Lease to my business then sublet???

[--(< PJ >)--]

Hello folks,

I have something to run past you.

It's a bit cheeky.

I'm interested in buying a house that has three self contained 'units' (like house with two granny flats in addition). Because it's not officially a triplex, I can't rent it out like a normal block of flats. One of the self contained areas has its own power supply, but all three are on one water meter.

So anyway, most of you would run a mile by now (so would my property manager). That's okay. Stop reading now or you'll be horrified. For the rest of you, please read on.

So anyway, I've been reading the legislation tonight. (And thus ruled out F18 Rooming Accom option.)

It looks like I could rent out the house to one tenant, but that it would be reasonable for the tenant to be able to sub-let the three areas (i.e. units) to other tenants.

I have a business. It strikes me that my business could be my tenant, and sub-let three leases in keeping above-board with the RTA forms and formal bond and such while not being in breach of Council planning laws either. The other head lease option might be to rent it to a family member and have them sub-let it out.

Which is where I get to my question... has anyone on here done/tried something like this? Your thoughts?

Penelope.

 

[Propertunity]

Along similar lines, an investor friend of mine had a house with a non-approved granny flat. The council wrote a letter to him asking him to stop reting out the non-approved flat (after a neighbour complained). His course of action was to do a head lease to the house tenant for the entire property. The house tenant's course of action was to sub-let the flat.

 

[Terryw]

Why rent to the business?

If the business is sued by a tenant it just creates added risk. Maybe a new Pty Ltd would be better. But I am not sure how adding another layer would allow you get to around any laws in the RTA. Do you have a specific example in mind?

 

[--(< PJ >)--]

Hi guys. No, it's not getting around any RTA laws. All ok for that. It's the local council planning laws that are the issue.

For example, you could build an immaculate standard type triplex on a block of land you own. As far as the RTA is concerned, you're okay and welcome to rent out each of the units. As far as the Council is concerned, you're a very bad person and immoral investor.

This triplex is pretty well done... but it was done as modification to the home by the owners to give their no-hoper adult children with kids somewhere private to live. They didn't do it as an investment or strata title it etc, or bother with the Council.

Hence... my issue is the planning laws not the RTA.

Yes, the litigation issue is a consideration... but I have other properties and fantastic property lawyers for litigation type issues.

The central question is... has anyone done such a structure?

 

[The Y-man]

When we did rooming houses, we had the propoerty in our name, our trust was the main tenant that furnished the property, and the turst sublet by the room.
The Y-man

 

[--(< PJ >)--]

Thanks Y-Man! Good to know it is feasible.

 

[vaughan]

Along similar lines, an investor friend of mine had a house with a non-approved granny flat. The council wrote a letter to him asking him to stop reting out the non-approved flat (after a neighbour complained). His course of action was to do a head lease to the house tenant for the entire property. The house tenant's course of action was to sub-let the flat.

Did this solve the problem with council? As far as I can see, the non-approved granny flat still has people living in it, so council could still be unhappy.

 

[jesicalans]

Lease

The maintenance claim in leased property is a big disputed matter in 9 out of 10 times.