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Ending a tenancy early

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When a tenant and landlord sign a fixed term tenancy agreement (a lease), they are committing to the full term of that agreement.

This edition of the Letterbox focuses on ending a tenancy before the fixed term ends, including when circumstances change and the potential costs involved.
 

Answers to your questions on ending a tenancy early

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Q: How much notice does my tenant need to give me if they want to leave before the fixed term of the lease ends?

A: The amount of notice your tenant needs to give you to terminate the lease early depends on the circumstances.

Your tenant can give 14 days' written notice to end the agreement early if:

  • they have been offered and accepted social housing, or they are moving into an aged care facility
  • a final apprehended violence order (AVO) is in force which prohibits someone they were living with from having access to the premises
  • you have notified the tenant of your intention to sell the premises. This does not apply if the tenant was told the property would be sold before they signed the lease
  • you breached the lease

Your tenant can give you 21 days' notice if you have a fixed term lease of 2 years or more and you have given them a rent increase notice, or if their co-tenant passes away.

If the tenant wants to end the tenancy for some other reason, you are entitled to claim compensation from them for the early termination of the lease. The amount of compensation payable depends on whether the lease has a fixed break fee clause, and how much of the fixed term of the lease has expired.

You can find out more about breaking a lease early on our website.
 
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Q: I am moving interstate for my job and need to break my lease. My agent has told me that I must pay a 'break fee'. Is this correct?

A: There are potential costs involved if you break your lease early. Whether you pay a break fee amount or compensation is calculated in another way depends on the terms of your lease.

If your lease includes a break fee clause, then you will pay the break fee amount, which is:

  • 6 weeks' rent if you move out in the first half of the fixed term
  • 4 weeks' rent if you move out in the second half of the fixed term.

If your lease does not include a break fee clause (i.e. it has been crossed out from your lease), then you may need to pay compensation to your landlord, including loss of rent. The landlord or agent must take all reasonable steps to find a replacement tenant as soon as possible.

If you don't pay, or if you disagree with the amount, the landlord or agent will usually claim from your bond or apply to the NSW Civil and Administrative Tribunal (the Tribunal).
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Q: The landlord has breached our tenancy agreement by interfering with our right to reasonable peace and privacy. Am I able to break my lease?

A: If your landlord has breached the tenancy agreement and has not remedied the problem, you may be able to end your tenancy early without penalty. Bear in mind that the breach needs to be serious enough to justify the early termination of the tenancy.

You can give the landlord 14 days' notice that you are terminating the lease because of the landlord's breach, or you can apply to the Tribunal for an order terminating the lease. You will need to provide evidence at the Tribunal that the breach justifies ending the lease. The Tribunal can refuse to make an order if the landlord remedies the breach.

Alternatively, you can apply to the Tribunal for an order that the landlord fixes the breach or that they stop breaching the agreement. More information on resolving renting problems is available on our website.
 
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Q: I've been renting my house out for the last year and the tenant's fixed term of the lease is about to end. I want to move back into my property and need to serve my tenant a termination notice. What do I write in the termination notice, and can I send it by email?

A: If the fixed term of the lease is going to end and you want to move back in, you or your agent will need to give the tenant 30 days' written notice before the end of the fixed term.

In your termination notice, you need to specify a termination date that is on or after the end of the fixed term. The termination date cannot be before the end of the fixed term. Also, the notice needs to be properly addressed to the tenant and signed and dated by you or your agent.

Alternatively, you can use NSW Fair Trading's model termination notice which is available on our website.

You can send the notice by email, but only if you have obtained written consent from your tenant that a specified email address is to be used to serve that notice. Otherwise, the notice will need to be served by:

  • handing it to the tenant in person, or
  • handing it to somebody aged 16 or over at the tenant's residential or business address, or
  • personally putting it in the tenant's mailbox, in an envelope addressed to them, or
  • posting it to the tenant at the address they have specified for receiving notices.
Visit our website to find out more about serving notice, including information on how days are counted.
 
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Q: I have accepted social housing from Housing NSW. My landlord is charging me a break fee as I am in a fixed term agreement. Do I have any options to break the agreement without penalty?

A: Because you have accepted social housing, you can break your fixed term lease early without penalty by giving the landlord 14 days' written notice.

Visit our website for more information on other circumstances where a tenant can break a lease early.
 

Tenancy Tales from the complaint service

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A tenant received a termination notice as the landlord had sold the property and the buyer required vacant possession. The tenant found a new home and moved out before the end of the 30 day notice period. The tenant handed the keys back to their managing agent, but the agent didn't accept this and told the tenant they had to pay rent until the end of the notice period. The tenant lodged a complaint with Fair Trading.

A Fair Trading officer contacted the licensee of the agency and explained that once a landlord or their agent issues a termination notice, the tenant can then leave at any time without giving formal notice. The licensee accepted this and agreed to contact the tenant to let them know that no more rent was payable.

Visit our website for more information on giving a termination notice.
 

Is your apartment fire safe?

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If you own, live in or manage an apartment, we encourage you to make sure your building is fire safe.

Material that covers external walls, also known as cladding, can increase the intensity and speed a fire spreads if it's the wrong type or not installed correctly.

The NSW Government is working hard to address these fire safety risks and new laws have been introduced to ban unsafe building products in NSW.

If you think your building is at risk, take immediate action now:

  • Find out if your building has aluminium cladding
  • Check whether your building's fire safety statement is up-to-date
  • Ensure a fire safety professional has inspected any cladding
  • Take immediate action to make recommended changes.
More information on the action to take is available for owners and tenants and property managers on our website.
 

Need help?

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If you can't find an answer to your question, you're welcome to call us on 13 32 20.

If you have a problem with a tenant, landlord or agent that you can't resolve, remember you can lodge a complaint online to use our free tenancy and real estate complaint service.

The Tenants Advice and Advocacy Services provide assistance and advocacy to all tenants, particularly social housing tenants or the vulnerable. To find your nearest Tenants Advice and Advocacy Service, go to www.tenants.org.au or call 8117 3700.
 

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Upcoming events

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NSW Fair Trading offers free community education seminars across NSW.

Stay informed with Fair Trading's events and seminars on tenancy topics for real estate agents, self-managing landlords and tenants.

Events for self-managing landlords are available in Albury (21 March) and Chippendale (28 March).

Events for real estate agents are available in Castle Hill (14 March) and Coogee (29 March). 

Strata scheme information sessions for owners and tenants are available in Albury (21 March) and Chippendale (28 March); and for professionals in Chippendale (28 March).

Book now
 
fairtrading.nsw.gov.au