Renting to companies, would you?

[NewToRenting]

We recently put our 4 bed house on rent (no longer live in UK). The estate agent has sent us the following mail about a prospective tenant:

"The property will be for a company let in the name of ‘XXX Properties Ltd’ they are a well-established company who specialise in the letting of rooms to professional individuals, they will take the property on, furnish it and then advertise the rooms, they will be fully responsible for the property and will keep paying the full rent no matter how many rooms are filled, they will also send in cleaners on a periodic basis to keep the place clean & tidy. They will also be responsible for all utilities at the house as well."

Would you do this? Any possible pitfalls I should be aware of?

Be careful.

Company let's are not all bad. I currently let to an expat banker whose bank is on the contract and who pays the rent. However the sort of let your estate agent is suggesting:

1. You have no control over who lives there. They may well say 'professional' but how is this guaranteed. FWIW Foxtons used to push company lets at landlords in Central London quite strongly...till housing benefit was capped. They presumably knew that landlords were reluctant to take benefits claimants but liked the sound of corporate. At the very least I would want to know who these 'professionals' were.

1. Company lets have a different legal basis so you would want to reassure yourselves that you could get the property back when you wanted.

1. What used to concern me was the idea that both the agent and then the Company were making money from my property. It sort of implied that the tenant themselves or whoever paid the rent for them, was paying over the odds.

1. We once bought a property which had been let on this sort of basis though to a family off the Council housing list. The family had not looked after the property (understatement) and though the Housing Assn had made good it was quick and shoddy work.

To be honest if you are not satisfied that the eventual tenants will be professional employees of the company, but like the idea of having a managed let of this sort, you might be better off going direct to a Housing Assn or similar. At least then you cut out the agents fees.

We let our 4 bed house to a company who used it to accommodate contractors rather than pay for hotels. They actually had 5 people staying as they also used the dining room as a bedroom. The bathrooms were intensively used and poorly ventilated so needed completely redoing afterwards. The kitchen wasn't so bad as they didn't really cook much and the oven was professionally cleaned but left an ingrained smell of takeaways and microwaved ready meals. The benefit was a regular guaranteed income.

Thanks, think I'll decline and ask them to look out for a family instead.

Decline!!!

Also your mortgage company may not like a company let. The one I have is pretty restrictive. However the property is mortgage free so it does not matter.

It's very much still on mortgage, that's why we need to rent it out.

I never thought of these issues, thanks everyone!