A fixed-term tenancy is a commitment that both landlords and tenants enter into with specific expectations. However, life circumstances can change unexpectedly, leading to the need to end a tenancy prematurely. While fixed-term tenancies generally cannot be terminated early, there are specific situations and options that allow for this. In this blog post, we’ll explore the scenarios in which a fixed-term tenancy can be ended early in New Zealand.
1. Mutual Agreement:
If both the landlord and tenants agree, a fixed-term tenancy can be ended before its designated completion date. The agreement should be documented in writing, outlining the terms both parties have consented to. It’s important to keep a copy of this agreement for reference.
2. Assignment and Subletting:
The Residential Tenancies Amendment Act 2020 introduced changes that enable tenants to request assignment or subletting of a tenancy. Landlords are now required to consider assignment requests and cannot unreasonably decline. Subletting can also occur under agreement. This option provides an avenue for tenants to leave a fixed-term tenancy earlier with proper arrangements.
3. Withdrawal Following Family Violence:
Tenants who experience family violence during a tenancy can leave the tenancy without financial penalty or landlord agreement. They must provide at least 2 days’ written notice, along with qualifying evidence of the family violence. This applies to both fixed-term and periodic tenancy agreements.
4. Termination Due to Physical Assault by Tenant:
If a tenant has physically assaulted the landlord, owner, family member, or landlord’s agent, and the Police have filed a charge, the landlord can provide written notice of at least 14 days to terminate the tenancy. Qualifying evidence of the filed charge is required.
5. Severe Hardship Application to Tenancy Tribunal:
Landlords or tenants facing unexpected circumstances that lead to severe hardship can apply to the Tenancy Tribunal for help. If the Tribunal determines that the applicant’s hardship is greater if the tenancy continues, they may decide to end the fixed-term early. An applicant must discuss the change in circumstances with the other party before seeking Tribunal intervention.
6. Rent Increase by Large Amount:
Tenants can apply to the Tenancy Tribunal to end the fixed-term early if a significant rent increase causes serious hardship. The Tribunal may consider the circumstances under which the tenancy was signed and the impact of the increase.
7. Changes to Body Corporate Rules:
For tenants renting apartments or flats, changes to body corporate rules that negatively affect them can lead to early termination. The Tenancy Tribunal can intervene in such cases.
When the Tenancy Tribunal decides to end a fixed-term tenancy early, compensation may be ordered to cover costs incurred by the other party due to the early termination.
While fixed-term tenancies are typically binding, certain situations allow for early termination. Navigating these options requires clear communication, understanding of legal obligations, and proper documentation. Whether you’re a landlord or a tenant, being informed about these scenarios ensures that you can make well-informed decisions in alignment with New Zealand’s tenancy regulations.