Break Lease (Re-letting cost not stated in contract)

nnaa8287 on 27/04/2021 - 18:36

I am breaking the lease in 8th month. Below is the clause per agreement

  1. Lease break - Breach of Fixed term
    In the event that the Tenant needs to vacate the premises prior to the expiry of this Agreement [and prior to the Diplomatic Clause coming into effect], the Tenant agrees to immediately advise the agent in writing and pay the re-letting costs as follows:
    (a) pro rata leasing fee (regardless of who found the tenant)
    (b) all rental payable up to the commencement of any new tenancy or up to the expiry date of the current lease, whichever comes first. Rent must continue to be paid one month in advance as per this lease agreement.
    (c) any advertising incurred

It doesn’t state any re-letting cost or advertising cost. Upong informing the agent, she asked for 2 weeks rent as re-letting fee + gst and 289 for advertising cost. Can I challenge/negotiate these costs as the values were not stated? Can i negotiate as low as 1 day rent cost?

Home & Garden

Comments

  • Ocker on 27/04/2021 - 18:46
    +4

    Dream on!

    • SF3 on 27/04/2021 - 19:54

      You got to give OP credit for posting to OzTryingItOn.. oh wait…

  • tsunamisurfer on 27/04/2021 - 18:46
    +6

    I am breaking the lease in 8th month.

    I am assuming you mean 8th Month of a 12 Month lease.

    Can I challenge/negotiate these costs as the values were not stated?

    Those costs are not stated so that the rental agreement doesn't have to change every time fees change. That is industry standard.

    Yes you can try to negotiate, you will likely not be successful as they have the legal legs to stand on.

    Upong informing the agent, she asked for 2 weeks rent as re-letting fee + gst and 289 for advertising cost.

    This is actually the LEAST of your concerns. This….

    (b) all rental payable up to the commencement of any new tenancy or up to the expiry date of the current lease, whichever comes first. Rent must continue to be paid one month in advance as per this lease agreement.

    …is your main concern if a replacement tenant cannot be found in this 4 months.

    You are in Melbourne which is experiencing increasing vacancy rates.

    • nnaa8287 on 27/04/2021 - 18:56
      -3
      • -This is actually the LEAST of your concerns.

      Why is this a least concern? I will be paying the money anyway but prorated? Should i ask for a receipt that landlord has paid his share?

      • tsunamisurfer on 27/04/2021 - 19:01
        +9

        What do you mean by pro-rata'd?

        What do you mean by landlord paying his share?

        Clause (b) stipulates you will have to pay rent (per your lease) until a new tenant is found to replace you or the end of the lease.

        Presumably this means you will have to pay the rent plus the cost of whatever accommodation you are moving to.

        Potentially 4 months of rent for not living there outweighs this 2 weeks plus costs that you are concerned over.

        • dizzle on 27/04/2021 - 19:09
          +8

          This. It also has the potential that if they have to lower the rent to get a new tenant in (which is likely right now), that the difference between the new rent and the old rent is payable by OP for the 4 months.

          I admit it's not likely they would go to the trouble of doing this, but the potential is there.

        • nnaa8287 on 27/04/2021 - 20:33

          Re-letting and advert cost will be prorated.

          I read somewhere that if matter is taken to Vcat/court, max compensation will be 1 month rent for every 12 months. Am i misreading it?

          • dizzle on 27/04/2021 - 20:51

            @nnaa8287: Seems you are right (for VIC) about the letting/advertsing fee. And it even says that in your post

            However I can't see anything saying max compensation.

            This is straight from Tenants association for VIC:

            The costs you could be liable for include:
            A reletting fee (usually one or two weeks’ rent). This must be based on the fee that the agent charged the landlord so it is a good idea to ask for a copy of the invoice
            Reasonable advertising costs
            Rent until new tenants move in or until the end of the fixed term (whichever happens first).

            And looking back at the text from your lease seems to agree

            (b) all rental payable up to the commencement of any new tenancy or up to the expiry date of the current lease, whichever comes first.

  • SnoozeAndLose on 27/04/2021 - 18:46

    What is any advertising Incurred mean? I believe it mean advertising fee but I would argue this as owner only need to pay 1 week rent + GST on signing new lease, never pay extra for advertising fee.

    Different agent/state may be different.

    • dizzle on 27/04/2021 - 19:11
      +2

      Advertising fees would cover their own website as well as third party rental sites like Realestatedotcom.

      The only way you can really get around this, is by finding a friend to take over the lease. They've got to advertsie the vacency somehow.

      • SnoozeAndLose on 27/04/2021 - 20:20

        As a landlord 1 only need to pay 1 week rent plus GST or advertising fee if I no longer want to rent out after advertise. Never need to pay both

        • nnaa8287 on 27/04/2021 - 20:31

          But in my lease it states both. So guess have to pay both.

          • SnoozeAndLose on 27/04/2021 - 20:51
            -2

            @nnaa8287: May be the weekly rent is too low then I believe both need to be paid.

            Question is does owner need to pay? If it isn't the cost for owner why you would need to pay.

