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Ask RiotACT: Break of lease advice

By Tplanner23 - 31 August 2016 7

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Hi All.

I recently provided my real estate agent with a Notice to Vacate – break lease form (submitted on the 04/08/16). The real estate has held three open houses, although the owners have not accepted new tenants yet. If they don’t find new tenants within the next week then we will have to pay another fortnights rent (part of the break lease form was accepting to pay rent until a new tenant moves in or the tenancy agreement expires, we still have 6 months to go on the lease). My room mate and I only moved out as I took up a full time job offer in Sydney and had to relocate. I’m aware that we agreed to the above conditions although I feel the owners/real estate don’t have an incentive to find new tenants because we are still paying rent. I contacted the tenants union who advised once we hand back the keys and are out of the property we don’t have to pay rent anymore, although may be up for compensation to cover the costs the owners lost whilst not having a tenant in the property. I told this to the real estate agent and they said this was incorrect advice. Is there anything I can do if the owners/real estate are taking to long? Considering they’ve already had over 3 weeks to find new tenants and haven’t done so yet. I’m paying double rent until they find new tenants (My place in Sydney and the property in Canberra) and I can’t financially do this for much longer. Does anyone know a lawyer I can talk to or any advice would be appreciated.

What’s Your opinion?


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7 Responses to
Ask RiotACT: Break of lease advice
1
Peter Smith 11:34 am
31 Aug 16
#

I’d suggest reading through some of the archive articles (comments) on RiotACT which deal with a similar situation / question.

http://the-riotact.com/end-a-rental-lease-early-in-canberra/105536
http://the-riotact.com/breaking-a-lease-in-canberra-advice-please/70723

In terms of lawyer recommendations, I have used Meyer Vandenberg a few times for property related items. They were very good.

2
pink little birdie 11:49 am
31 Aug 16
#

All the leases we have had have had a page about breaking lease. You should check that. I’m pretty sure that the maximum that you can be charged is a months rent after the vacating day. Seems like they are waiting to get maximum fees off you.
Depending on the area right now most places have had 1 open house and get tenants after that. (We got ours after 1st open home 4 weeks ago). So if the open homes were well attended it would have been rented.

3
devils_advocate 12:14 pm
31 Aug 16
#

Both the pieces of advice you got were correct, and they produce the same result.
When you signed a fixed-term (e.g. 12 month lease) you contracted to pay out the full term of the lease. The full liability – that is, 12 month’s rent – is by convention paid in instalments, that is monthly rent.
‘Breaking’ the lease is essentially breaking the contract. When a person breaks a contract, they are liable to compensate the other party for any losses they sustained as a result of that. however, the other party is also required to mitigate (i.e. minimise, contain) their losses as much as possible (in this case, by making reasonable efforts to find a new tenant).
Even if/when they do find a new tenant, that doesn’t automatically let the previous tenant off the hook. If the best rent they could get is less than what the previous tenant contracted for, they could be liable to make up the difference.
But in essence, you agreed with the lessor to rent the place and pay a particular amount of money for a specific amount of time. That agreement was intended to provide certainty of accommodation for you, and certainty of income for the lessor. If you want to walk away from the agreement, the lessor rightly can expect to be compensated for reasonable losses.

4
Maya123 12:38 pm
31 Aug 16
#

Three weeks is not an unreasonable time not to have found a new tenant. When I had a rental house it often took me longer to find a new tenant than that. You can’t just rent to anyone. They need to be able to pay the rent for starters.

5
greenbamboo 9:47 am
02 Sep 16
#

Meyer Vandenberg. That’s the person u need!

6
Madam Cholet 8:58 am
20 Jun 17
#

The Tenants Union website has fact sheets about this type of situation. Essentially you are liable for costs – I think up to 25 weeks or the remainder of the lease, whichever is less, plus the costs of re-letting, which you could argue would be inevitable anyway, But the landlord cannot be lazy either and just keep taking your rent and not do everything they should to advertise the property.

Have you seen it being advertised? Is the rent much higher? That would be a reason it wasn’t being rented, and would go against you getting new tenants in. Also, if they do rent it out but say tenants can’t move in for a month, I think that is just something the landlord should suck up – properties are empty for periods of time.

If you do think or better still know the agency and the landlord are pulling a fast one, I’d just mention the words ‘tribunal’ or ‘ACAT’ and you might get some action. It doesn’t cost much to lodge at an ACAT. It may be the best money you spend if they are up to no good.

7
Maya123 11:38 am
20 Jun 17
#

Madam Cholet said :

The Tenants Union website has fact sheets about this type of situation. Essentially you are liable for costs – I think up to 25 weeks or the remainder of the lease, whichever is less, plus the costs of re-letting, which you could argue would be inevitable anyway, But the landlord cannot be lazy either and just keep taking your rent and not do everything they should to advertise the property.

Have you seen it being advertised? Is the rent much higher? That would be a reason it wasn’t being rented, and would go against you getting new tenants in. Also, if they do rent it out but say tenants can’t move in for a month, I think that is just something the landlord should suck up – properties are empty for periods of time.

If you do think or better still know the agency and the landlord are pulling a fast one, I’d just mention the words ‘tribunal’ or ‘ACAT’ and you might get some action. It doesn’t cost much to lodge at an ACAT. It may be the best money you spend if they are up to no good.

I agree with most of what you write, except “plus the costs of re-letting, which you could argue would be inevitable anyway”

This could be an extra cost of re-letting that might not have occurred for months at a minimum, so it is extra. This would be affected by how many months of the lease remained though. A month is different to ten months.

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