Break Lease Changes in Queensland - What Landlords need to know!

For years, Queensland landlords and property managers followed a clear process when a tenant broke their lease early. The outgoing tenant was responsible for rent until new tenants took over (or until the lease ended, whichever came first). Additionally, they were required to cover the equivalent of one week’s rent plus GST as a letting fee, along with advertising costs.

However, for leases signed on or after 30^th September 2024 onwards, these rules have changed significantly, impacting both landlords and tenants.

What’s Changed?

Under the new rental law reforms, break lease costs are now capped and must be calculated on a fixed scale depending on how much time remains on the tenancy agreement:

This means landlords can no longer require tenants to continue paying rent until a replacement tenant is found. The responsibility for re-letting costs is now reduced, making it less of a financial burden on tenants who need to exit their lease early.

What This Means for Landlords

While this change is intended to provide more certainty and fairness for tenants, it does pose challenges for landlords:

• Potential Financial Gaps: In some instances, Landlords may experience rental income loss if they can’t secure a new tenant quickly.
• Higher Advertising Costs: Since tenants are no longer responsible for advertising fees, landlords will need to cover this expense out of pocket.
• Less Flexibility: Previously, landlords could recoup most of their re-letting costs from the outgoing tenant. Now, costs are predetermined and may not fully cover the actual financial impact of a lease break.

Final Thoughts

While these changes shift more responsibility onto landlords, they also provide a clearer, more predictable structure for both parties. If you’re a landlord or investor wondering how these reforms will impact your rental property, our experienced property management team at Pam Court Realty is here to guide you through the transition. Get in touch today for tailored advice on how to protect your investment under these new rules.