Can I break my lease early in New South Wales and what are the costs?
Yes, you can break your lease early in New South Wales, but you will usually have to pay a break fee. For agreements signed after March 2020, the fee is legally capped depending on how much of the lease remains. It ranges from four weeks' rent to one week's rent as you get closer to the end date.
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How it works in practice
Breaking a Fixed-Term Lease
Breaking a lease means you are ending your residential tenancy agreement before the fixed term has expired. In New South Wales, the law provides a structured framework for what happens when a tenant needs to leave early, primarily focusing on mandatory break fees.
The Mandatory Break Fee
For all fixed-term lease agreements signed on or after 23 March 2020, a mandatory break fee applies. This fee is strictly regulated by law and provides certainty for both the tenant and the landlord regarding the costs involved in breaking the contract.
The amount you must pay depends entirely on how much of your fixed term has already expired. If less than 25 percent of the lease has expired, the fee is four weeks' rent. If between 25 and 50 percent has expired, it reduces to three weeks' rent. If between 50 and 75 percent has expired, it is two weeks' rent. Finally, if more than 75 percent has expired, the fee is just one week's rent.
Agreements Signed Before March 2020
If your lease was signed before 23 March 2020, the rules are slightly different. Your contract might include a specific break fee clause, usually capped at six weeks' rent for the first half of the lease and four weeks for the second half. If there is no specific clause, you may be liable for the landlord's actual costs in finding a new tenant, including lost rent until the property is re-let.
Important exceptions
You can legally break your lease early without paying a break fee in a few specific circumstances.
If you have been offered and accepted a place in social housing, you can leave without penalty by giving 14 days' notice.
You can also end the lease without a fee if you need to move into an aged care facility.
If you are experiencing domestic violence, you can terminate your tenancy immediately without paying any break fees or penalties by providing a domestic violence termination notice.
Finally, if the landlord puts the property up for sale and did not disclose this before you signed the lease, you can leave without a fee.
What you should do now
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Review your tenancy agreement to confirm the exact start and end dates of your fixed term.
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Calculate your mandatory break fee based on how much of the tenancy term has already expired.
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Write a formal termination notice to your landlord or real estate agent stating your move-out date.
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Continue paying your rent up to the date you hand back the keys and vacate the property.
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Pay the calculated break fee to the landlord and immediately apply for your bond refund online.
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