ReThere are new break fees payable by a tenant who wishes to break a fixed term lease under Residential Tenancies Act 2010 and new Residential Tenancies Regulation 2019 which commenced on 23 March 2020
Mandatory break fees apply to all fixed-term agreements of 3 years or less, when a tenant ends the agreement early. This applies to agreements that are entered into from 23 March 2020.
The break fees are:
• 4 weeks rent if less than 25 per cent of the agreement has expired
• 3 weeks rent if 25 per cent or more but less than 50 per cent of the agreement has expired
• 2 weeks rent if 50 per cent or more but less than 75 per cent of the agreement has expired
• 1 weeks rent if 75 per cent or more of the agreement has expired
For example:
• If 7 months of a 12 month tenancy agreement (or 58 per cent) has expired, a tenant would need to pay a fee equal to 2 weeks rent to the landlord to end the agreement early
• If 2 months of a 6 month tenancy agreement (or 33 per cent) has expired, the tenant would need to pay a fee equal to 3 weeks rent to the landlord to end their agreement early
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