We provide expert property management in Newcastle and Lake Macquarie. Based in Charlestown NSW, we have been delighting Newcastle property investors with our personal, professional service since 2011.
Find out the 7 great reasons to work with us, and if you find this article helpful or enjoyable, please subscribe or share it with someone else who may benefit. We are often asked what happens when a tenant's fixed term lease period ends. In this post, we specifically address a number of questions relating to what happens to the tenancy agreement at the end of the fixed term (rather than discussing the rights and responsibilities of a tenant choosing to leave at the end of the lease). Below, we will cover the following questions related to this topic:
1. Does the tenant need to move out at the end of the fixed term lease?A tenant does not need to move out simply because the fixed term lease expires. The fixed term lease period provides a level of security and comfort for both the landlord and tenant, providing assurances around the rental amount, the duration in which the rent will remain unchanged, and an indication of the anticipated longevity of the tenant in the property. However, the tenant does not need to move out at the end of the lease period without this being specifically and correctly communicated. This requires that either the landlord or tenant provides a written termination notice to the other party with the applicable notice period required to end the tenancy. A landlord is required to provide 30 days notice to end a fixed term agreement, while a tenant must provide 14 days notice. Further details around what must be included in the termination notice are outlined on the NSW Fair Trading website. 2. Does the tenant need to sign a new lease in order to stay in the property?As indicated above, a tenant does not need to move out at the end of their fixed term lease unless the tenancy is terminated by either the landlord or tenant, advising the other party that they wish for the tenancy to end. Without either party giving notice to terminate, the tenancy automatically continues as a periodic agreement. A periodic agreement is simply defined in the Residential Tenancies Act as "a residential tenancy agreement that is not a fixed term agreement". Section 18 of the Residential Tenancies Act states that a fixed term agreement continues after the fixed term ends as if the term of the agreement were replaced by a periodic agreement, and on the same terms as immediately before the end of the fixed term. So, if neither party gives notice to end the tenancy, and the fixed term ends, the tenancy continues on the same terms as it did at the time the fixed term lease was expiring. 3. What happens if a tenant stays on in the property without a new lease?This then leads to the natural question - what's the difference between being on a fixed term lease and not being in a fixed term lease any more?
The most significant differences are around notice periods required to end the tenancy, and rules around rent increases. Notice Period To End A Periodic Agreement When in a periodic agreement (i.e. not a fixed term lease agreement), the landlord may give a termination notice at any time. Unlike the 30 day notice period to end a fixed term lease at the end of the fixed term, under a periodic arrangement the landlord must provide 90 days notice to terminate the agreement. However, if a tenant wishes to end a periodic agreement, 21 days is the minimum notice period required. Importantly, if a landlord issues a 90 day notice to terminate a periodic agreement, the tenant only needs to pay rent up until the date they provide vacant possession of the property. The tenant is not required to pay rent for the full 90 days of the notice period, and the date they choose to leave (and finish paying rent) could be much sooner! Notice Period To Increase Rent While in a typical fixed term lease agreement of less than 2 years, the landlord or agent can only increase the rent during the fixed-term if the agreement sets out the increased amount or how the increase will be calculated. The landlord or agent does not need to give the tenant written notice of the increase. For agreements with a fixed-term of 2 years or more, the rent can only be increased once in a 12-month period. A landlord must also give the tenant at least 60 days written notice. Under a periodic agreement, rent can only be increased once in a 12-month period, and the landlord must give the tenant at least 60 days written notice before the increase starts. We trust this article has helped to clarify some common questions around what happens to the tenancy agreement at the end of the fixed term. If you would like to know more to assist in the management of your property, contact us today.
We provide expert property management in Newcastle and Lake Macquarie. Based in Charlestown NSW, we have been delighting Newcastle property investors with our personal, professional service since 2011.
Find out the 7 great reasons to work with us, and if you found this article helpful or enjoyable, please subscribe or share it with someone else who may benefit.
22 Comments
Mark
16/9/2021 08:59:35 am
Hi if a Tennant has a lease expiring, say 15th October, can the landlord give notice on the 14th October asking the tenant to vacate the property? And will the tenant need to do so by the 15th?
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Hi Mark,
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Davy
20/9/2021 02:34:20 pm
Hi there,
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Hi Davy,
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Jo
24/9/2021 07:04:42 pm
Hi, My NSW lease expired 2 years ago, all of a sudden they have sent me a 'Lease Renewal offer' for the same rent. They are saying the lease term starts over 12 months ago. I don't have to take any action on it do I? There is no termination letter.
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Lewis
27/9/2021 04:26:15 pm
If a landlord fails to provide an official notice of termination with all due details, but it is technically 14 within the lease expiry date, can they still show prospective tenants through the property without the tenants permission? Is this a breach of the agreement to deny access even though there was no proper notice of termination? Thanks, Lewis (NSW)
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Hi Lewis,
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Emily
28/9/2021 07:07:29 pm
Hi
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Hi Emily,
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Emily
1/10/2021 12:30:27 pm
Thank you for your reply, Paul. I really appreciate your advice.
Jack
30/9/2021 09:09:17 pm
Hi there, our 12 month fixed-term lease has just expired. Prior to the lease ending, the agent asked if we would like to sign a new lease at considerably higher rental. We declined and counter offered a new, longer lease at a more reasonable increase. There was no reply from the agent, and the lease has expired. Have we now entered into a periodic lease, and would any rental increase need a 60 day notice period, and any end of lease require 90 day notice, even though the suggestion of a new lease at higher rent was raised by the agent prior to lease expiring?
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Hi Jack,
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Liam
6/10/2021 08:42:41 am
If I have entered in a periodic agreement and the landlord gives 90 days notice of termination of lease I understand that I can end that sooner but would I still have to provide 21 days notice or can I provide less notice?
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Hi Liam,
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Brett
6/10/2021 09:12:44 pm
Hi Paul,
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Hi Brett,
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Tristan Gold
9/10/2021 06:44:25 pm
My lease ends on the 19th october.
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Tristan
11/10/2021 09:56:55 am
Thank you so much for that info paul
Mona
13/10/2021 04:20:16 am
Hi, my fixed term lease ended in April 2021. Since I have been extending my stay and advising my landlord of extension every 3 monthly via email. No new contract has been signed. Am I in a periodic tenancy? Does my landlord require to give me 90 days notice to terminate the tenancy? If the landlord gives only one month notice what steps should I take? Thanking you in anticipation. Mona
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Hi Mona,
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Carnelian Property Management Newcastle NSWWe are a family-owned and run Charlestown real estate agent offering expert property management across Newcastle and Lake Macquarie. Want More?Build your property management knowledge - get regular tips and advice for landlords and tenants straight to your inbox.
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