Breaking Lease with Ray White

Lchartparker on 09/04/2016 - 11:35

Hi all,

We're currently renting but we looking to buy our first home. We think we've found one suitable for us, but the vendor wants a very short settlement. Our lease isn't up until September which would mean we'd have to break it. I'm aware that we're responsible for advertising costs and the letting fee, plus the rental amount until a suitable renter is found, but I can'd find any ballpark information on the advertising costs/letting fee with Ray White.

Apparently breaking a lease can also affect your credit rating?

Any and all advice/insults welcome!

Home & Garden

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Comments

  • airzone on 09/04/2016 - 11:43

    Call them up.

    Especially if you have been there for a while, it's possible that the market rent will be quite a bit higher than what you're paying now.. And in which case, they probably won't cry too much (which is what happened to me). Mind you, that was 10 years ago and the market rent rates had doubled since I took the lease out 3 years prior.. I should clarify - the owner was happy to break lease with me, and there was no cost to me…

    • chartparker on 09/04/2016 - 11:58

      We've only been here for 7 months or so. We were taking our time with finding a home, thinking it would take us 12 months, but this one seems perfect for us. Not sure if it's a good idea yet to let the agent know we're looking to move before we're set on it?

        • chartparker on 09/04/2016 - 19:18

          I think you're right, asking it as a hypothetical is the best way to go without being too specific.

  • holdenmg on 09/04/2016 - 11:52
    +3

    Just running this idea out there…

    If you stay on at the Rental until September, does the lease then go to a month to month lease from September?

    Could you partly furnish and AirBNB.com the property you are buying until such time that you are ready to actually move there?

    You would being in some AirBNB income and it would you allow you to move in on your own terms when you have arranged removalists and you have time free to do so.

    • chartparker on 09/04/2016 - 12:00

      I like your thinking, but I think there's a clause in our contract agreement that specifically prohibits subletting without approval from the owner. Our owner lives in China, which means basically ANY correspondence with him/her is via email and takes weeks to get a reply. Took them 3 weeks to approve blinds for the living room (brand new house) and it's been over 3 weeks for them to approve reimbursing us for emergency locksmith.

      • holdenmg on 09/04/2016 - 12:03
        +1

        No, I'm saying AirBNB the property you are buying, not the rental.

        • chartparker on 09/04/2016 - 12:21
          +1

          Ohhhh…. gotcha! That's not a bad idea. Not sure of the risks though… if we don't keep it full we'll probably struggle with repayments, but I'll look into it. Doubt the wife will go for it though - she's super risk-averse

        • holdenmg on 09/04/2016 - 12:32

          Well, you need to look at maximum benefit to you and minimum downside.

          Have a look at the Suburb your property is in on https://www.airbnb.com.au/ and you will get some idea of how properties are listed and what people are asking.

          Anyway, it is a sort of hybrid solution that may work…

  • teardrops21 on 09/04/2016 - 17:12
    +1

    Here are done ball park figures, but i would advise to to call your agent and find out exactly.
    Advertising is usally $100—$200

    Letting fee is around 4.4% of annual rent. However it should only be liable for this on a pro rata basis of the amount of lease still remaining.

    Of course you would be liable for any rent until the property is re-leased

    • chartparker on 09/04/2016 - 19:19

      Many thanks! I had a Google and it looks like someone else was in the same scenario. Apparently with Ray white it's generally 1 week rent for the exit fee and $99 advertising costs.

  • SnoozeAndLose on 09/04/2016 - 19:42
    +1

    TO break the lease you will need to pay the letting fee (110% of the weekly lease rate) + lease preparation fee about $33 + the number of weeks the house got emptied.

    If you tend to go this way you better make sure that all repair has been done and the house clean so that the agent can show the new tenant prior you leave, at the result you save some money.

    • chartparker on 09/04/2016 - 23:41

      The house is pretty much spotless and no damage, but you did just remind of a clause in the lease that mentions that I need to get professional carpet cleaning done prior to vacating the premises. Thanks!

  • xssive on 14/04/2016 - 21:19

    Hi

    Iam a Sydney based real estate agent. If you want to discuss with me, pm me your mobile and I'll call you with advice.

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