How to deal with an early cancellation of a residential lease

In ideal rental situations, when a lease is signed the tenant will stay for the full duration of his lease without any complications and the landlord will uphold his obligations, creating a win-win situation for tenant and landlord. 

What happens though when the lease is to be cancelled early, whether due to the tenant’s circumstances changing or to the landlord wanting his unit vacated?

This can be a tricky situation to deal with, says Sunell Afrika, rentals manager for property company, as there are obligations to fulfil from both sides, depending on the situation, and the vacating of the premises needs to be handled as amicably as possible. 

If there is no cancellation clause in the lease, stipulating conditions where an early cancellation is acceptable and the terms of such, or if either the landlord and tenant are not in agreement with the termination, then either the Consumer Protection Act (CPA) or the Rental Housing Act (RHA) would apply.

A landlord cannot terminate the lease early unless there is a breach in the contract, as stipulated in the RHA, section 4 (5)(c).

If there is a breach in the contract, i.e. either the tenant has not paid his rent on time or if the landlord fails to perform his duties as stipulated in the lease, then the standard “breach of contract” procedure would follow. The guilty party is given a certain amount of time to remedy the breach, failing which the innocent party can then cancel the lease.

If the tenant would like to end his lease early, he may apply the CPA ruling, which says that he may “for any reason whatsoever (which may be entirely unrelated to a breach by the ... landlord) by giving the landlord 20 days written notice of the cancellation”. The CPA also does say that the landlord is entitled to a “reasonable cancellation penalty”, which is subjective as what is reasonable for one may not be reasonable for another, says Afrika, but guidelines for this are provided for in Regulation 5 of the CPA.

Often landlords or rental agents would assume that it would take a month to find a tenant, which would mean that the penalty would be a month’s rent, she said. 

If a lease is to be cancelled early, for whatever reason, this must be done in writing giving the other party ample time to react or respond, said Afrika.

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 22 May 2018
      Extreme weather appears to be the new normal, evident by the volume of insurance-related disputes reaching the industry watchdog’s desk. To avoid a situation in which your insurer refuses to pay up, you should proactively ensure that your home is well-maintained and ready for whatever winter has in store.
    • 22 May 2018
      As the impact of technology on the real estate industry becomes more significant, it is clear that there is a need for an objective look at not only traditional real estate models but also online and other alternative low-commission real estate agencies, to examine what they offer and what their impact might be.
    • 22 May 2018
      According to Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, dealing with some sort of neighbour dispute is an unavoidable part of life unless, perhaps, you choose to live on a remote small holding for the rest of your life.
    • 22 May 2018
      Buyers feel that they are getting value for money in the Northcliff area without having to compromise on aesthetics and amenities
    • 21 May 2018
      Secure living is one of the growing property trends in South Africa and Nooitgedacht Estate in Stellenbosch certainly ticks the right boxes for buyers who want a secure, exclusive lifestyle in one of the Boland’s most sought-after estates, says Pam Golding Properties.
    • 21 May 2018
      With sectional titles growing in popularity, an increasing amount of homeowners simply do not have the garden space to install a tool shed in their backyard.
    • 18 May 2018
      Home improvements are a great way to add value to your property, but not all of us have bottomless pockets for a full-on renovation. Lucky for us, there are plenty of affordable DIYs that can spruce things up over a free weekend.
    • 18 May 2018
      The need for large office spaces is slowly eroding as more and more employers choose to allow their staff to work remotely. As a result, the home business model has grown in popularity, with many new entrepreneurs choosing to start their business from home rather than in a business district. But, what are the legal implications of operating a business in a residential area?
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us