What social landlords need to do to combat Airbnb subletters

You have the same situation – will you get the same result?

The facts of the case and the specific wording of the tenancy/ lease entered into with your residents will be key to determining whether your resident is in breach of their agreement with you and second what action, if any, you can take.

Well-drafted tenancy agreements usually provide a clear prohibition on subletting the whole of the property. Secure and assured tenants who sublet in breach of their tenancy and cease to occupy the property as their own or principal home will lose their security of tenure.

Landlords may therefore seek to terminate their tenancy by service of a notice to quit (and a notice seeking possession without prejudice to any other notice) before commencing possession proceedings.

“Social housing is a limited commodity and problems arising from Airbnb-style letting can have an extremely negative impact on the cohesion of the community”

In addition, the Prevention of Social Housing Fraud Act 2013 makes it a criminal offence for social housing tenants to sublet their properties if they are no longer using the property as their only or principle home. If the fraud is proven, the court can order the tenant to pay back any unlawful profit made from the subletting.

With long leases, the content of subletting clauses varies widely as some clauses are more restrictive than others and must be reviewed carefully to see if there has been a breach.

In a number of recent tribunal and court cases, it has been decided that short-term lettings via Airbnb breach the covenant for private residential use, which is a usual clause in a long lease, even in circumstances where there has been no breach of the subletting clause.

This makes long leaseholders vulnerable to a claim in damages and action for forfeiture of their lease.

With both tenancies and leases, care should be taken to review the whole of the agreement to see if any other clauses have been breached. For example, noise nuisance caused by the Airbnb guests may also be a breach of the nuisance clause and, if necessary, an injunction could be sought to prevent further disturbance to other residents.

In terms of gathering the required evidence, a collaborative approach is usually the most effective approach to tackling subletting and social housing fraud. Local authorities will have access to databases and often have complex fraud detection software (as was used by Westminster City Council).

It is vital to obtain strong evidence of any subletting before you consider taking any action against your tenant. Social landlords, at the very least, should look to obtain:

• A credit report
• Witness statements from neighbouring residents
• A copy of any advertisements found on hosting websites
• A copy of the electoral role
• Any other information that the local authority may be able to provide

If you are investigating breach of the subletting clause for long leaseholders, care should be taken not to take any action which could waive your right to forfeit, as this is a once-and-for-all breach.

The number of properties being advertised on hosting sites is rising exponentially. Social housing is a limited commodity and problems arising from Airbnb-style letting can have an extremely negative impact on the cohesion of the community.

Social landlords need to take a robust approach in line with their policies to tackle such subletting.

Mary Walsh, senior associate and Liam Hale, associate, property litigation team, Winckworth Sherwood