Many people don’t realise they can be landlords without letting out an entire property.
If you rent out a room in your own home while living there yourself, you’re what’s called a live-in landlord.
This comes with its own set of rules and responsibilities that are different from those for landlords who let whole houses or flats.
In this guide, we’ll explain what being a live-in landlord means, what you need to do to stay on the right side of the law, and how to manage lodgers fairly and easily.
- What is a live-in or resident landlord?
- Your responsibilities as a live-in landlord
- Financial benefits of taking in a lodger
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What is a live-in or resident landlord?
Most people think of a landlord as someone who rents out a whole property. Like a typical buy-to-let landlord who lets a house or flat under an assured shorthold tenancy (AST) and follows specific legal rules.
But if you rent out just a room in the home where you live, you are considered a live-in or resident landlord.
While you still have certain legal responsibilities, these tend to be less strict and often come down to common sense.
Your responsibilities as a live-in landlord
As a live-in landlord, you have certain responsibilities to keep your home safe and comfortable for both you and your lodger – someone who rents a room in your house and shares communal areas.
While the legal requirements are generally less demanding than for landlords who let out whole properties, there are still important rules you must follow.
For example, you need to arrange an annual gas safety check carried out by a Gas Safe registered engineer, and ensure all electrical appliances and installations are safe.
You’re also required to fit smoke alarms on every floor and provide carbon monoxide detectors where necessary. These are some of the key legal duties you must meet to protect everyone in your home.
Right to Rent
It’s the landlord’s responsibility to ensure that any lodger has the legal right to rent and live in England. For UK citizens, a valid photo driving licence will usually suffice. However, if your lodger is from overseas, different rules apply, and you’ll need to check additional documents such as their passport or visa.
For more detailed information, you can refer to our guide on Right to Rent checks.
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Gas and electrical safety
As a live-in landlord, you are required to arrange an annual gas safety inspection carried out by a Gas Safe registered engineer. You will receive a gas safety certificate (CP12), and you should provide a copy of this to your lodger. Likewise, you must ensure that all electrical systems and appliances are safe to use. The most effective way to do this is by having portable appliance testing (PAT) and an Electrical Installation Condition Report (EICR) carried out.
Smoke and carbon monoxide alarms
Most homes already have a smoke alarm on each floor, but it is now also a legal requirement for resident landlords to install carbon monoxide detectors as well.
Furnishings and product safety regulations
All furniture and furnishings your lodger uses or might use – both in their room and in shared areas – must meet the latest fire safety standards. Moreover, all other appliances and equipment, such as microwaves, ovens, lighting, and washing machines, must comply with product safety regulations overseen by your local Trading Standards office.
HMO classification
If you have more than two lodgers living in your home, your property may be classed as a house in multiple occupation (HMO). This could mean you need to apply for an HMO licence from your local council. It’s important to check your local authority’s website to understand their specific licensing requirements.
For a detailed explanation, you can refer to our in-depth guide on HMO classification and licensing.
Taking in a lodger: What you need to know
What is a lodger?
A lodger is someone who rents a bedroom within your home and shares access to communal areas such as the bathroom, kitchen, stairs, corridors, and, optionally, the living room. Unlike a tenant, a lodger pays a licence fee rather than rent, which usually includes council tax.
While the licence fee generally covers council tax, the lodger is typically expected to contribute fairly towards utility bills. Alternatively, you can include these costs within the overall licence fee.
Licence agreements usually run on a periodic basis (for example, month to month) or on a fixed term. Terminating a lodger’s agreement during the fixed term is more straightforward than it is for ASTs, and landlords are generally only required to give 28 days notice.
Excluded occupiers
If you share your primary home with your lodger and share essential facilities like the kitchen and bathroom, your lodger is classified as an excluded occupier. This legal status recognises that lodgers have fewer protections compared to tenants renting under ASTs.
As a live-in landlord, you only need to give your lodger “reasonable notice” to quit, usually equivalent to one rental period. You can evict excluded occupiers “peacebly”, for example by changing the lock on their room once notice has been given. You must take reasonable care of the lodger’s possessions in this case.
Referencing your lodger
One of the biggest mistakes live-in landlords make is skipping proper referencing, even if the lodger is someone they already know.
It can be tempting to trust your first impression when someone comes to view a room, but remember: you’re inviting this person to share your home. It’s important to learn a bit about them beforehand, especially their financial situation.
You want to be confident that your lodger is responsible, won’t damage your property, and will pay their rent on time. You would not hesitate to carry out tenant referencing checks if you own a buy-to-let property, so there is no reason to ignore it for a lodger.
