Life happens. A new job interstate, a relationship breakdown, a family situation — circumstances change, and sometimes you need to leave a fixed-term lease before the agreed end date. NSW has a clear framework for how this works, including a set of fixed break fees that take a lot of the uncertainty out of the process.
Here's what you need to know.
What is "breaking a lease"?
Breaking a lease means ending a fixed-term tenancy before the end date. It's different from giving notice on a periodic tenancy, where you just give 21 days and leave. A fixed-term lease is a commitment for a specific period, and exiting early triggers different rules.
The fixed break fee schedule
For most fixed-term leases of three years or less in NSW, a set break fee applies. The fee is calculated based on how far through the term you are at the time you give notice:
- Less than 25% of the way through the term — 4 weeks rent
- 25%–50% through the term — 3 weeks rent
- 50%–75% through the term — 2 weeks rent
- More than 75% through the term — 1 week rent
Worth checking your lease — these set fees apply to most standard leases, but a few specific lease types use the older "actual costs" method instead.
What this means in practice
If you're three months into a 12-month lease (25% in) and you decide to leave, the break fee is three weeks' rent. That's the headline cost — but you also need to consider:
- Rent up to the date you leave or hand back the keys — whichever is later
- Any reletting costs if applicable (less common with the fixed fee schedule)
- End-of-tenancy obligations — bond conditions, condition report match, cleaning, etc.
The fixed fee replaces the uncertainty of "the landlord finds a new tenant in six weeks, you owe six weeks' rent." It's predictable, and that's the point.
Situations where break fees don't apply
There are specific situations where you can end a fixed-term lease early without the break fee:
- Domestic violence declaration (we have a separate blog on this)
- Hardship grounds approved by NCAT
- Significant breach by the landlord (e.g. the property becomes uninhabitable and they don't fix it)
- Where the landlord accepts surrender of the lease — sometimes a landlord, given the right circumstances, will agree to release the tenant
How to do it
The process is essentially:
- Give written notice to your landlord/agent stating your intention to end the tenancy early
- Calculate the break fee based on where you are in the term
- Continue paying rent until you hand back the keys (the break fee is in addition to rent up to handover, not a substitute for it)
- Complete the end-of-tenancy obligations — clean, exit condition report, bond claim
- Hand back the keys
Don't just stop paying and disappear — the break fee assumes you exit properly.
A note for landlords
When a tenant invokes the break fee, you receive the agreed amount, can re-let the property, and that's the end of the matter. You can't claim additional costs above the set fee for re-letting. You can still claim against the bond for damage, cleaning or unpaid rent up to handover.
When in doubt, talk to your property manager
The fee schedule looks simple but the calculations and the timing matter. If you're a Hunter PM tenant or owner working through an early exit, talk to us first — we'll walk you through it cleanly.