You Want To Leave - Breaking a Fixed Term Agreement

When you sign a fixed term agreement, you are signing a legal contract under which you agree to rent the place for an agreed minimum period. If you terminate your tenancy and leave before the end of the fixed term agreement, you may be liable to pay compensation to the lessor or provider for breach of the contract.

Your financial liabilities may include, but are not limited to:

  • Compensation for any loss of rent until a new tenant or resident moves in, or the fixed term expires, whichever occurs first
  • Advertising costs
  • A re-letting fee (a maximum equal to one week rent plus GST).

The lessor, agent or provider must take reasonable steps to keep their losses to a minimum, and cannot claim compensation for any expense that could have reasonably been avoided. For example the lessor or provider should advertise the property at the same price and act reasonably to find new tenants as quickly as possible.

To reduce the cost of breaking your agreement early you could:

  • Negotiate a written mutual termination agreement with your lessor, agent or provider, or
  • Apply to the Tribunal for a termination order, if applicable.
  • Advertise yourself, or ask the lessor, agent or provider to advertise and find a new tenant or resident to move in.