Lease release terms

Question from Reinnette updated on 12th December 2018:

We signed a two year lease a year and a half ago. We struggled to pay the rent but it was do able. Now the rent has dropped around our property significantly. At the same time, we found a house we liked and purchased it.

I was advised that to get out of my lease they would have to drop the rent to let it to someone else - but I am liable to pay the difference until the contract finished. I don't think it is fair when they didn't replace the broken dishwasher for two months I didn't refuse to pay rent...

Our expert Jennifer Sykes responded:

Under the Residential Tenancies Act, a tenant or landlord in a fixed-term tenancy agreement cannot give notice to end the agreement before the end date, unless the premises is uninhabitable. The only ways to end it early would be for both the landlord and tenant to agree to an earlier end date, or if the Tenancy Tribunal decides to end the tenancy because of a breach of the Act or tenancy agreement. Or they may reduce the term of the tenancy in some cases if there has been an unforeseen change in circumstances which would lead to severe hardship if the tenant had to remain, which must be more than the hardship the landlord would suffer if the fixed term was reduced.

A landlord may agree to release the tenant from the fixed term tenancy early and may attach reasonable conditions to this consent - for example that they cover any reasonable costs incurred in finding a replacement tenant to take over (such as advertising), and that they would only accept a tenant willing to take on the same terms and conditions, such as the rent amount agreed to be paid until the end of the fixed term. Whether it is considered reasonable to pay the rent difference will depend on the amount and the length of time. If a landlord cannot find a tenant to accept the premises on the same terms then they can withhold their consent to release you from the fixed-term tenancy, if this was one of their reasonable conditions.

Speak to your landlord in the first instance if you think the terms to end the tenancy early are unreasonable, or to try and resolve any concerns related to any necessary maintenance and repairs that have not been done, or any other breaches of the Residential Tenancies Act. If you are unable to sort things out between yourselves then you can apply to the Tenancy Tribunal to have the matter resolved.

For more information on the dispute resolution process, as well as the rights and responsibilities of landlords and tenants, go to www.tenancy.govt.nz. You can also subscribe to our e-newsletter Tenancy Matters here.

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.

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