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Tenant wishing to end lease halfway through with no break clause.

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Author Topic: Tenant wishing to end lease halfway through with no break clause.  (Read 22238 times)
Guest
« on: January 14, 2012, 02:31:41 AM »

Hi everyone,

I have a tenant who, after 4 months, would like to end their 12 month lease and move out after 6 months.  They signed the 12 month lease with no break clause.

As a landlord, if I agree to this, can I do so on condition that they pay all fees associated with moving out, finding a new tenant, covering all admin costs with drawing up a new lease, new inventory etc, cleaning & repairs and any fees to cover a possible void period?  i.e. Council tax, lost rent etc.  Anything else I have forgotten to mention, I'd appreciate any advice.

Many thanks!!!
Guest
« Reply #1 on: January 14, 2012, 10:54:00 AM »

Hello Candy,

As there is no break clause, early termination is by mutual agreement.  It is perfectly legal for you to say that your agreement comes at a money price.

However, if I were the tenant there would be no way I'd accept the kind of deal you're describing.  Many of the costs you're describing are simply being incurred early, rather than additionally: I.e you'd be having admin costs of new tenant at the end of the existing tenancy anyway.  Other costs are un-defined at the point of the deal: Just how long is the void period going to be?  And other costs are out of my control: If I'm paying for your void period, just how much incentive have you got to market your property efficiently.

Can I suggest another way.  Just think about these things and decide how much you think they are worth.  Put a simple deal to the tenants which says "If you want to terminate the agreement early that's OK, if you pay an early release fee of x".  It becomes a very simple decision for the tenant.

Yes, this means that if you are unlucky then x won't cover your costs.  Or you could get lucky and have a few quid over.  But you're in business now, and no business is able to pass all of its risks onto its customers.
Guest
« Reply #2 on: January 14, 2012, 01:45:14 PM »

Personally, if a tenant wants/needs to move out before the period of the tenancy is up, with or without a break clause, then I don't believe in trying to hold them there against their will.  This is a risk that goes with property letting.

I would let them go with something like a month's written notice, and would make clear that during that time I expect to be allowed entry to show prospective new tenants around.  I would also say that I would like it left clean and tidy, as cleaning and repairs which go beyond normal wear and tear can be deducted from the deposit.

The outgoing tenant has to pay their own removal costs, but that only includes clearing the property of their own belongings really.  The costs you indicate, such as finding a new tenant, and setting up a new lease are part of setting up a new tenancy, void period etc. are for landlords to expect to bear, so in my opinion it is NOT reasonable to expect your outgoing tenant to pay these.
Guest
« Reply #3 on: January 15, 2012, 01:42:46 PM »

Not an expert on this, but if the tenant signs a 12 month agreement with no break clause, should they not be bound by law to pay rent for the full 12 months?

If tenant leaves after 6 months, then that leaves 6 months unpaid. As I understand it, the tenant doesn't have to pay all of this if you manage to find a tenant before the 12 months are up, so the tenant would only pay up to when the property is re-let.

I understand the moral issue however, so maybe point out the above, that she is legally bound, but will come to sort of an agreement. As Jeremy states, "If you want to terminate the agreement early that's OK, if you pay an early release fee of x".  It becomes a very simple decision for the tenant."

The above is my understanding, feel free to correct if wrong.
Guest
« Reply #4 on: March 17, 2012, 09:43:53 PM »

same thing happened to me, my tennant wanted to leave tennancy early i took legal advice and was told he can leave but must carry on paying rent untill you find a new tennant and sign a new agrement,but u must actively seek for a new tennant,,,i found a new tennant in three weeks he was happy and over payed me rent to say thanks as we were both on good terms,,he was happy and i was ok with it ..hope that helps cheers john
 
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