Renting out sleepouts

Ray asks:
(updated on Friday, October 09th 2020)

What constitutes a separate unit being rented out with regards to sleep outs? Does a sleepout need to have a stove, kitchen sink, bathroom for it to be a separate unit? That is a self contained unit. Thanks.

Our Experts Answer:

The Residential Tenancies Act defines a tenancy as “the right to occupy the premises (whether exclusively or otherwise) in consideration for rent”. Generally this is understood to mean a property (or an area of property) over which a person has control in exchange for rent. A sleepout is normally regarded as self-contained. Some are set up for family accommodation as an extension of the main house. They don’t have an installed stove (because the family will usually eat together in the main house). A local authority may have consented the “sleepout” or “granny flat” for this purpose.

It cannot be let separately as a standalone residence. There have been instances where a granny flat without the appropriate consents has been separately rented, and the Tenancy Tribunal has ruled the tenancy as an unlawful tenancy. This can be very costly for a landlord. In some cases all rent has been ordered to be refunded. I suggest you contact your local authority and find out what is required for separate renting of a sleepout.

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