Permission for Subletting
Anyone looking to sublet an apartment must obtain approval for the subletting.
Information for the landlord
If you plan to rent out your property, there are several things you need to consider.
Rent Level
The permissible rent amount depends on whether it is a rental apartment or a condominium.
Security for Both Parties
It is advisable to establish a written contract when subletting. It provides security for both parties and addresses any potential conflicts that may arise.
Termination & Tenancy Protection
Regulations around giving notice and information on security of tenure.
Damage in the Property
During the lease period, the tenant is responsible for maintaining the residence in good condition. This entails using it with normal care and consideration.
Information for the landlord
Renting out your property
If you are planning to rent out your property, there are several things you need to consider.
Different regulations will apply depending on whether it is a rental apartment or a condominium/house that’s being rented out. The subletting of rental apartments, “hyresrätter” is governed by the 12th chapter of the Land Code, known as the Lease Act or “hyreslagen”. For condominiums and privately-owned houses, regulations are outlined in the Private Lease Act or “privatuthyrningslagen”. This legislation offers more favourable conditions for landlords compared to the Lease Act.
It´s worth noting that the Private Lease Act applies only to one single unit. If you rent out two apartments, the Private Lease Act applies only to the first rental. Renting out more than two residences is considered a commercial activity, and the Lease Act will be applied to all of the tenancies.
Approval for Subletting
Approval for Rental and Condominium
You must ensure that you have approval to sublet your apartment.
Rental Apartment
You will need to have permission from your landlord. If your landlord does not grant approval, you can apply for permission from the Rent Tribunal instead. Valid reasons for subletting may include temporary relocation for studies or work in another location, trying out cohabitation, or an extended stay abroad. The rent you charge should also be reasonable.
Condominium
Permission should be sought from the housing cooperative (bostadsrättsföreningen). The regulations are similar to those for rental apartments, with the distinction that for condominiums, it is sufficient for the owner to have 'reasons' for the sublease. There is no requirement for 'significant reasons', as in the case of rental apartments.
Remember to apply for permission well in advance. If the lease is established before approval have been granted, it should be stated in the agreement that its validity is contingent upon receiving approval.
No approval is needed if you’re solely subletting a room or a part of the apartment to a lodger. The terminology used for the agreement is not significant; what matters is that, as a landlord, you maintain residence in the apartment, thereby retaining control over it.
Rent level
What is an allowable rent?
Rental apartment
To be considered reasonable, the rent should not surpass the rental amount you pay yourself, with an additional consideration for furniture, equipment, and other amenities. If you rent out a furnished property, a surcharge of up to 15% can be added to the rent.
Actual costs for utilities, such as electricity and internet, included in the rent, are also allowed. If the rent you charge is deemed unreasonable, you may risk losing your lease. You can also be retroactively liable for repayment for up to 2 years.
Condominium
A reasonable rent for renting out a condominium or house should be determined by the property’s expenses and value.. More precisely, the cost consists of two components – the capital cost and the operating cost. The rent charged must not significantly exceed the combined total of capital and operating costs.
The capital cost is a flat rate and is calculated as a reasonable annual return rate on the market value of the property. An interest rate of 2 percentage points above the central bank's reference rate is generally considered acceptable. The return rate is an estimated cost of having the capital tied up in the property: it’s irrelevant whether the landlord has a loan on the property or not.
Let's assume a condominium was purchased for 3 million SEK, and a reasonable return rate is 4%. The capital cost would then be 120,000 SEK (3,000,000 x 0.04) resulting in a monthly capital cost of 10,000 SEK.
Operating costs are essential expenses included in the rent, such as electricity, water, or parking. Wear and tear on furniture can also be included if the property is rented furnished. Operating costs are not a flat rate; it’s your actual expenses that matter.
Lease Agreement
Security for Both Parties
You should always establish a contract for a sublease. It provides security for both parties and addresses any potential conflicts that may arise.
There is a lot to consider when drafting a lease agreement. The parties do not have complete freedom of contract; a lease agreement must always be set up in consideration of the tenancy legislation. The Lease Act, as well as the Private Lease Act, is protective legislation aimed to safeguard the tenant, ensuring that tenants are not subjected to unfair conditions. This means that contractual terms that provide less favourable conditions for the tenant are invalid. The legislation also establishes criteria for how, for instance, termination should be conducted to be considered valid.
Rent and deposit should not to be paid until the lease agreement has been fully signed.
Subletting
Responsibilities and Rights
Even if you sublet, you remain responsible for the apartment and for your tenant. It is your duty to ensure that the rent is paid on time and that the tenant fulfils their obligations. You are accountable for the standard of the property and for having it professionally cleaned upon move-in. The tenant has a corresponding obligation upon move-out.
