How do I manage tenancy for 3 singles in a family house?

illusio

I've had an enquiry from someone who wants to rent with his 2 friends, all of whom are in full time jobs. The house is a 4 bed family home, not separate rooms/bedsits, and I'm not sure how best to go about it? Do they need separate tenancy agreements or can I ask one of them to rent the house and make a single monthly payment, and then they sort the details between them?

I don't want a scenario where one of three tenants isn't paying their rent and so I'm having to get rid of one/the remaining two can stay paying only two thirds. And I don't want to have to change the house into separate areas.

All advice welcome, have no idea what I'm allowed/ought to do.

LisaLou1982

Draw up an AST for the house as a whole with all three of them on the tenancy agreement. Rent should be stipulated as a whole - eg £600 a month. Its then up to them to decide how it is split

You might want to go down the guarantor route too - just to be on the safe side if theyre younger!

feisty1

illsio Under the changes in the Housing Act 2004, you should be aware if letting out as follows:
an entire house or flat which is let to three or more tenants who form two or more households and who share a kitchen, bathroom or toilet
You would require an HMO licence

TJ27

feisty1 wrote: »

illsio Under the changes in the Housing Act 2004, you should be aware if letting out as follows:
an entire house or flat which is let to three or more tenants who form two or more households and who share a kitchen, bathroom or toilet
You would require an HMO licence

Mandatory licensing applies to 3 or more storey houses of 5 or more people in 2 or more households. Different in Scotland I think.

This sounds like it will be a HMO but it's unlikely to be licensable. Worth checking with the council though. Additional or selective licensing might be in place.

olly300

illusio wrote: »

I've had an enquiry from someone who wants to rent with his 2 friends, all of whom are in full time jobs. The house is a 4 bed family home, not separate rooms/bedsits, and I'm not sure how best to go about it? Do they need separate tenancy agreements or can I ask one of them to rent the house and make a single monthly payment, and then they sort the details between them?

I don't want a scenario where one of three tenants isn't paying their rent and so I'm having to get rid of one/the remaining two can stay paying only two thirds. And I don't want to have to change the house into separate areas.

All advice welcome, have no idea what I'm allowed/ought to do.

1. You could rent the house out just to one of them for the whole charge. That individual would be responsible for paying the rent, sorting out the bills and reporting maintenance issues to you. How they do it is up to them as long as you get you rent. Yes the other 2 are subletting but just refuse to take any money from any off them directly or deal with them in anyway directly that way they are not legally your tenants but tenants of the main tenant.


2. You can rent your house out as LisaLou1982 mentioned.

InMyDreams

This must happen in student housing all the time. When I was a student, our LL told us we had to open a joint bank account and insisted a standing order was set up from that account for the full amount. He made it clear that we were not paying a fraction each, but were jointly responsible for the whole amount, and if the standing order didn't turn up it didn't make any difference to him who's fault it was.

olly300

InMyDreams wrote: »

This must happen in student housing all the time. When I was a student, our LL told us we had to open a joint bank account and insisted a standing order was set up from that account for the full amount. He made it clear that we were not paying a fraction each, but were jointly responsible for the whole amount, and if the standing order didn't turn up it didn't make any difference to him who's fault it was.

I always paid my rent separately to landlords even though the tenancy agreements stated we were jointly liable for rent and bills.

caljoemor

AST's state that tenants are jointly and severally liable. Meaning that each one of them are responsible for all the conditions in the agreement so they are all responsible for paying the whole amount of rent.

Up to four people can sign one agreement. I would advise you get them all to sign the agreement. If one leaves the other 2 would still have to pay the total amount of rent and not just there individual shares.

caljoemor

You shouldn't need a HMO licence you are letting out to 3 tenants as one residence under one agreement.

jennifernil

You would in Scotland.

CIS

If each person has a separate agreement to only pay their individual share of the rent then you may fall of Council Tax HMO rules in which the L/L would be the liable person for council tax,