Lease breaks and how they can save you money
Lease breaks happen for any number of reasons â€“ family illness, job transfers, relationship breakdowns.
It can be easy to feel panic if you have just been told that your tenant is breaking their lease however itâ€™s very similar to having a normal vacancy only you wonâ€™t have the fees to pay and there will be no gap between tenants. Â That said, there are a couple of things you need to know:
- The rent cannot increase until the current tenantâ€™s lease has expired. Â For eg, if your tenant signed a 12 month lease at $300 per week from 1 January 2016 and broke the lease in April, the rent must remain at $300 per week until 1 January 2017
- Property investorsÂ must be reasonable when considering rental applications as they also have an obligation to mitigate the tenantâ€™s losses.
- Tenants can apply to QCAT to have the lease agreement terminated due to reasons of hardship. Â This often means that the tenants do not have to pay any fees and are released from their legal obligations.
How can you protect yourself from losing money over a lease break?
The only way you can completely protect yourself from losses incurred in a lease break situation is to ensure you have a good landlord insurance policy like Terri Scheer or EBM Insurance.Â Need some info?Â Click on the button below to request aÂ brochure on what you can be covered for.