord will have to apply for sublease termination to the ACT Civil and Administrative Tribunal. This agency is empowered to order a termination and possession of a residential tenancy agreement in case a tenant subleases the rental without the written consent of the landlord.
Landlords’ basis to deny sublet consent
Tenants can appeal to authorities if they believe their landlord unreasonably withheld their consent. Landlords may reasonably withhold their permission for their tenants to sublet based on the following grounds:
- The number of proposed occupants exceeds the tenancy agreement or zoning regulations.
- The proposed sub-tenant applicant is blacklisted on a tenant database.
- The landlord reasonably sees overcrowding on the rental premises will become overcrowded.
Landlords and other rental providers cannot refuse consent to sublet because of the concerned person’s ethnicity, disability, or gender identity. The Equal Opportunity Act 2010 outlining protected personal attributes also poses limits on sublet permission refusal.
They also cannot charge a fee for giving their consent to sublease. Tenants can appeal to government tribunals if they believe that their landlord denied their sublet application letter unreasonably. These agencies, in turn, can decide if the tenants’ subletting should be allowed.
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