Allowing A Corporate Sublease Could Be The Answer

• Helps ensure that the landlord will receive the rent payments

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• Maximizes the use of the rented premises and prevents space from being left vacant

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• Subtenants could become reliable prime tenants

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• Can help landlords who are struggling financially, like during an economic downturn

• Helps ensure that the landlord will receive the rent payments

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• Maximizes the use of the rented premises and prevents space from being left vacant

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• Subtenants could become reliable prime tenants

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• Can help landlords who are struggling financially, like during an economic downturn

• Pro: You don’t have to hunt for a new tenant
  Perhaps a job change, military demand or family situation has prompted your tenant’s request to sublet. Maybe they don’t want to give up their apartment completely, or they don’t want to face the penalties that would come with breaking their lease, but they are unable to stay in the place for the time being. It’s a win-win situation if your tenant has already found someone to take over their lease, but proceed with caution…

• Pro: Your property continues to generate revenue
  “There are temporary subleases and permanent lease assignments. A temporary sublease involves the tenant vacating for a short period and having someone else pay to stay there,” says Davis. The tenant will return to the property before the end of the lease. “Permanent lease assignments occur when a tenant wants to move out early, and wants someone else to take over their lease,” says Davis. In either event, someone will be paying rent, so your property won’t just be sitting vacant.

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• A landlord may choose to allow subletting because it will keep their rental property occupied and rental income steady, they will maintain a positive relationship with their tenant, it will minimize the chances of a tenant skipping out on a lease, and they will avoid expensive turnover costs.

• Landlords allowing rental arbitrage can benefit from a lower overall property vacancy since the tenant will likely continue renewing their lease if the property generates income. A landlord could earn more money by allowing this strategy by charging a premium rental rate to a tenant for rental arbitrage or receiving a percentage of the profits.

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• Like any other type of rental business, there is no guarantee that rental arbitrage will be profitable for the investor. It can be a great side hustle or even a main business, but it takes work to determine the best way to rent a property and manage it as a short-term rental listing.