As the landlord, you do not have the right to enter the property without the tenant's permission. There are exceptions, such as in the case of fire or water leakage.
Security of Tenure
Applicable Rules
Security of tenure refers to the legal protection that tenants have, allowing them to remain in the property even if the landlord wishes to terminate the lease agreement. This protection is a fundamental rule when renting from a professional landlord. A tenant who sublets does not have the same level of protection. However, if a subtenancy last for more than two consecutive years, the subtenant may be eligible for security of tenure.
The security of tenure can be voluntarily relinquished or waived. If you plan to rent out your apartment for a period exceeding two years, it may be advisable to set up a waiver agreement.
If you prefer your tenant not to have security of tenure, you can utilize the form 'Överenskommelse om att avstå från besittningsskydd' (HN4). This form is legally valid without requiring approval from the Rent Tribunal. The form can be obtained from the Swedish Courts.
If you, as an individual property owner, decide to rent out your property, the rental agreement will be governed by the Private Lease Act. Under this legislation, there is no provision for security of tenure for the tenant.
Termination of a Lease Agreement
A lease agreement must be terminated to cease its validity
A lease agreement can be valid for a fixed period or until further notice. The general rule is that a lease agreement needs to be terminated in order to expire.
Rental apartment
If you sublet your rental apartment for a fixed period, you are, as a landlord, legally bound to the duration of the contract.
The tenant, however, can always terminate the lease with a notice period of 3 calendar months. This entails that the agreement will conclude at the end of the month closest to 3 months from the notice of termination.
This right is granted by Swedish tenancy laws and applies irrespective of what has been agreed between the parties. It also applies regardless of whether the lease is for a fixed period or open-ended.
An open-ended contract must always be terminated in order to expire. In indefinite-term subletting agreements, both parties have a mutual notice period of 3 calendar months.
An agreement that runs for a fixed period may, under specific circumstances, be converted into an open-ended agreement. This occurs if the agreement is not terminated by the end of the lease period, even though termination is required (applies to all agreements with a duration exceeding 9 months), and the agreement lacks a provision regarding the consequences of failure to give notice.
Termination of a Lease Agreement
Lease Agreement for Condominium/House
If you, as a private individual, rent out your house, owner-occupied apartment, or condominium, the legislation allows for a little more flexibility.
Let’s assume the agreement is set for a fixed period, for instance for one year. Such an agreement will automatically cease at the end of the lease period without the need for any notice of termination.
The agreement can also be terminated prematurely, either by the tenant or the landlord. You do not need any specific reason to terminate the lease. In this case, the landlord has a notice period of 3 calendar months, and the tenant has a notice period of 1 calendar month.
This is all assuming that the lease is covered by the Private Lease Act.
Termination of a Lease Agreement
How to serve the tenant your notice of termination
Notice of termination is to be served in writing. An email is sufficient, provided that the recipient confirms receipt of the email and the notice of termination. The termination is then considered to have occurred on the day the receipt is confirmed.
If confirmation is not received, the termination should be sent by registered mail instead. In this scenario, the termination is considered to have occurred on the day the registered letter is sent. Therefore, it’s crucial to keep the receipt as evidence.
Keep in mind that the notice of termination must be served on the “correct” side of the month. If the termination is executed and confirmed by May 31, it means that the tenant must move out by August 31. If the termination is made on June 1 (or later in June), the tenant can stay for an additional whole month.
Damages to the property
What happens if there are damages to the property?
The tenant is required to responsibly maintain the property during the lease period, ensuring it is inhabited with proper care.
Pure accidents are not the tenant's responsibility, but if damages occur due to the tenant's actions, negligence, or neglect, the tenant is liable to compensate for them.
Normal wear and tear however must be accepted by the landlord. This includes damage that arises from normal usage, such as holes in walls from hanging pictures, minor scratches on the floor from furniture, and moderate grease stains. Abnormal wear and tear could be a broken window pane, cracks in sanitary porcelain, burn marks, or water stains from flower pots. Deciding what is normal wear and tear can sometimes be challenging and may need to be determined on a case-by-case basis.
To be entitled to compensation, the landlord must prove not only that the damage is caused by the tenant, but also that it falls outside what can be considered normal wear and tear.
Determining whether damage occurred during the lease period or if it was pre-existing at move-in can pose a challenge. The surest way to discern this is through documentation of the residence’s property at the time of move-in. Therefore, it is crucial to carry out a move-in inspection. To have evidential value, the inspection report should be approved and signed by both parties. For more information on what is generally considered normal wear and tear, see the link to the Move-Out guide.pdf
