My tenant is breaking their lease.... with 5 days notice!

[mandimoo]

I asked my tenant yesterday if she plans to continue her lease which expires in a bit less than 2 months as my hubby told me that they had spoken to him about possibly moving on because they needed more space. Anyway she told me that they have been offered another house by a friend and plan to leave in a few weeks time, then today she told me they are moving out this weekend!

I cannot be bothered fighting to get money from them for rent, we always have a good relationship with our tenants (so far) and they offer to pay until new tenants are found, which I am sure they are legally obliged to anyway! The thing is that I want to do a freshen up of the place before putting it back on the rental market at 10% higher. I assume that there would be rules about carrying out capital works during a tenants paid period?

What is the best way to go about this? Should we just terminate their lease immediately as of next week and then go about our works and only then advertise for a new tenant? Or should we be advertising for a new tenant during works? I dont know how long the process will take I estimate only a week, how hard can it be hahaha yes I probably just jinxed myself!

Could have happened at a better time given that this weekend we are having our first guest at our holiday rental!

Please excuse anything I say that might sound stupid, Im a 27 year old stay at home mum of 3, I am not a business woman (although I do have a marketing degree....!) I simply do not have the brainpower to recall 3 million pages of legislation!

 

[zepth]

You are welcome to use the time to make improvements but you will not be able to collect rent from them while doing so. You will just have to treat it like they didnt break a lease if this is what you wish to do.

 

[Jake D]

If I could afford to, I'd probably let them out with minimal pain and just get on with my reno. But I'm way too lazy to argue over money if it doesn't cause me hardship.

Could have happened at a better time given that this weekend we are having our first guest at our holiday rental!

At least you will have some income from them to help towards losses.

Please excuse anything I say that might sound stupid, Im a 27 year old stay at home mum of 3, I am not a business woman (although I do have a marketing degree....!) I simply do not have the brainpower to recall 3 million pages of legislation!

My wife is a 27 year old, stay at home mother of 2, with a marketing degree, she is way smarter than me.

 

[wylie]

I would think you have two options -

1. Hold them to the lease, meaning you advertise the house "as is" and put off any further work until a time when there is not a break-lease situation. This means you advertise at the same rent amount and they pay for the cost of getting the new tenant.

2. Let them break the lease without penalty (possibly just ask for the balance of the notice they should have given you - probably two weeks). You don't charge them advertising or any further financial penalty because you want to get in and do a week's worth of renovating.

It all depends on how you are placed right now to do that week's renovation, how much difference the work will make in dollar terms.

If your life is busy right now, I would be inclined to relet it, get them to pay (as they are legally bound to do) and organise the renovation at a time when you have your ducks lined up. That way, you go back into the same position as if they hadn't broken the lease.

If they pay what they should, it means they are still paying rent whilst you are in there renovating, but you will possibly take longer, and then may lose a week or two finding new tenants, and also pay minimum of one week's rent to the agent for finding a new tenant.

You may lose three weeks' rent compared to losing nothing if they pay until a new tenant is found. I think a simple relet at the tenant's expense would be cheaper and you can still plan the renovation for another time.

 

[Ed Barton]

how confident are you that you will be able to quickly rent it 10% higher after the one week spruce up? Will one week turn into two and into three?

How much of the 10% is due to the spruce up and how much due to market rises?

If I was confident I could do it in a week and quickly rent it I would probably release them from the lease.

Otherwise I would just do a standard break lease and spruce it up later.

 

[mandimoo]

Very confident that we can achieve the higher rent with minimal sprucing, another in the same complex (small complex) is rented at 350 per week compared with our 320 and they are basically exactly the same. We bought the place almost a year ago and havent raised anything since then. The carpets are horrid because they are just really old and tired and they do have stains, the place hasnt been mistreated at all just neglected somewhat as it was owned by an elderly couple for its entire life (house 17 years old). Have contacted a painter he is going to charge $300 per day, I am hoping it only takes 2 days max to do the entire place.

Financially, my husband earns too much so we can afford a few weeks without rent if need be. I thought I wasnt allowed to do the work in her rental time, so that eases my mind I think I will just cut my losses on the day she moves out and arrange the works to be done asap so that I can get my awesome new tenants (optimistic much?) who will stay forever and ever and pay more rent which will in turn change our property to paying it's own interest only mortgage

 

[mandimoo]

And Jake D what a lucky wife you have, my husband finds it hard to accept that I am smarter than him hehehe

 

[Jake D]

And Jake D what a lucky wife you have, my husband finds it hard to accept that I am smarter than him hehehe

I also find it hard to accept and will only ever admit anonymously on a forum she doesn't read.

