07 August 2015
Ending a residential tenancy agreement ? considerations for landlords
Whether you are thinking of selling or moving into your investment property, different notice periods will apply in relation to your residential tenancy agreement.
What is a residential tenancy agreement?
A residential tenancy agreement is an agreement under which a person grants to another person or corporation, for value, the right to occupy residential premises for the purpose of using those premises as a residence. It does not have to include the right of exclusive occupation.
The agreement can be express or implied and it may be oral or in writing, or partly oral and partly in writing.
In NSW, residential tenancy agreements are governed by the Residential Tenancies Act 2010 (Act).
What are the different types of residential tenancy agreements?
There are two different types of residential tenancy agreements: fixed agreements and periodic agreements.
A fixed agreement is a tenancy for a fixed term – e.g. 1 year.
A periodic agreement is a tenancy that does not have a fixed term but which continues until it is terminated by either the landlord or the tenant – e.g. where the tenant continues to occupy the premises after a fixed term has expired.
When can I end my fixed agreement?
At any time before the end of the fixed term, a landlord can give a termination notice to its tenant, specifying a date on which the agreement is terminated. The date of termination can be any date on or after the last day of the fixed term but must be at least 30 days after the date on which the notice is given.
For example, Mary has rented her apartment to George. The tenancy expires on 30 October 2015. If Mary gives George a termination notice on 1 September 2015, the termination date can be on or after 30 October 2015. If Mary gives George a termination notice on 15 October 2015, the termination date must be on or after 14 November 2015.
Different rules will apply if the tenant has been renting the premises for 20 years or more.
When can I end my periodic agreement?
A termination notice can be given to a tenant at any time during a periodic agreement but the tenant must be given at least 90 days’ notice to vacate the premises.
The period of notice is reduced to 30 days if the landlord sells the premises and it is to be sold with vacant possession.
Do I have to tell the tenant when I decide to sell the premises?
Yes - at least 14 days before the premises are first made available for inspection by prospective purchasers, a landlord must give the tenant written notice of the landlord’s intention to sell the premises. The tenant does not have to allow the premises to be available for inspection by prospective purchasers more than twice a week.
I want to serve a notice to the tenant – what should I include in it?
To terminate a residential tenancy agreement, the termination notice which is sent to a tenant must:
- be in writing;
- be signed by the landlord or the leasing agent;
- allow the period of notice required by the Act;
- state the address of the premises;
- specify the day by which the tenant must vacate the premises; and
- state the grounds (the reason) for terminating the agreement.
The landlord/agent must ensure that the notice is sent or delivered to the tenant in accordance with the terms of the Act.
Do the same rules apply if a residential tenancy agreement is being terminated because of the tenant’s breach?
No - different rules apply if the tenant has breached the residential tenancy agreement and the landlord is terminating the agreement because of that breach.
This publication is intended as a source of information only. No reader should act on any matter without first obtaining professional advice.
Author: Irene Buryk, Lawyer