Young people are turning to illegal subletting to cope with London’s ‘exploitative and difficult’ private rental market.
Subletting is when tenants let out all or part of the place they live to a sub-tenant and depending on your housing agreement this could be a breach of contract.
It can offer newcomers the opportunity to try out living in London without a fixed-term contract, but some are increasingly turning to illegal subletting as a way to alleviate the capital’s surging cost of living — often without their landlord’s knowledge.
More than 68% of landlords have discovered tenants subletting their property without consent and one-in-five landlords found their property listed on websites such as SpareRoom, Airbnb or Gumtree, according to data published by Direct Line business insurance last month.
On illegal subletting, SpareRoom said: “Our terms, which all users agree to adhere to when registering, clearly state that if you’re advertising a room then you must have the necessary rights and permissions to do so.”
Subletting to find your feet
Joe (not his real name), 24, sublets out the box-room of his central London flat alongside his flatmate.
His landlord is unaware that there is a third person living in the property.
Together they pay more than £2,100 in rent per month, but charging their subletter £500 for the small room ‘makes me feel better that the bottom line is a bit lower’, Joe said.
He added: “Rent isn’t cheap and I think young people are always looking for either the extra income or ways to make financial life a bit easier.
“We’ve had friends staying since about two months into the tenancy and it means we’re saving an extra £250 each per month just from having that person stay.
“I’m 24 so most of my friends are looking for work. I have been in work for two years and I’ve realised there’s plenty of demand for a cheap room as people transition from not being in London to finding their feet.
“It’s been quite a useful thing for both sides — my friends have said it as well.”
Ava (not her real name), 23, moved into Joe’s spare room when she first moved to London.
She said: “It was great, especially as I was starting out in London and finding my feet. Everything is so expensive so it gave me a few months to enjoy London without having to worry about it.
“Before moving in I was pretty anxious about [the landlord not knowing] but overall it was fine. There was one day when maintenance guys were coming into the house. I just put my stuff in a suitcase and made it look like a storage room.”
Soaring rent prices
The recommended percentage of income spent on rent is 30%, but the average spent in London is more than 41%, according to ONS data from last year.
Nye Jones, Head of Campaigns renter’s rights charity Generation Rent said: “Demand and cost are going up and there’s a feeling that you have to do a lot to find somewhere that’s affordable and secure.
“Often that means taking a home that’s pretty poor quality, or not in the area you want to live, or looking for informal arrangements where you have less rights and security because you’ll do anything to leave that wild-west rat-race behind.
“People are doing the best they can in London and sometimes it’s the rational decision to sacrifice certain rights and have informal arrangements in order to pay a bit less or avoid the endless process of looking for somewhere.”
One of the most common ways young renters find sublets is through apps like SpareRoom – the UK’s largest housesharing platform.
SpareRoom’s own data showed the average room rent in inner London is now £995 per month.
The company said: “There’s more than one contributing factor, but perhaps the biggest problem is the lack of rental supply, which is a historic problem.
“Across London, there are three people searching per room available to rent, and that level of demand is keeping rents inflated. Although there’s no silver bullet that’ll solve the housing crisis, there are creative ways to boost rental supply. The government has a goal to build more houses, but that’s a long-term fix, and the rental market needs supply now.”
The rights of sub-tenants
Yusuf, 23, used SpareRoom to legally sublet his room with the landlord’s permission ‘despite him not being too fond of the arrangement’.
He found a sub-tenant ‘almost immediately’, believing this to be an indicator of the demand for cheap, flexible and short-term housing.
However, the sub-tenant left after only a week due to a maintenance issue he was unhappy with.
Yusuf said: “That kind of situation has to go through me as the official tenant, and I think it’s quite unfair on the sub-tenant because they can’t really have any formal complaints towards the landlord.”
While sub-tenants can find themselves without a contract, squeezed into a small room, and even hiding from the landlord, they have more rights than they realise.
Jones said: “Sub-tenants actually have more rights than people often think. It’s a bit of a weird situation which means the original tenant becomes the sub-tenant’s landlord, and even though the tenancy is unlawful, the landlord to the original tenant can’t actually evict them legally without a court order.
“In terms of renting – peoples rights and protections are only really as good as their knowledge of them. Often that’s the same for more normal tenant relationships as well.
“We see landlords abusing the law all the time and tenants, if they’re not aware of their rights, don’t interrogate it. So, if you enter into informal, under-the-radar agreements, the usual signposts towards your rights aren’t there.”
Social media and through word of mouth are other popular ways to find an illegal sublet.
Earlier this year, Suzi, 24, wanted to move out of her parent’s home and live closer to friends in London.
A friend-of-a-friend was doing a four-month sabbatical and was looking for someone to sublet unofficially to avoid the £400 fee to change the tenancy name.
Suzi’s landlord doesn’t know she lives there and she has no written agreement with the other tenants or the person whose room she’s in.
“I transfer her the money each month for rent and bills… it is all based on friendship and trust because I knew one of the girls in the flat previously,” she said.
New legislation is coming
Labour’s flagship renter’s policy, the Renter’s Rights Bill, received royal assent last month and is expected to come into effect in 2026.
It will remove no fault evictions, reduce how often landlord’s can increase rent, and implement rolling-tenancies which will be attractive for those seeking short-term housing.
However, Jones argued that the bill doesn’t go far enough.
He said: “The difficulty we’re facing is a result of repeated political decisions, particularly the loss of social housing.
“A vital first step is addressing the power imbalances between renters and members, but particularly in London. We need to see the Mayor given powers to cap the cost of rent.
“People in London just like me are paying far, far too much of our income on rent which is being swallowed up by landlords, removed from local economies and pricing people out of the city.
One of the bill’s strengths, according to Jones, is that it will end bidding wars where prospective renters offer the landlord more than the advertised price.
Jones said: “There’s nothing worse than queueing for a viewing, getting there and being told that someone’s already made an offer at £300 above the asking price and the asking price was your limit. That’s really demoralising.”
Paul Shanks, Press Officer at Renter’s Reform Coalition, said: “it’s a pretty exploitative and difficult renting market for renters.”
Shanks called the Bill’s abolition of Section 21, that allowed landlords to carry out no fault evictions, will be a huge step forward for renters.
He added: “That means you’ll have more security in your home but will be calling for the government to go further when it comes to making renting more affordable because that’s one area that this legislation doesn’t address.”
Featured image credit: Nadzeya Matskevich
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