What is Rent to Rent?
Rent to Rent (also known as R2R or RTR) is an arrangement where a landlord rents their property to a company, which then sublets the property to occupiers of their choosing. These schemes are often marketed as “guaranteed rent”.
While rent to rent can work in certain circumstances, there are multiple variations of these schemes. The structure, professionalism, and legitimacy of companies offering them can vary significantly, which is why it is essential for landlords to understand the risks, legal implications, and correct way to set them up.
How Does a Rent to Rent Agreement Work?
In a typical rent to rent arrangement, a bilateral contract is created:
The landlord (Party A) grants a tenancy to the R2R company.
The R2R company then sublets the property under a separate agreement to occupiers of their choosing.
Crucially, this means there is no direct contractual relationship between the landlord and the occupier.
If the R2R company were to dissolve or cease trading, the landlord could be left with a sitting occupier in the property with whom they have no legal agreement. This creates legal loopholes and can result in a costly and complex eviction process. In addition, without a direct contract:
The occupier does not owe rent to the landlord.
If the R2R company has dissolved, neither do they.
How Can Rent to Rent Be Done Safely?
To mitigate these risks, all parties should be incorporated into one combined agreement, supported by robust contingency clauses.
A critical provision should state that if the R2R company ceases trading or dissolves, the landlord automatically becomes the direct beneficiary of the rent and the contractual relationship with the occupier.
This provision should be considered essential. I would never recommend a landlord participate in a rent to rent scheme without it, regardless of:
The length of the occupier’s stay
Whether the arrangement is short-term, Airbnb-style, or serviced accommodation
Whether the R2R company uses tenancy agreements or only terms and conditions
Without this safeguard, the risks are simply too high.
Who Is Responsible For Repairs?
While some agreements make the R2R company financially responsible for certain repairs and maintenance, landlords should proceed with caution. Allowing a third party to manage maintenance without oversight can lead to:
Unauthorised modifications
Poor workmanship
Repairs that invalidate your insurance
Best practice: Clearly define maintenance responsibilities in writing. The R2R company may be financially liable for specified items, but:
They must inform you of all issues first
They must explain proposed remedial action
No works should proceed without your consent
Any works must also comply with your insurance policy. For example, installing lockboxes for short-term lets may seem minor, but many insurers have strict rules regarding their type and placement.
These precautions may appear over cautious, but without them, landlords face significant legal and financial exposure. Ultimately, landlords are almost always held liable - never leave the care of your asset to chance.
Vetting Occupiers and Preventing Risk
Although you may have a contract with the R2R company, they are not the living in and acting as the caretakers of your property. You are trusting them to place suitable and responsible occupiers into your investment. Because the R2R company selects the occupiers, due diligence is essential. Unfortunately, some schemes have been linked to:
Criminal activity
Illegal occupants
Severe overcrowding
Each of these scenarios can expose landlords to serious legal consequences.
Ask critical questions:
Who is the target tenant demographic?
Are they professionals? If so, which types (e.g. nurses, pilots, contractors)?
How long do occupiers typically stay?
How frequently is the property cleaned and inspected?
Different tenant groups have different needs and suitability. As the property owner, you must understand exactly who will be living in your property and how it will be managed.
What Type of Rent to Rent Companies Should You Consider?
Thorough research is essential. At a minimum, you should establish:
How long the company has been operating
Their filing history at Companies House
Director changes and company structure (and frequency of said changes)
Reviews and reputation
The number of properties they currently manage
The purpose of the scheme (Airbnb, serviced accommodation, professionals, social housing)
You should also confirm:
Whether they are insured
Whether they comply with PRS legislation (ICO, CMP, redress schemes, PII, PLI)
Whether they can provide evidence of compliance
How the rent is “guaranteed” (insurance-backed or otherwise)
Any liability limits within that guarantee
These checks help you understand the scope, stability, and risk profile of the company you are dealing with - and allow you to put contingencies in place should circumstances change.
So, Can Rent to Rent Work?
Yes..... but only under strict boundaries and clearly defined conditions.
Landlords should expect to remain partially involved, including:
Conducting regular inspections
Maintaining oversight of compliance
Maintaining oversight of repairs and maintenance
Ensuring appropriate contractual protections are in place
Rent to rent is not a “hands-off” solution. When done correctly, it can work. When done poorly, it can expose landlords to serious financial and legal consequences.