Here are some key checks you should consider:
- Previous landlord references: Don’t hesitate to call and ask about their past behaviour as a tenant.
- Payslips: Three months’ payslips will help you see if they have a steady income and can afford the rent.
- Proof of identity: This confirms they have the legal Right to Rent in the UK, which is a legal requirement for landlords in England.
- Employer references: These can reassure you that the lodger will keep earning and can pay their rent.
- Credit checks: These reveal any outstanding County Court Judgments (CCJs) and help verify identity.
Taking these steps will give you peace of mind and help make sure your lodger is a good fit for your home.
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Licence agreements vs ASTs
If you’re a live-in landlord, the main difference to know is that lodgers don’t get an assured shorthold tenancy (AST). Instead, they have a licence agreement. This means lodgers have fewer legal rights, and you, as the resident landlord, have more flexibility and control.
A lodger usually rents a room in your home and shares common areas like the kitchen, bathroom, stairs, and hallways with you. As the homeowner, you normally have the right to enter their room if needed. If you don’t have access to their room, the lodger might have stronger legal protections.
A licence agreement helps protect your rights as a landlord by clearly setting out the rules for the lodger’s stay. How detailed this agreement is can vary, but it usually covers things like how much rent is due, how notice to leave works, and any house rules.
Fixed-term or periodic?
A licence agreement can be either fixed-term or periodic. A fixed-term agreement means you agree your lodger can stay for a set period, such as six months. When that time ends, the lodger either leaves or you agree on a new arrangement.
A periodic agreement works like a rolling contract, usually on a week-by-week or month-by-month basis. It continues automatically from one period to the next without needing to be renewed. That is, unless you, as the live-in landlord, want to change something, like the rent or other conditions.
Deposit rules and protection
When you take a deposit from a lodger, the rules are different from those that apply to tenants on assured shorthold tenancies (ASTs). Unlike AST deposits, lodger deposits don’t usually have to be protected in a government-approved tenancy deposit scheme.
This is because lodgers have fewer legal rights, and licence agreements are less formal than tenancy agreements. However, it’s still good practice to handle deposits fairly and keep clear records of the amount paid, what it covers, and the condition of the room when the lodger moves in.
If you take a deposit, it’s wise to put the details in writing in the licence agreement so both you and your lodger understand how and when the deposit can be used or returned.
Rent and bills
The licence agreement for a lodger will set out the rent amount and when it’s due, usually weekly or monthly. It should also explain which bills the lodger will contribute towards.
Typically, lodgers pay a fair share of the utility bills, such as gas, electricity, water, and broadband. However, this share should reflect their actual use. For example, if you have a family of four plus a lodger, it wouldn’t be reasonable to expect the lodger to pay half the bills.
Many landlords find it easier to agree on a fixed amount for bills, added to the rent. This way, the lodger pays one single sum each month, making budgeting simpler for everyone.
Notice periods and eviction rights for live-in landlords
As a resident landlord, you have the right to end the licence agreement and ask your lodger to leave. As previously mentioned, lodgers are considered an “excluded occupier” if they share some of the living accommodation. This means you don’t need to go to court to evict them.
If your lodger is on a rolling licence agreement, you can end it by giving notice, usually one week or one month, depending on what the agreement says. The agreement should also state whether the notice must be in writing or if verbal notice is enough. If no specific notice period is set, you must give “reasonable notice”.
For lodgers on a fixed-term agreement, you simply don’t renew the licence when the term ends, and the lodger should leave. However, it’s important to remember that you’re generally required to give 28 days notice.
If the lodger refuses to leave after the notice period or fixed term, you have the right to evict them “peacebly”, which could include changing the locks. You can also apply to the court for a possession order, but only if you’ve given proper notice first.
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Financial benefits of taking in a lodger
One positive aspect of having a lodger is the government’s Rent a Room Scheme, which allows you to earn up to £7,500 a year tax-free by letting out furnished accommodation in your home. If you share the income with a partner, this tax-free allowance is split between you.
To learn more about how this scheme works and what you need to do to benefit, check out our in-depth guide on the Rent a Room Scheme.
Final thoughts
If you’re thinking about renting out a room in your home, it’s important to know what you’re getting into. Being a live-in landlord means juggling your own space with someone else’s, so having clear rules and understanding your responsibilities is key.
Take the time to get your agreements right and know the basics of the law – it’ll save you headaches down the line.
With a bit of planning, having a lodger can be a simple way to earn extra income while keeping your home safe and comfortable.