 

[Ausprop]

the rental market is so hot that you will probably get the increased rent even if you did nothing. hmm... do nothing, spend nothing - sounds like a better plan to me

 

[mandimoo]

It does sound like a better plan, but I dont think it will get the same as the other if I dont fix those bloody carpets, seriously they bring the whole place down. I wouldnt rent it with those carpets, and I want a tenant like me (but minus the kids). A tenant like me who wont start a war with the 90 year old neighbour with no legs, he has been through enough, first the actual war, then 4 months of living next door to our current tenant.....

 

[fokas]

My advice would be to get the property manager to put the old photos up from when you first bought it on the respective rental sites to start getting exposure and interest and the expected higher rent whilst you're refreshing carpets/repainting.
If the photos are horrid or won't reflect the increased asking rent, pay $150 for a floorplan to be done up and upload that in the mean time so prospective tenants can visual they're furniture going in and mentally measure how much space they'll have.
Nothing wrong with having a few people interested and waiting for the inspection which will be in a week or 2.

I also find it hard to accept and will only ever admit anonymously on a forum she doesn't read.

Ha! It seems I gave my kudos to you too soon!

 

[Jake D]

Ha! It seems I gave my kudos to you too soon!

Haha. For anyone interested, Fokas wrote "Takes a good man to admit his wife is smarter than him! "

In all seriousness, I do tell her she's smarter than me (although I think she can tell this from the dense looks I give her sometimes) and do everything I can to encourage her plans to study further and re-enter the workforce once our kids require a little less hands on time.

In other news, does anybody want to hire a 27 year old with a degree in International Business & Marketing but limited workplace experience? Call me for a reference.

 

[mandimoo]

I worked in marketing getting my 'experience' last year. It was a horrible 'experience', I worked 2 days a week through illnesses, when my children were too sick for school and daycare I got either my mother or husband to take time off THEIR work so that I could still show up for my 2 days a week since I was only part time and then for some reason (maybe super sperm I have no idea) I ended up pregnant with our 3rd child and as soon as I told my boss, he replaced me! Being a mother and working is very hard, the guilt is horrible you either feel guilty for not being there for your family or guilty for not being there for your employer.
We live an hour from where I was working (2 hours if I had have taken on peak hour in a car!) and I would get up at 5am get ready, get kids to daycare then my husband had to leave work earlier than usual on those 2 days to pick them up before daycare closed and I would only get home at 7, too wiped out to cook or do any laundry, just put the kids to bed with their tummies full of McDonalds and collapse into bed myself.
NEVER AGAIN am I going to put my family or myself through that
Okay never again until they have all grown up and are at uni at the earliest!

 

[redwing]

Hi Mandimoo

Are you using a Property Manager?

Wylie has offered some good suggestions also

My wife is a 27 year old, stay at home mother of 2, with a marketing degree, she is way smarter than me.

If you're older than 27 Jake, Congratulations

 

[matto_]

tenant breaking the lease and giving 5 days notice. Definitely within your rights to hold them to it.

As others have said depends whether you really MUST do the reno's now. If you are able to get same rent - why do you need to do the reno's right at this moment?

 

[Jake D]

If you're older than 27 Jake, Congratulations

About to crack 30. Not sure how I feel about that.

 

[mandimoo]

It is too late the renovations are locked in, although we went for the lesser option of just doing the floors and painting the kitchen. I really felt it needed to be done not just to increase the rent - you are right I could increase it anyway the way the rental market is - but to get a QUALITY tenant. If you present a shitbox its likely it will be treated like one (from my vast 10 months of experience bahaha).

 

[cimbom]

In other news, does anybody want to hire a 27 year old with a degree in International Business & Marketing but limited workplace experience? Call me for a reference.

Unfortunately, in Australia, marketing and related industries are hugely competitive, especially for entry-level positions. I work in PR and media relations and it was very difficult to get my foot in the door.

I did lots of volunteering and internships during uni and then did temp work, freelancing and more internships for almost two years after graduating before finally getting a full-time job. I know a lot of girls who got disheartened. stopped looking after a while and now just work in retail or similar.

It is tough but I wish your wife the best of luck. It can be a great area to work in

 

[Jake D]

It is tough but I wish your wife the best of luck. It can be a great area to work in

I think she's actually changed her mind and wants to do something completely different. But I don't think she's knows what, yet.

 

[Deltaberry]

My biggest advice to you is to forget all these things about taking them to tribunal, exercising your rights blah blah blah.

Let them go. Heck if they wanted to leave tomorrow, just take it. Re-let the place out ASAP. Less hassle. Going to court over $500 is a waste of time honestly.