Tenants are typically responsible for rent, utilities, and upkeep until the property is re-rented or the lease ends, whichever comes first, but terms must be consistently communicated, clearly agreed upon and in writing through an addendum to the lease.
We are seeing more and more in this industry a rise in the requests for tenants to prematurely break the lease, a legally binding contract between the landlord and the tenant.
When a tenant requests to break a lease early, property managers usually negotiate terms such as:
- Continued rent responsibility
- Utilities and lawn care responsibility
- Leasing or marketing fees
- Cooperation with showings
Real-World Scenario.
In one situation, a tenant asked to break the lease early and no longer be responsible for rent once they move out. That’s almost never going to be a solution, it serves only the tenant. A property manager is required to mitigate the losses of all parties and in doing so, facilitate an agreement between the parties to the lease [tenant and landlord] to ensure it’s fair but a landlord should not bear all the financial responsibility for a tenant's decision to break a lease.
What Most Landlords Get Wrong.
It must be communicated in writing in a signed agreement because without an agreement that the tenant is essentially releasing rights to the property for a new lease, you can’t write a lease on a property that already has an established lease in place, unless there are terms outlining the original lease is terminated.
Yet, landlords should welcome the consideration of a lease terminating early, in some cases, a lease may have normally ended in a poor time of year for marketing and leasing such as fall or winter where rents are typically lower and days on market are higher because there are less prospective renters house hunting during that time of year.
A tenant requesting to break a lease early may place the home in an optimal time of year and then both parties are at an advantage!
Key Takeaway.
Consistency and in writing with a signed agreement through an addendum to the lease, matters.
Changing terms after they’ve been communicated can:
- Jeopardize enforceability
- Lead to disputes
- Delay re-renting
Clear, approved terms upfront are critical.
