Guaranteed rent
Guaranteed rent usually refers to an arrangement where you let your property to an intermediate company or agent, who promises to pay you a fixed rent each month for a set period, whether or not the property is actually occupied or the subtenants pay their rent. You become their landlord, they then let to occupiers and keep any surplus as profit.
From a landlord’s perspective, guaranteed rent can look attractive:
Predictable income and reduced void period risk.
Little or no day-to-day contact with tenants.
The “guaranteed rent” operator deals with repairs up to an agreed level.
However, it also brings risks. The contract is usually a company let or commercial style lease, not an assured tenancy, and if the operator stops paying you may need to forfeit or end that lease before you can regain control. Meanwhile, the occupiers are likely to have full private renting rights under the Renters’ Rights Act, and regulators may still treat you as part of the landlord chain for licensing, standards and unlawful eviction issues.
Professional landlords treat guaranteed rent as a specialist rent-to-rent model. They check the operator’s finances and track record, get robust legal advice on the headlease, and monitor compliance so the property is not misused or run in breach of housing law.
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