LEASE OF MIND - BEFORE YOU SIGN!
Hurray! My application has defeated the competition for my dream rental property. Where do I sign!!
Whoa there, not so fast!
It’s really exciting and a massive sense of achievement to be the successful applicant. We know - the agent is putting pressure on you to sign the lease –and she’s telling you that there are other applicants ready to snap it up if you don’t. But take a deep breath, and the time to make sure you thoroughly read and understand your lease before you sign on that dotted line.
A lease is a legally binding contract. So, like any contract you need to check it is correct and fully understand it and all its clauses and provisions.
Oh wow – where do I start?
Begin by checking all the details of the lease are correct. This includes:
Tenant names – whoever is named on the lease is legally liable for the rent;
Agreed rent and how often repayments are to be made. This should be the amount stated in your accepted application, so check if you varied this from the advertised figure. Different states and territories have variances in frequency of repayments.
A note on monthly repayments – Monthly amounts are calculated: Weekly rent ÷7 x 365 ÷12 = Monthly Rent
Details of when the lease starts and ends.
Ok – so that’s the basics covered, time to check all those clauses.
But I live in a state that has standard lease agreements – aren’t they all the same?
It’s important to understand all clauses of your lease – whether your state has a “standard lease” or not. Further any lease contract can be amended with additions and deletions.
The lease will cover what you:
Can’t do as the occupant of the property (for example fixing of items on the walls without consent, whether you can keep a pet);
Your rights as the tenant – for example in relation to quiet enjoyment; limitations on the landlord entering the property;
Practical details relating to repairs – scope for emergency repairs that you can approved, and when you need to get the property manager to ok;
Need to pay for in addition to the rent – such as water, gas and electricity and internet costs;
Are responsible for maintaining – such as the garden and/ or pool. Make sure you understand your obligations before signing the lease. Clauses must be correct and specific. So, if it was agreed that pool maintenance would be included in your application, make sure that the lease says this as well as who pays for the pool chemicals!
What if I want to move - can I break my lease?
It’s really important that you understand if you can end your lease before the end of the contracted term – and any consequences for doing so. Laws are very different here than in many overseas countries, and actually vary even in Australia.
In Australia, each state and territory has its own residential tenancy laws – and these vary on tenants’ ability to break a lease and the costs for doing so. These range from a penalty of several weeks rent, through to responsibility to pay the lease until a new tenant is found. Potentially months of rent!
And a word of caution – even in states, such as New South Wales, where under the law lease breaks are allowable with minimal penalty, many landlords/ property managers will remove the relevant clause on the lease. Even if it’s a standard lease, signed amendments are considered contract between tenant and landlord so by signing the lease you agree to a no lease break term.
For leases of more than 1 year, a Diplomatic Clause can offer some protection in case of the need to lease break. At EWR we regularly negotiate inclusion of these clauses, and have witnessed their value if assignee needs to be repatriated. This has been seen especially under COVID, with assignees returning to their home country and being able to terminate a lease early, saving our clients many thousands of dollars in rent!
So NOW can I sign my lease?
Once you understand and agree to all clauses, you should initial every page and sign and date the lease agreement. Delete and initial any blank spaces, such as those that relate to rental increases.
If you don’t understand or disagree, ask before you sign! EWR’s expert staff has more than 20 years’ experience, not only finding a new home, but ensuring the lease is correct, fair and reasonable, giving protection and peace of mind. Contact us to speak to someone about your lease!
Written by: Lucy Wood - Client Account Manager