As a landlord you may at some time receive a request from your tenant to sub-let all or part of your property to another person. Understandably you may worry about what this means for you and your property. Subleasing is not uncommon, and by becoming familiar with both your rights and obligations as a landlord you will be able to navigate such requests with minimal stress.
Subleasing is where the tenant enters into a formal agreement with somebody else to rent part of the premises (e.g. the garage or granny flat) or the whole premises to them.
Your tenant would, in effect, be taking on the role of landlord for the sub–tenant. There is no contractual obligation between you and the sub-tenant, who will pay their rent directly to your tenant. Your tenant will still be liable for any unpaid rent or damage to your property even if it is incurred by the sub-tenant.
The tenant does need your written consent to enter into a subletting arrangement but you are only able to withhold consent if the request is not reasonable. Legitimate reasons for saying no are:
There may be other legitimate reasons for refusing a request for which you need to notify your tenant in writing. If the tenant wishes to challenge this they are able to do so by taking their request to the NSW Civil and Administrative Tribunal.
It’s important to note that if a tenant wants to have an additional occupant living with them they do not need to tell you who they are or get your consent as long as they do not exceed the maximum number of occupants stated on the tenancy agreement.
The NSW Department of Fair Trading has more information.