Tennant wants to break lease

[akyboy]

G'day,

I posted a thread earlier, but didn't the information that I was after, so I have decided to start another thread with specific questions (I hope you don't mind).

Background:
------------
Current tenant has not paid rent and has indicated that they are having difficulties and want to break the current lease. The lease is only 2 months old and has a further 10 months left. Bond has been supplied and registered. No rent has been received since they moved in.

1. Is the tenant allowed to break this lease?

2. If so, what am I technically allowed to claim? Obviously I want the rent to be update to date before they move out. But I'm concerned with whether the tenant is liable to pay for vacancy periods and advertising costs involved to find a new tenant.

3. Is the tenant allowed to transfer the lease to another person?

4. What do I do if the tenant doesn't pay any rent prior to moving out?

Thank you!

akyboy

[duncan_m]

G'day,

I posted a thread earlier, but didn't the information that I was after, so I have decided to start another thread with specific questions (I hope you don't mind).

Background:
------------
Current tenant has not paid rent and has indicated that they are having difficulties and want to break the current lease. The lease is only 2 months old and has a further 10 months left. Bond has been supplied and registered. No rent has been received since they moved in.

1. Is the tenant allowed to break this lease?

2. If so, what am I technically allowed to claim? Obviously I want the rent to be update to date before they move out. But I'm concerned with whether the tenant is liable to pay for vacancy periods and advertising costs involved to find a new tenant.

3. Is the tenant allowed to transfer the lease to another person?

4. What do I do if the tenant doesn't pay any rent prior to moving out?

Thank you!

akyboy

Akyboy,

You need to tell us what state you are in.. what you can and can't do is generally defined in the Residential Tenancies Act in your State.

[akyboy]

Sorry! I'm in NSW!

akyboy

[rossv]

hi akyboy,

1st you need to read this .. http://www.legislation.nsw.gov.au/fullhtml/inforce/act+26+1987+FIRST+0+N

but to generalise i would suggest letting the tenant break the lease .... they are liable for all rent until the ip is re leased plus the advertising costs plus from memory the agents reletting fee.

i have found it is always better to let them go, if they don't want to be there they are always going to be a problem ....

good luck

rossv

[quoll]

Get rid of them, advertise and get a new tenant. The current tenant is liable for the advertising, the rent, and the agents fees for finding new tenant unless they can supply a tenant for you.

You don't have to accept their offerings in the way of tenants, you can still be picky. So get a good tenant.

The only hassle is getting the cash out of them that is over and above the bond. But $10 per week isn't that bad.

Cheers
quoll

[akyboy]

Cheers for the suggestions.

Quoll,

Are you suggesting that allowing the tenant to pay $10 per week to pay off the amount owing above the bond value?

Akyboy

[kissfan]

Hi akyboy.

Agree with all the above.

RossV's comments especially make sense.

Get the current tenant out and find someone that will start paying the rent. Then try and recoup what you are owed. I say try because from what I have read (thankfully haven't experienced) sometimes it is harder than it seems. Better to have the current tenant on their way as the longer they stay, the more rent you are losing (and trying to chase back).

Regards
Marty

[JoannaK]

G'day,

I posted a thread earlier, but didn't the information that I was after, so I have decided to start another thread with specific questions (I hope you don't mind).

Background:
------------
Current tenant has not paid rent and has indicated that they are having difficulties and want to break the current lease. The lease is only 2 months old and has a further 10 months left. Bond has been supplied and registered. No rent has been received since they moved in.

1. Is the tenant allowed to break this lease?

Yes, however, they must do certain things to compensate you.


2. If so, what am I technically allowed to claim? Obviously I want the rent to be update to date before they move out. But I'm concerned with whether the tenant is liable to pay for vacancy periods and advertising costs involved to find a new tenant.

You are allowed to claim all rent up until the date a new tenant commences paying rent. If the new tenant pays a lesser rent then the old tenant is also responsible for the shortfall up until the date the broken lease expires.

The tenant is responsible for your letting costs, lease prep fees and advertising. These costs are calculated depending on how long the old tenant has been in the lease for. If the tenant breaks the lease in the first quarter of the lease he is responsible for the entire amount of all costs.


3. Is the tenant allowed to transfer the lease to another person?

Not really - I don't recall any clauses in the lease that allow this. It is prudent that any new tenant be analysed and screened by you or your property manager in the normal manner. The old tenant can, however, advertise and show prospective tenants on his own behalf, then refer the incoming tenants to you. This will then save the old tenant the letting fee he's responsible for.


4. What do I do if the tenant doesn't pay any rent prior to moving out?

Thank you!

akyboy

The old tenant is still bound by the terms and conditions of the lease and rent is an essential and fundamental term of this lease. He must continue to pay his rent. If he doesnt you are entitled to claim his bond, then pursue him for the balance through the residential tenancies tribunal. This will give you an order against the tenant, which will then allow you to proceed to garnish his wages.

I hope this helps.

[akyboy]

Kissfan and JoannaK thanks for your reply. I really appreciate it :)

I shall keep this thread updated with proceedings. I'm currently looking for a new PM (as per the new thread in the PM forum).

akyboy

[crest133]

Hi Akyboy
Unless the tenant's financial situation took a sudden downturn just after moving in, it usually means the PM has made poor tenant selection.
Tenants like yours are usually hanging onto their cash right now to have the bond and rent in advance to move into a new place, and they've probably already been looking. You can work with them or flog them, but better to work with them if possible in order to have some co-operation, get the max money you can as they leave, (get them to sign over the bond to you) while you are seeking new tenants. Discuss their needs openly with them, and tell them yours. That way, they're most likely to leave the place reasonably clean without backlash damage or hidden prawns, and enable you to show prospective new tenants through before the outgoing tenants vacate. This usually works better than Tribunal.
Good luck
cheers
crest133