Rent to Rent / Guaranteed Rent

Rent to Rent, sometimes referred to as Guaranteed Rent, is an arrangement where an individual or company leases a property from a landlord and agrees to pay a fixed rent for a set period. With the landlord’s consent, the “Renter” sublets the property to other tenants, becoming responsible for managing the property, looking for suitable tenants and collecting rent payments.

Types of Rent to Rent

A few models that typically involve Rent to Rent:

• Commercial or corporate tenancies
• Management agreements
• Leases/ Guaranteed Rent schemes

Benefits of Rent to Rent for the landlord

Some landlords prefer Rent to Rent arrangements over traditional letting agents, some reasons include:

• Guaranteed Income: Landlords receive a fixed rental income regardless of whether the property is occupied or if tenants fail to pay rent.
• Maintenance and Repairs: The Renter is responsible for returning the property in its original condition, covering any damages and providing peace of mind for the landlord.
• No Letting Fees: Landlords avoid letting, management, or renewal fees, saving time and money.
• Compliance Handling: The Renter manages legal and compliance issues typically handled by a letting agent.
• Long-Term Security: Landlords can secure longer-term contracts, ranging from 1 to 5 years, allowing for better long-term budgeting.

Benefits for the Renter

For the Renter, taking on a lease of the property offers several advantages:

• Profit Retention: The Renter becomes the effective landlord and can keep the rent paid by the tenants.
• Flexible Arrangements: The Renter can implement flexible leasing options, such as renting out individual rooms in a shared property.
• Fewer upfront costs: Instead of the large costs involved in purchasing a property, the Renter just pays any agreed upon costs and rent.