Early surrender options (landlord won’t reduce marketed price)

Sensory

I surrendered my tenancy which has another year left before its fixed term expires, so I’m currently paying full rent in addition to a mortgage. I moved out a month ago so the property is vacant, but marketed at an unrealistic price considering current market conditions and comparable properties. The terms of surrender stipulate I must reimburse all losses incurred by the landlord, including any rental shortfall, so what reasons would the landlord have for not wishing to reduce the marketed price?

The property is managed by a high profile estate agent on behalf of a foreign investor who always takes days/weeks to respond to anything, and I’ve never had any personal contact with them at all in over four years.

theartfullodger

If you surrendered then the tenancy has ended.  It's a legal expression.

Suspect you mean you departed the property but didn't get agreement from Landlord to end tenancy.

Landlord does not have to agree early end orTry negotiation (eg offer say 3momths rent today to end it).  Whatever is agreed get terms in writing / email.

davidmcn

Sensory said:

The terms of surrender stipulate I must reimburse all losses incurred by the landlord, including any rental shortfall, so what reasons would the landlord have for not wishing to reduce the marketed price?

Because they'd then be stuck with that rent for the remainder of the new tenancy?

Sensory

theartfullodger said:

If you surrendered then the tenancy has ended.  It's a legal expression.

Suspect you mean you departed the property but didn't get agreement from Landlord to end tenancy.

Landlord does not have to agree early end orTry negotiation (eg offer say 3momths rent today to end it).  Whatever is agreed get terms in writing / email.

Sorry I should clarify, I signed a Surrender Letter which the EA drafted, stating that the landlord agrees to an Early Surrender subject to a replacement tenant signing a new tenancy agreement.

Sensory

davidmcn said:

Sensory said:

The terms of surrender stipulate I must reimburse all losses incurred by the landlord, including any rental shortfall, so what reasons would the landlord have for not wishing to reduce the marketed price?

Because they'd then be stuck with that rent for the remainder of the new tenancy?

Landlords are able to increase rent by any reasonable amount aren’t they? It depends on the AST of course, but the terms of the AST are also in their control.

numbercruncher8

If the landlord doesn't get a tenant, isn't the shortfall then the whole of the rent?

Personally I can see the attraction in not renting it out at all - you get the full amount of rent and there are no hassles in things breaking or extra wear and tear.

I would guess this is the reason behind the high price, they don't really want to rent it out while there is a guaranteed income stream.

greatcrested

Sensory said:

theartfullodger said:

If you surrendered then the tenancy has ended.  It's a legal expression.

Suspect you mean you departed the property but didn't get agreement from Landlord to end tenancy.

Landlord does not have to agree early end orTry negotiation (eg offer say 3momths rent today to end it).  Whatever is agreed get terms in writing / email.

Sorry I should clarify, I signed a Surrender Letter which the EA drafted, stating that the landlord agrees to an Early Surrender subject to a replacement tenant signing a new tenancy agreement.

As pointed out, the tenancy has not ended so you continue to owe rent (plus other obligations eg utilities etc).

You have requested an Early Surrender, which the LL is under no obligation to agree to.

He has stated the terms under which he would agree.

Is the property being marketed at thesame rent as yours, or more? You say it is 'unreasonable' but if its the same as yours, why should the LL agree to a drop in income?

However, why not have a discussion with the LL/agent and propose, for instance, a one-off payment to end the tenancy?

Your issue really stems from the fact that you seem to have signed a two+ year fixed term, with no Break Clause (is there one? Have you checked?) whilst looking to purchase a property.

Sensory

numbercruncher8 said:

If the landlord doesn't get a tenant, isn't the shortfall then the whole of the rent?

Personally I can see the attraction in not renting it out at all - you get the full amount of rent and there are no hassles in things breaking or extra wear and tear.

I would guess this is the reason behind the high price, they don't really want to rent it out while there is a guaranteed income stream.

