NSW Ending the Tenancy Agreement

In NSW, ending a residential tenancy agreement is known as termination. The landlord or tenant can terminate the agreement under certain conditions listed below. This page gives a brief outline - click through on the links below for more detailed information about termination and compensation.

This guide covers landlords (or head-tenants) and tenants (or sub-tenants) in a Residential Tenancy. This applies to the majority of share accommodation and residential property rental situations. To confirm it covers your situation visit What is my share accommodation situation?

How does termination work?

Under NSW law, the tenant or landlord can terminate a residential tenancy agreement under certain circumstances. The landlord and tenant each have different reasons why can terminate the tenancy.

How do I notify the other party of termination?
Tenants and landlords must notify the other party of their intention to terminate the tenancy. The notice of termination must be in writing and signed by the person giving the notice. It must also state the day when the tenancy will be terminated and when the premises must be vacated by. The notice should also state the reason for termination.

The best way to give notice is to use the official NSW Government forms. There are different forms depending on whether the tenant or landlord is giving notice of termination:

for landlord giving notice to tenant: Landlord’s Termination Notice
for tenant giving notice to landlord: Tenant’s Termination Notice

The person who gives a notice to terminate can withdraw the notice at a later point if the other parties to the tenancy agreement consent.

When is a residential tenancy agreement automatically terminated?
The agreement will be automatically terminated if:

the landlord becomes entitled to possession from head-tenant
a mortgagee (e.g. a bank) becomes entitled to possession
a buyer of premises or similar becomes entitled to possession
the tenant buys the premises
the tenant gives up possession with the landlord’s consent
the tenant dies
the premises is destroyed or made uninhabitable because of something beyond the control of the tenant or landlord

The agreement can also be terminated by the landlord or tenant (see below).

Termination and Share Accommodation—how does it work?

Co-tenancies

When the Landlord Terminates the agreement
If the landlord terminates a tenancy agreement with multiple co-tenants, the termination applies to all of the co-tenants.

When a co-tenant terminates their agreement
If the tenancy is a periodic agreement or the fixed term has ended, then any co-tenant can terminate their own tenancy at any time. They must give a termination notice to the landlord and all the other co-tenants. The termination date must be at least 21 days after the co-tenant gives the notice.

If one co-tenant wants to move out before the end of a fixed term, the best option is usually to notify the landlord and help them and the remaining co-tenants find a new flatmate to take over from the outgoing co-tenant. If the landlord agrees to this, the tenancy agreement should be changed to include the new co-tenant and remove the outgoing co-tenant.

If the landlord does not agree to this, the co-tenant can terminate their own tenancy before the end of a fixed term if the Tribunal makes a termination order. The Tribunal can order the leaving co-tenant to pay compensation to either the landlord or remaining co-tenants, depending on the situation.

Sub-tenancies

If the tenancy agreement between the head-tenant and the landlord is terminated, the tenancy agreement between the sub-tenant and head-tenant will also be terminated. If this happens, the sub-tenant must leave the premises as soon as possible, or negotiate a new lease directly with the landlord.

Boarders or Lodgers

Boarders or lodgers who had agreements with a tenant must also leave the rented premises if the agreement between the tenant and landlord is terminated. If this happens, the boarder / lodger must leave the premises as soon as possible.

When can the Landlord terminate the tenancy?

The landlord can lawfully terminate the tenancy in 9 different circumstances:

End of a Fixed Term Tenancy - the landlord can terminate the tenancy any time after the end of a fixed term. They must give the tenant at least 30 days notice.
Terminate a Periodic Tenancy - the landlord can terminate a periodic tenancy at any time. They must give the tenant at least 90 days notice.
Sale of Rented Premises - if the landlord has entered a contract to sell the premises and that contract requires the premises to be handed over vacant, then the landlord can terminate the tenancy, with at least 30 days notice to the tenant. Remember, the date of termination cannot be before the end of a fixed term, otherwise the landlord may be liable to compensate the tenant.
Tenant Breaches the Agreement - the landlord can terminate the tenancy if the tenant has breach the agreement in a serious enough way that justifies termination. The landlord must give the tenant at lest 14 days notice.
Non-payment of Rent by Tenant - if the rent becomes 14 or more days overdue, the landlord can terminate the agreement by giving at least 14 days notice to the tenant.
Serious Damage or Injury - if the tenant seriously damages the rented premises or a neighbouring premises either deliberately or recklessly, or injures the landlord, the landlord’s agent, or any other person on the rented premises, then the landlord can terminate the tenant. The landlord does not have to give notice to the tenant, but it is recommended that they do so.
Illegal Use of the Premises - if the tenant uses the premises for an illegal purpose such as the manufacture or supply of drugs, then the landlord can terminate the agreement. The landlord does not have to give notice to the tenant, but it is recommended that they do so.
Threat, Abuse, Intimidation, or Harassment by Tenant - if the tenant seriously or persistently abuses or threatens the landlord or landlord’s agent, or intimidates or harasses any person on or near the premises, then the landlord can terminate the agreement. The landlord does not have to give notice to the tenant, but it is recommended that they do so.
Hardship to Landlord - if the landlord would suffer some kind of undue hardship due to special circumstances if the tenancy continues, then they can terminate the agreement. The landlord does not have to give notice to the tenant, but it is recommended that they do so.

When can the Tenant terminate the tenancy?

