Investopedia

Continue to Site »

Sublease

Filed Under » , ,
Dictionary Says

Definition of 'Sublease'

A real property rental agreement between an original tenant and a new tenant. The most common type of lease arrangement is between the landlord who owns the property and a tenant. If that tenant finds him or herself unable to continue meeting the terms of their lease, they may opt to create a sublease if the landlord allows it. The sublessee is subject to the same rental terms that the original lessee was subject to. Subleases can be executed for both residential and commercial properties.
Investopedia Says

Investopedia explains 'Sublease'

Because a lease is generally for a predefined term, situations can arise that make it difficult or impossible for the original tenant to complete the lease term. For example, if Sebastian is renting an apartment in Chicago with a 12-month lease and in month four he receives a job offer in Boston, he may decide to sublease his apartment to another tenant for the remaining eight months. The sublease means that Sebastian can accept the job and move - he doesn't have to pay expensive fees to get out of his lease or pay rent on two apartments. The landlord also benefits because he receives all 12 rent payments and doesn't have to find a replacement tenant. The sublease arrangement also means that Sebastian retains an interest in the apartment, so if he decides to move back to Chicago, he may be able to renew his lease and get his old apartment back.

Articles Of Interest

  1.

    Should You Buy Property On Leased Land?

    Find out what to consider before investing in a leased-land property.

  2. Top 10 Features Of A Profitable Rental Property

    Find out what factors you should weigh when searching for income-producing real estate.

  3. Tax Deductions For Rental Property Owners

    Besides creating ongoing income and capital appreciation, real estate provides deductions that can reduce the income tax on your profits.

  4. To Rent Or Buy? There's More To It Than Money

    Your lifestyle, level of commitment and the trade-offs need to be carefully weighed.

  5. To Rent Or Buy? The Financial Issues

    Thinking of buying a home? We look at the initial and ongoing costs as well as the so-called benefits.

  6. The Complete Guide To Becoming A Landlord

    Being a landlord can be a fulfilling and financially rewarding experience. However, the decision to become a landlord should not be taken lightly.

  7. Reasons Renting Is Better Than Buying

    Owning a home is much more expensive than renting. Here are the places where the costs differ greatly.

  8. Retirement Living: Renting Vs. Home Ownership

    Here are three simple questions you should consider when weighing this decision.

  9. Why You May Want To Think Twice About Renting Out Your Home

    Short-term renting is not for everyone. Significant risks to opening up your home to strangers may outweigh the inflow of cash.

  10. 6 Ways To Get Your Full Security Deposit Back

    When renting an apartment, a security or damage deposit is almost always required. Here are some tips to help you avoid unforeseen circumstances and get your money back in its entirety when you ...
comments powered by Disqus
Marketplace
Hot Definitions

  1. Disaster Loss

    A special type of tax-deductible loss, similar to a casualty loss, where a loss has been incurred by taxpayers who reside in an area that has been designated as a federal disaster area by the President.

  2. Fool In The Shower

    The notion that changes or policies designed to alter the course of the economy should be done slowly, rather than all at once.

  3. Pattern Day Trader

    An SEC designation for traders who trade the same security four or more times per day (buys and sells) over a five-day period, and for whom same-day trades make up at least 6% of their activity for that period.

  4. Cost-Push Inflation

    A phenomenon in which the general price levels rise (inflation) due to increases in the cost of wages and raw materials.

  5. Happiness Economics

    The formal academic study of the relationship between individual satisfaction and economic issues, such as employment and wealth.

  6. Affluenza

    A social condition arising from the desire to be more wealthy, successful or to "keep up with the Joneses." Affluenza is symptomatic of a culture that holds up financial success as one of the highest achievements.
Trading Center