Well of course it’s certainly in the landlord’s favour. I just happen to be on the short end because I was too stupid to include a break clause and ignorant of statutory periodic tenancies.

I’m asking what options I have available because I do not want to face the actual prospect of paying full rent for another 12 months, because I’m feeling exploited. Just because you can legally take advantage and profit from another human being’s unfortunate circumstances, doesn’t mean you should, but I guess not every landlord is reasonable.

I’m already standing to lose thousands as a result of reimbursing losses, which is fair, but to drag it out feels exploitative.

greatcrested

Sensory said:

numbercruncher8 said:

If the landlord doesn't get a tenant, isn't the shortfall then the whole of the rent?

Personally I can see the attraction in not renting it out at all - you get the full amount of rent and there are no hassles in things breaking or extra wear and tear.

I would guess this is the reason behind the high price, they don't really want to rent it out while there is a guaranteed income stream.

I’m asking what options I have available because I do not want to face the actual prospect of paying full rent for another 12 months,

* find a replacement tenant yourself who is willing to pay the rent being asked and is acceptable to the LL (referencing etc).

* negotiate a one-off payment to end the tenancy

* wait for the LL/agent to find a replacement tenant

* walk away and stop paying rent. Hope that the LL/agent does not pursue you through the courts.

* sub-let the property thus becoming a landlord yourself. 1) Almost certainly a breach of your tenancy terms so the LLmight start eviction proceedings or take other action (not sure what....!) and 2) you would have to comply with ALL the legal responsibiliies of a landlord (including paying tax on the rental income).

* find some leverage to 'pursuade' the LL/agent to agree the Early Surrender - is the gas report up to date? deposit protected? In time? UK address 'for serving notices'?

Sensory

greatcrested said:

As pointed out, the tenancy has not ended so you continue to owe rent (plus other obligations eg utilities etc).

Yes, I am fully aware of my continuing obligations; I just misworded my circumstances. I apologise for this confusion; I am not under any misguided assumptions regarding what I must continue to pay.

greatcrested said:

Is the property being marketed at thesame rent as yours, or more? You say it is 'unreasonable' but if its the same as yours, why should the LL agree to a drop in income?

Why would it be a drop in income? I am personally liable to reimburse all losses, including any shortfall in rent, meaning the landlord is guaranteed the original rent up until the end of my commitment period. The property is being marketed at a price higher than what I am currently paying (and far above comparable properties in the same area); however, the landlord isn't allowed to benefit either so I would receive the difference in such a case.

greatcrested said:

Your issue really stems from the fact that you seem to have signed a two+ year fixed term, with no Break Clause (is there one? Have you checked?) whilst looking to purchase a property.

No break clause. This issue stems from my naivety and ignorance, and back when I believed my circumstances would not be changing for 2 years.

Sensory

greatcrested said:

* find a replacement tenant yourself who is willing to pay the rent being asked and is acceptable to the LL (referencing etc)

* wait for the LL/agent to find a replacement tenant

These two are currently in motion.

greatcrested said:

* walk away and stop paying rent. Hope that the LL/agent does not pursue you through the courts.

* sub-let the property thus becoming a landlord yourself. 1) Almost certainly a breach of your tenancy terms so the LLmight start eviction proceedings or take other action (not sure what....!) and 2) you would have to comply with ALL the legal responsibiliies of a landlord (including paying tax on the rental income).

I won't stop paying rent; I intend to fully honour my legal obligations as agreed. I've asked the agent regarding subletting, but naturally, a response from the landlord is taking its time.

greatcrested said:

* find some leverage to 'pursuade' the LL/agent to agree the Early Surrender - is the gas report up to date? deposit protected? In time? UK address 'for serving notices'?

The high profile agent is very on the ball with these things, dotting every 'i' and crossing every 't'.

greatcrested said:

* negotiate a one-off payment to end the tenancy

This, I have not tried. It will probably take weeks before even an initial response, but I guess it cannot hurt to ask.