What if tenants leave early?
Mary-Anne Bowring 14/02/2024
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Understanding Tenant Departures
Tenants may need to leave a property before the end of their tenancy agreement for various reasons. As a landlord, it’s important to understand your options and handle the situation effectively.
The Importance of Communication
While tenancy contracts are legally binding, negotiation is often a more practical and cost-effective approach than litigation. Good communication with tenants can help resolve issues amicably.
Common Reasons Tenants Leave Early
Tenants usually want to leave early for one of two reasons:
- Their circumstances have changed (e.g., job relocation, financial issues).
- They are dissatisfied with the property or service provided.
In some cases, they may believe they have valid reasons to break the contract and request a deposit refund.
Exploring Compensation Claims
If a tenant’s circumstances improve, negotiating a settlement may be a practical option. You could:
- Ask the tenant to contribute towards finding a replacement.
- Request a break fee (equivalent to 2–3 months' rent) to cover costs.
- Find a mutual agreement without resorting to legal action.
When Accepting Losses Might Be the Best Option
If a tenant genuinely cannot pay, legal action may not be worthwhile. Even with a court judgment in your favor, collecting unpaid rent can be difficult if the tenant lacks the financial means.
Moving Forward
Sometimes, the best course of action is to accept the situation and move on. Focusing on finding new tenants quickly and minimizing financial loss can be a more effective strategy than prolonged disputes. Would you like any refinements?
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Under Offer: This term applies to a property where the landlord is considering an offer but remains on the market. It implies that further offers may still be considered until the landlord formally accepts or declines the current offer.
Let Agreed: This term indicates that a landlord has provisionally agreed to enter into a rental agreement with a prospective tenant, pending additional checks and referencing. It doesn't require the prospective tenant to have paid a holding deposit.
Let: This term signifies an established binding rental agreement between the landlord and tenant.
For both lettings and sales, the guidance addresses additional terms:
New On The Market: This term is used for a property not advertised since its last sale or rental. It should only be used for a brief period.
New Instruction: It applies to a property assigned to an agent for marketing recently, even if it was previously listed with another agent without being sold or rented.
New and Exclusive: This term refers to a property that is either new on the market or a new instruction, exclusively available through a specific agent or portal.
New Method of Sale/Let: This term is used when a property is being marketed for sale or rent using an alternative approach to the original advertisement, such as transitioning to an auction or sealed bid.
Reduced: This term indicates that a property's price has recently been reduced. The reduction should be genuine and comply with the Chartered Trading Standards Institute's guidelines on pricing practices.