            • Jolakot on 28/04/2021 - 02:01
              +1

              @SnoozeAndLose: Because they're breaking the lease early, and as such need to compensate them for the costs involved.

  • orangetrain on 27/04/2021 - 19:01

    Be sure to read leases next time and remember, you can negotiate. Mine says 2/4 weeks depending on time left. Ask for it

  • Almost Banned on 27/04/2021 - 19:13
    +2

    Your lease specified the costs you need to bear as 're-letting costs'.
    Those costs are leasing fee, rent, and advertising.
    If it is not one of those costs, then you don't need to pay. If it is one of those costs, you do.

  • dizzle on 27/04/2021 - 19:14
    +5

    I'd suggest 2 weeks + advertising is quite fair considering the current market.

  • nnaa8287 on 27/04/2021 - 20:07

    My 8th month finishes on 25th. So if agent is unable to find any new tenant for another month, can i continue living in the property considering that Ill have to pay the rent until they find new tenant?

    Can i say that i can vacate the premises with 2-3 days notice?

    • dizzle on 27/04/2021 - 20:32
      +1

      Not sure on legal, but I assume once you hand in the notice to vacate, that date becomes firm. You may be able to discuss with the real estate, but since you're screwing them around I wouldn't expect much leniency.

      However even if they do allow:
      Are you willing to put up with people going through and viewing on short notice? Part of that 2 weeks noticeis so they can organise someone within those two weeks. If someone is living there it will probably take longer.

    • reactor-au on 28/04/2021 - 08:24
      +1

      Yes you can stay until they find a new tenant. Once they find a new tenant they need to prepare a new lease agreement for that person and all the usual stuff.
      Most lease agreement say you have only actually vacated once you have returned all the keys to the agent as well.

  • Seraphin7 on 27/04/2021 - 20:28
    +1

    Can I challenge/negotiate these costs as the values were not stated? Can i negotiate as low as 1 day rent cost?

    As ever, you can challenge/negotiate whatever you like. Whether or not that will result in a successful outcome is an entirely different question.

  • bobbified on 27/04/2021 - 21:00
    +2

    It doesn’t state any re-letting cost or advertising cost.

    Am i missing something here? In the conditions, isn't point (a) the re-letting cost and point (c) the advertising cost?

  • trustnoone on 27/04/2021 - 21:07

    I'm not a lawyer, nor am I your lawyer, but two thoughts come to mind reading the above:

    1. You can try to find another tenant yourself? It states you have to pay the lease fee even if you find your own so that means you're allowed to find your own? I think most need to be at a point where they have to give a good reason to refuse the prospective tenant? I would imagine that way you're not out of advertising costs and minimal rent. Can even use that extra cash to sweeten the pot for prospective tenant I think?

    2. Also your lease has this:

    Rent must continue to be paid one month in advance as per this lease agreement.

    I think your in Vic, which I thought was:

    If your rent is $350 or less per week the most rent you can be asked to pay in advance is one month. But if your tenancy agreement says your rent is paid weekly, the most you can be asked to pay in advance is 2 weeks.
    https://tenantsvic.org.au/advice/starting-your-tenancy/start…

    So I'm guessing your rent is under $350, otherwise asking a month of advance rent may be illegal? (again not a lawyer so could be wrong).

    • stirlo on 28/04/2021 - 11:18
      -1

      So I'm guessing your rent is under $350, otherwise asking a month of advance rent may be illegal?

      Not at all. Read it again. If the rent is under $350 the most you can be asked to pay in advance is 1 month. If above $350 they can ask for anything… As it is this is set out in the lease where the OPs says 1 month in advance, so that's what they have to pay.

  • chartparker on 27/04/2021 - 21:15

    EDIT: Disregard I didn't read properly

    • nnaa8287 on 27/04/2021 - 21:29

      So I'm guessing your rent is under $350, otherwise asking a month of advance rent may be illegal? (again not a lawyer so could be wrong).

      Rent is $535

      • iCandy on 28/04/2021 - 09:00

        $535 a week or a month?

        • Quantumcat on 28/04/2021 - 09:28
          +2

          Unless you're living in a country town in the middle of nowhere, it's $535/week

      • stirlo on 28/04/2021 - 11:22
        -1

        As per my comment above this is irrelevant. Your lease says pay 1 month in advance, you pay one month in advance. As your rent is above $350 they could have asked you to pay 3 months in advance if they wanted…

  • Jolakot on 28/04/2021 - 02:02

    If you're in VIC, then both the advertising fee and reletting fee are pro-rata

  • MontyMacaw on 28/04/2021 - 11:40
    -1

    Whichever way you go you will get screwed, that’s a given. Playing devil’s advocate however the rental was based presumably on a 12 month term. You are locked into that unless the agent can find somebody to take over the property. It is in your interests to help them get a new tenant so having the place looking its best and helping the agent in any way is your best route rather than being a whining Willie. You need to build a better relationship with your agent now more than ever as you both want the same thing. They will need to advertise and work extra to get another tenant (on your behalf) if you don’t want to pay the rent until the end of the lease. Think on that a bit and get proactive rather than take the opposition view.

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