The tenant can lawfully terminate the tenancy in 4 different circumstances:

Terminating a Fixed Term Tenancy - the tenant can terminate a fixed term tenancy any time after the end of the fixed term. They must give the landlord at least 14 days notice. If the tenant terminates the tenancy before the end of the fixed term, they will generally be liable to compensate the landlord for lost rent for the remainder of the fixed term. See below for more information about compensation.
Terminating a Periodic Agreement - the tenant can terminate a periodic tenancy at any time. They must give the landlord at least 21 days notice of termination.
Landlord Breaches the Agreement - the tenant can terminate the tenancy if the landlord breaches the agreement. If the landlord challenges the termination in the Tribunal, the breach must be serious enough to justify termination. The tenant must give at least 14 days notice to the landlord.
Hardship to Tenant - if the tenant would suffer some kind of undue hardship due to special circumstances, then they can terminate the agreement. The tenant does not have to give notice to the tenant, but it is recommended that they do so.

What happens if the Tenant abandons the premises?

The tenancy agreement will be terminated if the tenant abandons the premises. The premises is abandoned if the tenant permanently vacates without giving a valid termination notice and stops paying rent. Abandonment occurs differently depending on whether the agreement is periodic or for a fixed term:

Fixed Term - if the tenant vacates the premises without giving a valid termination notice before the end of the fixed term.
Periodic - if the tenant vacates the premises without giving a valid termination notice.

If there are multiple co-tenants, abandonment only occurs if all the tenants have vacated the premises and rent is no longer being paid.

If the premises has been abandoned, the landlord is allowed to enter and retake possession. Because it is not always clear whether the premises has actually been abandoned, it is good practice for the landlord to seek an order from the Tribunal. If the landlord attempts to enter and retake possession but the premises has not actually been abandoned, then they will be in breach of the tenancy agreement and may have to compensate the tenant.

When can the Landlord or Tenant be compensated?

The landlord may be entitled to compensation if the tenant has breached the agreement or terminates a fixed term tenancy before the end of the fixed term. In the case of the latter, the tenant may be liable to pay an amount equal to the rent for the rest of the fixed term. Alternatively, the landlord and tenant can agree to a break free in the tenancy agreement.

If the landlord terminates the agreement unlawfully, the tenant may be entitled to compensation for moving out costs.

How does the landlord regain possession after termination?

Once a tenancy agreement is terminated, the landlord is entitled to retake possession of the premises. If the tenant moves out before the termination date, then the landlord can retake possession then.

If the tenant does not move out by the termination date and continues to occupy the premises, then the landlord should first remind the tenant that they must leave immediately. If this does not work, then the landlord should seek a repossession order from the Tribunal. The landlord should not attempt to physically remove the tenant themselves under any circumstances. If required, the Sheriff and/or police can remove a tenant that refuses to leave despite a repossession order.

The tenant may be liable to pay the landlord an occupation fee if they remain in the premises after the termination date.

What should happen to any goods left behind by the tenant?

Often a tenant may leave behind certain goods when they move out of a rented premises. There are restrictions and procedures for what can happen to these goods, depending on what they are. The landlord must give the tenant notice that they have left goods behind. This can be done in a number of ways: in writing, by post to the tenant’s last known forwarding address, or by telephone. If the landlord cannot make contact for 2 days then the landlord should give notice of disposal by putting a prominent notice outside the premises.

There are different rules for various types of goods left behind:

General Goods - the landlord must give the tenant a notice that their goods will be disposed of in 14 days if they do not claim them. If the tenant does not claim the goods in 14 days, then the landlord can dispose of them in any way that is not illegal, including selling them. If the landlord does sell the goods, they must keep a record of the sale price. The landlord must pay the sale price to the tenant if they request it.
Personal Documents - if the goods are personal documents, then the landlord must give the tenant a notice that their goods will be disposed of in 90 days. If the tenant does not claim the goods in 90 days, then the landlord can dispose of them. The first option for disposal is to return the documents to the authority or organisation that issued them (e.g. returning an Australian passport to the government passport office). If it is not possible to return the documents to the relevant authority, then the landlord can dispose of them in any way that is not illegal. The landlord ensure that the tenant’s personal information does not become publicly available. A good way to dispose of the documents would be to shred them and then place them in general rubbish.
- What is a personal document?
  - birth certificate, passport, identity document
  - bank books, financial statements or documents
  - photographs or personal memorabilia
  - licenses or qualification documents
  If the landlord keeps the tenant’s goods for any period of time, they must put them in a safe place where they will not be damaged or stolen.
  
  How does the tenant collect goods they have left behind?
  
  If the tenant does want collect any of their goods, they must do so before they are disposed of. The landlord cannot charge a fee before the tenant can collect the goods.
  
  In very limited circumstances, the landlord can charge the tenant an occupation for goods left behind. This fee can only be charged if the goods prevent the landlord more renting the premises to another tenant. The maximum amount of a occupation fee is the equivalent of 14 days rent under the tenancy agreement.
  
  If the landlord does charge an occupation fee, they cannot hold the tenant’s goods before the fee is paid. Goods must be given to the tenant regardless of whether the occupation fee has been paid yet.
  
  These legal guides provide a brief summary and introduction of the laws and regulations affecting share accommodation. They do not cover all cases in all legal jurisdictions and might not apply in your specific share accommodation situation. It is important that you use this information as a guide only and seek independent Legal Advice or consult the Relevant Acts. We do not accept any liability that may arise from the use of this information.