How do I end my tenancy agreement?
You may be considering ending your tenancy for a few reasons: if you don’t fit within the COVID-19 'impacted tenant' criteria; haven’t been able to negotiate a rent reduction and cannot afford to stay; or negotiations are not going well and you don’t want to get into arrears or further into arrears; or you just need to move for other reasons.
The information below covers some things you should be aware of.
If you are facing threat of eviction, see also COVID-19 Guide: Eviction.
- How else can I end my tenancy agreement?
Ending your tenancy outside of a fixed term agreement
If you are in a periodic agreement (i.e. an ongoing agreement) you can end your tenancy by giving a minimum of 21 days notice, and leaving by the vacate date in your notice.
It is worth getting in touch with the landlord or agent to explain your current financial or health circumstances. You might be able to negotiate and agree on a shorter period of notice. If you do come to an agreement with the landlord make sure you have this confirmed in writing. The landlord is not required to consider this request, but it’s definitely worth a try. See also Factsheet 9: You want to leave.
Breaking a fixed term lease early
If you are in a fixed-term agreement (i.e. your fixed-term tenancy agreement has not yet expired) you may have to pay a break fee or compensation to the landlord for breaking the tenancy agreement early. As mentioned above, it is worth writing to the landlord to let them know why you are wanting to break the lease early and asking them to consider waiving any applicable break free or compensation claim. See also Factsheet 16: Ending a fixed-term tenancy early.
If you have somewhere else you can stay, weigh up waiting for a response from the landlord or a possible application to the NCAT) against any notice and penalties that might apply. Make sure to ask the landlord to respond within a reasonably short time frame as waiting for weeks to get a response or determination could end up costing you just the same as paying the break fee.
If you have an older agreement, you might find it useful to refer the agent or landlord to the newly introduced structure for break fees for agreements entered into on or after 23 March 2020. At the moment the new structure does not apply for agreements entered into before 23 March, but the agent or landlord may consider this a good compromise.
2 week cap on break fee for 'impacted tenants' where landlord won't engage in rent reduction negotiations
Where rent reduction negotiations have failed, COVID-19 'impacted tenants are able to end their fixed term tenancy early with reduced penalty. You are able to apply to Tribunal to end your tenancy early where:
- you have requested the landlord engage in formal rent reduction negotiations and they fail to respond within 7 days, or refuse to participate or after agreeing subsequently fail to participate in a formal rent reduction negotiation process, or
- the landlord doesn't respond to a notice from Fair Trading to engage in a formal rent reduction negotiation process within 7 days, or fails to or stops participating in the formal process, or
- 'good faith' negotiations fail because the rent reduction that the landlord can agree to are not affordable for you, or because of financial hardship you are likely to face due to arrears you have already accumulated and/or any further arrears you are likely to accrue if the tenancy is not ended
In this situation you can only be required to pay up to a maximum of 2 weeks rent in compensation. The Tribunal also has discretion not to impose any fee at all.
- Can I end my tenancy due to hardship?
You are also able to apply to the NCAT to end a fixed-term agreement early if you can show the NCAT that continuing the tenancy would cause undue hardship.
If you are in a fixed term agreement, you can apply to NCAT for a termination order on the basis of hardship under s104 of the Residential Tenancies Act 2010 (NSW). NCAT may grant such an order if satisfied that, in the special circumstances of the case, you as the tenant would suffer undue hardship if the tenancy agreement was not terminated. NCAT may also order the you to pay compensation to the landlord for the landlord’s loss of tenancy (but the amount cannot exceed the applicable break fee).
If you are a 'COVID-19 impacted tenant' and rent reduction negotiations have failed you can end your tenancy early on this basis under s228C of the Residential Tenancies Act 2010 (NSW), and the break fee will be a maximum of 2 weeks rent. See 'How do I end my tenancy agreement' above.
However, keep in mind wait times for hearings at the Tribunal may be up to 6 - 8 weeks, unless you are able to secure an urgent hearing (see COVID-19 Guide: Tribunal).
- Can I transfer my tenancy?
If you want to move out before the end of your tenancy agreement and you find someone who wants to take over your lease, you may be able to transfer your tenancy to them.
You will need written consent from your landlord, and it is good idea to have a draft transfer document that specifies by name the proposed tenant and is signed by both parties. You can find a template document here: https://www.tenants.org.au/factsheet-18-transfer-and-sub-letting
If you successfully transfer your tenancy, this means your legal liability under the agreement has ended.
COVID-19 Guide: Moving house and distancing rules
Factsheet 18: Transfer and sub-letting