Residential Tenancy Agreements: The Bitter End

Date: Jan 01, 2014
Document Type: Article

A number of different circumstances can give rise to the end of a residential tenancy agreement; and this piece will outline the general ways in which your rental agreement can come to an end.

Termination by the Tenant 

At the end of the lease period

A tenant wishing to end the agreement at the end of the fixed lease period must generally provide 14 days notice to the landlord in writing on, or before the last day of the lease period. Failing to do this, the rental agreement becomes a periodic one, requiring 21 days notice to the landlord. In the case of a share house, an individual tenant can separately give their 21 days notice to end their lease. 

Before the end of the fixed period

In the case of financial hardship to the tenant, they can apply to the relevant tenancy tribunal for an order to end the agreement. This may come with the requirement of paying the landlord compensation for lost income from rent.

A tenant ending their agreement early without an order, may be liable to pay for the costs of breaking the agreement, such as the landlord's lost income. However, the landlord must try to find a replacement tenant as soon as possible. The break fee for ending the tenancy early can be six weeks rent for the first half of the fixed term, and four weeks thereafter such as the case in NSW for example.

However, if the tenant provides the statutory notice, the tenant is not obliged to pay any compensation if: 

·         the tenant has accepted an offer of social housing;

·         the tenant is going into aged care;

·         the landlord gives their first notice of intending to sell the house;

·         the tenant has been excluded from the premises by virtue of an Apprehended Violence Order.

For tenancies lasting more than two years where the landlord has issued a rent increase, the tenant does not need to pay compensation if they give 21 days’ notice in certain jurisdictions.

If the landlord breaches the agreement

The tenant has two options; they can apply directly to the relevant tribunal or provide the landlord with 14 days notice in a letter that also specifies the breaches. The tribunal can provide the tenant with an order allowing them to end the agreement.

Termination by the Landlord 

At the end of the fixed term

The landlord must provide the tenant with 30 days notice that they wish to terminate the agreement at the end of the fixed lease period. Failure to provide this notice means that the tenancy becomes a periodic one, requiring 90 days notice to terminate depending on the jurisdiction. 

During a periodical agreement

Provided that the 90 days notice is given, the landlord is under no obligation to give a reason. The tribunal may terminate the agreement, unless the notice of termination was given in response to the tenant enforcing their legal rights against the landlord.

Where the tenant gives possession before the 90 days have ceased, the liability to pay rent also ceases. The tenant does not need to give notice in this period.

If the tenant has breached the agreement

If a tenant breaches the agreement, leading to the landlord's decision to end the agreement, 14 days written notice specifying the breaches must be given.

With more and more of us being forced to rent property, it's important to know what your rights and responsibilities are in the rental market. Don't get caught when terminating an agreement!

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