{"id":3351,"date":"2022-10-09T12:00:02","date_gmt":"2022-10-09T01:00:02","guid":{"rendered":"http:\/\/propertyupdate.com.au\/?p=3351"},"modified":"2022-09-06T15:23:09","modified_gmt":"2022-09-06T05:23:09","slug":"lease-renewal-residential-tenancies","status":"publish","type":"post","link":"https:\/\/propertyupdate.com.au\/lease-renewal-residential-tenancies\/","title":{"rendered":"The dos and don\u2019ts of lease renewal for residential tenancies"},"content":{"rendered":"

When it comes to residential property management, there are several rules and laws that must be followed in order to ensure landlords don\u2019t end up facing a cantankerous residential tenancy tribunal judge.<\/p>\n

One of the areas that can create confusion is lease renewal and the termination of tenancies.<\/p>\n

This is why it\u2019s so important to understand exactly what rights and responsibilities both the tenant and landlord have.<\/p>\n

Even though this might seem like a straightforward process, landlords must dot all \u201ci\u2019s\u201d and cross all \u201ct\u2019s\u201d in order to prevent any future complications.<\/p>\n

\"Rental<\/p>\n

Understanding the terms of lease renewal<\/span><\/h2>\n

The critical requirement with regard to any rental agreement is to have a thorough understanding of all clauses contained in the lease, particularly those pertaining to the initial term, vacancy date, and lease renewal options.<\/p>\n

Generally, lease terms will either be fixed tenancies for a specified period such as six or 12 months or periodic agreements which usually \u201croll over\u201d on a monthly basis.<\/p>\n

Essentially if you, the owner, wish to renew the lease or end the tenancy for any reason, you need to put your intentions in writing to the tenant.<\/p>\n

This is needed regardless of the type of agreement both parties have entered into.<\/p>\n

Landlords also need to be aware of the required timeframes to do either of these things.<\/p>\n

Whether terminating or renewing the lease or increasing the rental, tenants must be given sufficient notice under the Residential Tenancies Acts that govern most states and territories.<\/p>\n

What is the lease renewal notice period?<\/span><\/h2>\n\r\n\r\n\r\n
<\/div>\n

The least renewal notice period is the amount of time you need to give a tenant to renew or terminate their current lease.<\/p>\n

Individual states have different guidelines on what must be put in a lease renewal notice, how long you have to send the notice, and who can receive a notification.<\/p>\n

As a general rule of thumb, a landlord must give 30 days' notice to terminate a fixed-term lease at the end of the term or 90 days' notice to terminate a periodic lease at any time.<\/p>\n

If the landlord wants to renew the lease then they have to give 60 days\u2019 notice if they wish to increase the rent<\/u>, or they just need to advise the tenant before the end of the fixed term if they want to renew the lease on the same terms.<\/p>\n

However, these timeframes can be different depending on the grounds of lease renewal or termination - such as if the landlord wants to sell the property, the tenant has failed to pay rent breach of the tenancy agreement by either the landlord or tenant.<\/p>\n

On the other hand, a tenant only needs to give 14 days' notice if they want to end the lease at the end of the fixed term, or 21 days' notice to end a period agreement at any time.<\/p>\n

Who pays a lease renewal fee?<\/span><\/h2>\n

Tenants are not liable for paying lease renewal fees.<\/p>\n

A property manager<\/a>'s fees usually cover sourcing good tenants and managing the lease on your investment property on a day-to-day basis.<\/p>\n

The cost usually includes things such as organising and managing the payment of bills, council rates, strata levies, and other ongoing costs, collecting rent and chasing arrears, and organising maintenance and repairs.<\/p>\n

But there are a few things that a property manager<\/a>\u2019s fee doesn\u2019t cover - one of which is the lease renewal fee.<\/p>\n

The lease renewal fee, payable by the property owner<\/strong>, is usually equivalent to one or two weeks\u2019 rent <\/strong>and covers the cost of preparing a lease contract and advice on rent pricing.<\/p>\n

\"Rent\"<\/p>\n

What to include in a lease renewal notice to a tenant<\/span><\/h2>\n

If you are renting out a property on a periodic basis, there is no need to give a lease renewal notice to the tenant.<\/p>\n

The periodic lease will continue (with the original terms and conditions) until you or your tenant decide to end the agreement by giving notice.<\/p>\n

If you are renting your investment property out under a fixed-term agreement and want to move to another fixed-term lease, then your property manager will need to organise and send the tenant a renewal of lease letter at least two months before the lease is due to end.<\/p>\n

Within the letter, your property manager can also notify the tenant of any proposed changes to the terms of the lease<\/strong>. For example, if the rental provider or landlord is proposing to increase the rent<\/strong>, or to change some other terms<\/strong> of the lease, these changes can be summarised within this letter.<\/p>\n

It\u2019s worth noting that the new agreement can include different terms and conditions from the first agreement.<\/p>\n

The lease renewal letter must:<\/p>\n