Some of the most common property questions the REIWA Information Service receives from the WA public are around breaking a rental lease and the process that is involved.
The method for terminating your lease is determined by what kind of lease you have.
Terminating a periodic lease
If you have a periodic lease, then terminating your lease agreement is straightforward. All you need to do is provide 21 days’ notice in writing to your property manager or landlord. Your lease will then end in 21 days.
Of course, if you are sending the notice by post, it’s best to add six working days extra to the notice period to account for delivery times, and if sending by email, you should follow up with the property manager to confirm they have received the email and are aware of your intent to end the lease.
Terminating a fixed-term lease
Terminating a lease becomes significantly more complicated if you are on a fixed-term lease, as there is no automatic right of termination. In order to break a fixed-term lease, you need to seek the owner’s permission (via your property manager if the accommodation is professionally managed).
In this instance, the owner will often agree to a termination at a point in time when an alternative tenant commences a new lease. In other words, the owner is looking for a smooth swap, minimum fuss and limited costs incurred.
The Residential Tenancy Agreement is a legal contract and the owner is entitled to seek an outcome where their financial position is no worse off as a result of a tenant breaking their tenancy agreement. Subsequently, the owner is entitled to claim compensation for any financial loss incurred as a direct result of the breach.
If a replacement tenant has not been found by the time you move out, you are liable to continue paying rent until a new tenant has been found or the original end date of your fixed-term lease expires. In addition, as is the case at the end of every lease, the property manager will conduct a final inspection and compare the condition of the property to the original Property Condition Report.
If a tenant has been found, but the amount they have negotiated to pay per week is less than what you are currently paying, you may be required to pay the difference up until the point your original lease would have concluded.
Discuss with the managing agent
Walking out of the lease agreement does not terminate your obligations – the owner is still entitled to claim compensation.
Where possible, my advice is to avoid breaking your lease. Try to arrange the original lease to a time frame that suits your circumstances.
If you are in a situation where you do need to break the lease, speak to the property manager early about what costs you are likely to be liable for. The sooner you let the property manager know of your plans, the sooner they can speak to the owner and start searching for a replacement tenant.
“This article was originally published on reiwa.com. You can find the original article here