Getting out of fixed term lease
Question from Sengodi updated on 21st February 2018:
I'm breaking my fixed term lease and this has been agreed on by all parties. The agency is wanting the new tenants to sign up a new fixed term contract for one year and not until the end of my tenancy and they want them to pay a letting fee. This makes the property unattractive. Is this right - can they do it like that?
Our expert Steve Watson responded:
Whether you can get out of a fixed term tenancy may depend on what the tenancy agreement allows you to do. Sometimes the tenancy agreement will allow you to assign (transfer or hand over to another) the fixed term tenancy with the landlords’ consent, which they cannot unreasonably withhold.
In this situation, landlords can attach reasonable conditions to their consent, for example that the departing tenant will pay for or reimburse any reasonable expenses. In this situation, the landlord cannot unreasonably withhold their consent for you to assign the remaining portion of your fixed term tenancy to another acceptable tenant.
If the tenancy agreement states that you may not assign the tenancy then the landlord may agree to grant a new tenancy agreement with different terms and conditions. The landlord may also decide not to release you from the fixed term tenancy.
It is common for a landlord to require a departing tenant to pay for any advertising costs and to remain liable for rent up until the day before a new tenant takes over. In some situations a landlord may require
the existing tenant to find a suitable replacement tenant that is acceptable to the landlord.
A letting agent may charge a letting fee for their services relating to the grant or assignment of a tenancy.
There is more information on ending a fixed term tenancy here. For more on the rights and responsibilities of landlords and tenants, go to www.tenancy.govt.nz.
The Ministry of Business, Innovation and Employment provides information and guidance on building law and compliance, services including weathertight homes, and advice for tenants and landlords.