Why Landlords Choose Company Lets Over Traditional Renting
A company let swaps an individual tenant for a registered company and a variable income for a fixed one. For some landlords that is the whole appeal. This article sets out what changes when the tenant on your lease is a company.
What a company let is
In a standard tenancy, a private individual signs the agreement and pays the rent. In a company let, a registered business signs the lease. The company is responsible for the rent and for looking after the property for the whole term, whoever is living there.
What changes for the landlord
- The rent is fixed for the term, usually one to three years.
- Rent is due whether or not the property is occupied, so there are no void periods.
- There is no tenant search, referencing or re-letting between occupiers.
- You deal with one counterparty for the whole term.
What to check before you agree
A company let is a commercial arrangement, so the detail matters. Check who the company is, how long the term runs, what the break clauses are, who is responsible for which repairs and in what condition the property must be returned. You should also confirm that your mortgage lender, freeholder and insurer allow it.
Is it right for every landlord?
No. If you want to choose each occupier yourself, or you expect to sell within the year, a standard tenancy may suit you better. A company let works best for landlords who value certainty and want to step back from day-to-day involvement.