Rent-to-rent can be a brilliant property strategy — but it’s not without risk. From legal pitfalls to tricky tenants, understanding the potential downsides is essential before diving in.

In this post, we’ll explore the most common risks associated with rent-to-rent, and more importantly, how to avoid them with smart planning and the right mindset.

1. Legal and Compliance Risks

The Risk:
Operating a rent-to-rent business without the proper permissions or licenses can land you in hot water. You could face fines, legal disputes, or even be shut down altogether.

Avoid It By:

• Getting written consent from the landlord to sublet or manage the property

• Using proper legal contracts, like a company let agreement or management agreement

• Checking whether the property needs an HMO licence and meeting all local council regulations

• Keeping up with tenant deposit protection and Right to Rent checks

📌 Tip: Consult a property solicitor to review your contracts — don’t download a random template and hope for the best.

2. Void Periods (Empty Rooms)

The Risk:
You’re still on the hook for rent to the landlord even if some (or all) of the rooms are empty. If you don’t fill them quickly, you could end up out of pocket.

Avoid It By:

• Choosing properties in high-demand areas

• Offering a great product at the right price

• Using platforms like SpareRoom and OpenRent with good marketing

• Building relationships with local employers, colleges, or agents who can refer tenants

3. High Maintenance Costs

The Risk:
Because you’re managing the property day-to-day, you might get hit with unexpected maintenance bills, especially in older or poorly maintained properties.

Avoid It By:

• Agreeing clear terms with the landlord about who’s responsible for what

• Conducting a full property inspection before signing any agreement

• Budgeting a portion of your monthly income for repairs and upkeep

• Doing routine maintenance to avoid bigger issues later on

4. Problem Tenants

The Risk:
Late payments, antisocial behaviour, and property damage are just a few of the headaches that can come with difficult tenants.

Avoid It By:

• Having a rigorous tenant screening process

• Setting clear house rules and tenancy agreements

• Keeping communication open and respectful

• Having a plan for evictions and disputes if things go south

📌 Tip: Good tenants make a good business. Don’t rush to fill rooms just for the cash.

5. Burnout and Poor Time Management

The Risk:
If you take on too many properties without proper systems, rent-to-rent can become overwhelming and stressful — not the “passive income” dream you were sold.

Avoid It By:

• Creating standard operating procedures for everything from check-ins to maintenance

• Using tools to automate admin

• Outsourcing tasks like cleaning, maintenance, or even tenant messaging

• Focusing on quality over quantity in your portfolio

Final Thoughts

Every business comes with risk — rent-to-rent is no exception. But when you’re aware of the pitfalls and plan for them, this model can offer excellent returns with relatively low start-up costs.

Start small, learn as you go, and set up the right foundations from the beginning.

Want to learn how experienced rent-to-rent operators manage risk like pros?

Join our free Rent-to-Rent Community to get access to practical tips, contracts, and support from people who’ve already been through the ups and downs. Your future self will thank you!