Q: My husband and I are breaking our lease because we finally bought a house. We sent a "notice to vacate" to our landlord and asked him to apply the same level of effort to re-rent our unit that he normally would if we had stayed until the end of our lease. He called and said he had received our notice and would start listing and showing the unit just as he does for all vacant units.
The landlord just called and informed me that the unit has rented on the first of the month, within days after we move out, and that he would be charging us $300 for the bonus that he paid to the agent who rented the house. He never mentioned this would happen when he first called in response to our notice. There is nothing in our lease about this. Does our landlord have a right to charge us for a leasing bonus to a real estate agent?
He would have had to pay this bonus anyway to rent the unit out three months from now if we waited until the end of our lease to move. We don’t think we should have to pay the $300 because the landlord didn’t get our advance approval.
A: I think you are quite fortunate to have this problem. You are concerned that you will have to pay $300 when your alternative is to pay rent for three more months.
In today’s tough rental market in most areas, tenants who break their lease are often finding that they are on the hook for the entire balance of the lease. As you discussed with your landlord in advance, the landlord is legally required to make reasonable efforts to re-rent the rental home you vacated, but it seems to me that you are actually well ahead financially.
You didn’t indicate the rental cost for the home you were renting, but even at a modest amount of $1,200 per month, the $300 leasing bonus is about one week’s rent.
Would you have preferred the landlord just stick a sign out in front of the property and hope that someone called in the next few months? You would then be obligated to pay the full amount of rent until the property was re-rented — and that could be thousands of dollars.
Regardless of whether the landlord’s efforts are successful, you are also obligated to pay all the additional costs of re-renting the property, which includes leasing commissions and advertising. So I think that you not only are legally obligated to pay the $300 but should be thanking your landlord for the fact that the $300 bonus probably saved you much more.
Your situation substantiates why I recommend that tenants who break their lease with significant remaining time on the lease seriously consider hiring their own rental agent to lease the property or offer the landlord or their property manger a bonus if they get the property re-rented immediately.
The faster the new tenant moves in, the sooner you are not paying housing costs for two properties!
You don’t have a problem to me, but you have a great story that illustrates how in tough economic times an entrepreneurial spirit and a little cash can make the difference in getting something done right away. Send your landlord the $300 along with a thank-you note and a nice gift.
Q: I am a landlord. My tenant, who has a long-term lease, has left the country for six months. She has let a third party stay in the leasehold without my consent and against my wishes. The lease states that only tenants may be occupants. The tenant claims that the third party is her "guest," and as she is entitled to have guests she is not in violation of the lease. I say the person is occupying the house.
A: Most landlords include a clause in the lease that specifically defines the limitations on how long a "guest" can stay in a rental unit. A common maximum term is a consecutive 14 days; however, a landlord needs to be flexible and work with tenants if situations arise where a longer term would be reasonable.
In your case, the tenant is out of the country and you know nothing about the current occupant. I understand your concern and can certainly agree that it is important for you to know who is occupying your rental unit.
However, there are actually advantages to having the rental unit occupied when your tenant is going to be gone for such an extended period of time as long as the occupant is not creating any problems or misusing the property.
Assuming that your tenant left the furnishings in place for her mystery guest, you are also able to avoid the extra wear and tear of a tenant turnover. And you will have your original tenant back in a few months. In the meantime, you may ask the mystery guest to complete your normal rental application and tenant-screening process.
This column on issues confronting tenants and landlords is written by property manager Robert Griswold, author of "Property Management for Dummies" and "Property Management Kit for Dummies" and co-author of "Real Estate Investing for Dummies."
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