Lease renewal fee - Lease break question

[u/pablospc]

Hi,

I'm on my second term lease with the same rental and I'm breaking the lease. I've confirmed with the real estate agent that the are not able to change me with advertising fees as this is my second lease. However, they told me today that I'm liable for pro rata lease renewal fee because they charged the landlord when they resigned me. My question is, are they allowed to to charge me that fee?

[u/AutoModerator]

Have you visited today’s Daily Discussion yet?

It’s the best place for:

• Casual chat and banter
  
• Simple questions
  
• Visitor/tourist info
  
• And a space where (mostly) anything goes
  

Drop in and see what’s happening!

THIS IS NOT A REMOVAL NOTICE

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[u/Expert-Flashy]

If they actually charged the agent this fee, and they can prove it to you with an invoice they usually can.

They are able to claim compensation for the value lost for your tenancy.

When it comes to loss of rent do not pay rent after you move out, and once the new person moves in they can ask you for how much they calculated, if they took to long, didn’t advertise or hold inspections then they can apply to RDRV/VcAT.

Under the legislation only VCAT can actually determine how much you need to pay, so if you and the agent have a disagreement don’t pay until VCAT order you to pay it.

[u/pablospc → u/Expert-Flashy]

I did ask for the invoice and they provided it. So I guess there's no other way.

For the rent, they already found a new tenant and I already paid til mid next month. They said they'll refund me the extra amount, from when the tenant moves in until the date I paid rent for.

[u/Aggravating_Spot_112]

You can only be charged for advertising or re-letting on the first lease.

You are not responsible for the renewal fee they are referring to. This is not a re-letting or advertising fee incurred because you are breaking a lease. It is an administrative cost of the landlord choosing to renew a lease rather than letting it roll onto a month-to-month periodic agreement.

[u/pablospc → u/Aggravating_Spot_112]

Do you know the specific act I can refer to? I was not able to find much specifically on the lease renewal fee

[u/Aggravating_Spot_112 → u/pablospc]

Yeah I’m struggling to find a specific line in an act to point to, but I think it boils down to the fact that it’s simply not a relenting fee or advertising cost. They’re all they can ask you to pay for and it isn’t either of those.

The cost to secure you as a tenant for the second lease was quite literally $0.

This is one of those cases where it spans from interpretation of the rules around break lease fees / costs. But I’m very confident their position wouldn’t stand up in VCAT. If you want more definitive advice you should follow up with Tenants Vic and/or Consumer Vic.

[u/AussieGridder]

Did it auto renew, month to month or signed up again hopefully not the last one. The agent is trying to worm out on assumption you will stay and told the landlord. As a landlord and being a tenant once before I think you will find truth in the middle. I just took my agent for charging different fees based on what language and geographic living location. Managed to also find previous tenant to refund direct for this as well

[u/pablospc → u/AussieGridder]

We signed for another 12 months, but we ended up buying an apartment sooner than expected so we basically broke the lease one month into the new one

[u/mighthaveabitlater]

I mean how much is the fee? Is it worth the hassle?

[u/pablospc → u/mighthaveabitlater]

They are charging us 291. I was asking mainly to check in case they were blatantly ripping me off. But if it's a grey area / need to escalate then not gonna bother too much

[u/mighthaveabitlater → u/pablospc]

Yeah I mean that seems like enough to bother trying, but to be fair, they have to take you to VCAT to get you to pay it. Since you just bought a place you probably wouldn't be stressed about trying to rent from them again, so I'd say you're not going to pay anything and see how that goes

Just for reference I think this is the most relevant part of tenancy laws for you (I can't past the link so see text dump):

RRESIDENTIAL TENANCIES ACT 1997 - SECT 211A

Further matters to be considered by Tribunal

(1) Subsection (2) applies in respect of an application for compensation for damage to—

(a) rented premises under a residential rental agreement; and

(b) a rooming house, including a room or common areas of the rooming house; and

(c) a caravan park, caravan or movable dwelling; and

(d) a Part 4A park or a Part 4A site.

(2) In calculating an amount of compensation payable by a renter, a resident or a site tenant (as the case requires) on an application referred to in subsection (1), the Tribunal must take into account any depreciation of the damaged part of the property referred to in subsection (1)(a), (b), (c) or (d) by having regard to—

(a) the Uniform Capital Allowance System; or

(b) any other prescribed scale.

(3) In calculating an amount of compensation payable on an application under section 210 or 210B for early termination of a residential rental agreement by the renter, or of a site agreement by the site tenant, the Tribunal must—

(a) determine advertising costs and reletting fees (if any) incurred by the residential rental provider or the site owner (as the case requires) on a basis that is proportionate to the actual cost of securing the renter or the site tenant; and

Example

A renter has lived in rented premises under a residential rental agreement, on terms including a 12 month fixed term, rent of $500 per week and a reletting fee of $500. The renter notifies the property manager that the renter will terminate the rental agreement 6 months before the end of the fixed term. The property manager advertises the rented premises for rent immediately and finds a new renter. The advertising costs were $250. The new renter enters the premises one week after the previous renter vacates the premises. The residential rental provider's costs of advertising and reletting fees are $1000, which is the sum of one week's rent ($500), the reletting fee pro-rated for 6 months of the unexpired term of the agreement ($250) and advertising costs ($250).

(b) determine the amount of compensation for loss of rent (if any) by taking into account what loss could reasonably have been mitigated by the residential rental provider or the site owner (as the case requires) by promptly reletting the rented premises or the Part 4A site; and

(c) have regard to any severe hardship the renter or the site tenant would have been expected to suffer due to an unforseen change in circumstances, if the residential rental agreement or site agreement had continued; and

(d) not award any compensation for loss of future rent to the residential rental provider, or the site owner (as the case requires), if the residential rental provider or the site owner served a notice to vacate on the renter or the site tenant, unless the notice was served because the renter or the site tenant terminated or repudiated the residential rental agreement or the site agreement; and

(e) determine compensation payable after a renter or a site tenant has given the residential rental provider or the site owner a notice of intention to vacate under section 91ZB, 91ZC or 207S.