Rent

How to break a lease in NYC

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Updated with additional reporting by Virginia K. Smith

For a whole host of reasons—job relocation, awful roommates, a relationship that hits a wall—renters prematurely break up with an apartment. After all, most people's lives don't line up tidily with the schedule of a 12-month lease. While ending a lease early is a pretty standard transaction in the world of real estate, unless you're relocating for work and have an employer willing to pay for the balance of your rent (lucky you), you've got some financial responsibilities to face before you leave.

"Basically, your lease is a contract, and you have to start from the position that you’re obligated,” says Manhattan real estate attorney Steven Wagner of Wagner Berkow. “You either have to find some reason to have the landlord agree to let you out or find something the landlord has done to breach the agreement." Below, your options for wrangling your way out of that lease, from the diplomatic to the devious:
 

THE LEGAL OPTIONS

The biggest mistake renters make in New York is assuming that the landlord has the responsibility to try to re-rent the apartment (i.e. “mitigate” damages) if the tenant walks before the lease is over, says Wagner. In reality, you're the one breaking the agreed-upon contract, and the responsibility lies with you.

However, the law does provide a couple of ways for you to reasonably get out:

1) Find another tenant: 

No matter what your lease says, New York law provides that if you offer up another, qualified tenant as your replacement, the landlord must assign the lease to that tenant and/or release you from your responsibilities within 30 days, or give a reasonable explanation for turning down the proposed tenant.  (You have a similar right to sublet if you live in a building with at least four apartments. If the landlord doesn’t respond to your request within 30 days—or within 30 days of receiving any additional information the landlord wants about the potential subletee—then by default, they've given consent.)

"If you can come up with an assign-ee who’s financially viable and qualifies, write a letter to the landlord saying, 'I want to assign my lease to this person and here’s why I want to do it,'" says landlord-tenant attorney Sam Himmelstein. "Provide documentation about the person." If the landlord turns down a perfectly qualified applicant, you could leave anyway, claiming that they "unreasonably refused consent," and risk being taken to housing court. "But landlords usually don't let it get that far," says Dan Marrello, leasing director at the brokerage firm Town Residential.

(One thing to note here: The right to assign your lease doesn't apply in co-op and condo buildings, says Marrello, but frequently you're dealing with individual owners who don't want to get attorneys involved, and are inclined to be reasonable. However, as buildings crack down on Airbnb and other short-term rentals, some boards will refuse to let the owner re-rent to a new tenant for a lease of less than 12 months, in which case, you may be stuck.) 

In any case, the trick here is finding a “qualified” tenant. 

“A landlord is allowed to reasonably withhold consent, and they have to give a valid reason or reasonable basis for the refusal,” explains Wagner. “What is reasonable will depend on the particular facts and circumstances, including financial responsibility, the legality of the proposed use, and  the nature of the occupancy—for example, if the new tenant wants to use the apartment as a psychiatrist’s office, that could be a reasonable basis for refusal.” (The Met Council has a guide here on what constitutes reasonable or unreasonable refusal.)

Your best bet is to find out your landlord's requirements before you start vetting potential candidates, and cast as wide a net as possible on social media, Craigslist, and search sites like Leasebreak and RentHackr.

2) Constructive eviction:

If you're leaving the apartment early because it has serious problems—such as mold, bed bugs, lead paint and construction noise—then you may have a case for constructive eviction, in which you allege that the landlord has failed to uphold the warranty of habitability conferred by New York law on all rental apartments. 

To claim constructive eviction, you must move out first.  “This is risky business because if you are wrong, you have to pay the rent,” says Wagner. Thus, before you move, it is wise to stick around and document the problems.

“Call 311 and have the Housing Preservation Department or the Department of Buildings come in,” says Wagner.  “If they issue violations, that is objective proof of conditions.”

In addition, you can take photos, send letters to the landlord, and call in experts to confirm the existence of mold, asbestos, secondhand smoke, etc.  If possible, get a Certified Industrial Hygienist (a “CIH”) to do the testing.  "A CIH has the highest credentials to do the testing," says Wagner.

Tactically speaking, the violations alone may be enough to pressure your landlord to let you out of the lease.  If you proceed further and go to housing court, you may win, but you'll wind up on the tenant blacklist, which could make life harder the next time you try to find an apartment.

THE DIPLOMATIC (OR GUERILLA) TACTICS

So much for your options provided by law.  Here are some other things to try, ranging from upfront to lower down.

1) Ask to be released

This should be the very first thing you do. "Contact the landlord and see if they'd let you out of the lease, and under what terms," says Himmelstein. "Some landlords will act reasonably, so always approach them first—they may ask you to find a replacement, or to give them regular access to the apartment so they can market it and show it to prospective tenants themselves."

If it's a larger-scale landlord, they might have a tenant that needs relocating, or even another apartment with dates and terms that suit your needs. (Some management companies will let you break the lease penalty-free if you're moving into another building in their network.) "People always try to do everything before they've even spoken to the landlord, when really that's who they should be contacting first," adds Marrello.

Notify your landlord in writing explaining the situation. “Send a registered letter to your landlord explaining why you need to break your lease,” advises Waite. “Ask them for any suggestions they might have that would allow you to get out of the lease.  They may keep you on the hook until they re-rent it, they may ask you to find a qualified tenant, or they may let you out with a penalty—anywhere from two or three months rent on up.”

Keep in mind that market conditions play a big role here: In a brisk rental market where the landlord expects to re-rent quickly, a penalty of two or three months' rent could add up to a nice profit.  (The dead of winter is typically a tougher time to negotiate an exit; if you can, wait until summer.) Alternatively, if your apartment is rent-stabilized and you’ve been there at least a year, the landlord will likely be more than happy at the chance to get you out, and potentially raise the rent.

The trick here, as in every situation that ends with you walking away early, is to get your landlord to sign a “surrender agreement” containing language that legally releases you from the lease, says Wagner.

 2Be annoying   

The simple fact is that the more annoying you are, the more likely your landlord will want you to make a hasty exit. Of course, if you take this approach you should stay well within the bounds of what's legally appropriate, such as calling in every little (but still valid) violation. And you do run the risk of the landlord growing so frustrated with you that instead of just getting you out by any means necessary, they become less amenable to negotiating terms that might benefit you.

“The misery you can cause starts with putting violations on the building,” says Wagner.  “There’s always something wrong with the building even if not in your apartment.”

If you choose this tactic (and think carefully before you do), here's where to look for ammunition:

  • The façade of the building, if it’s six stories or more.  If there’s anything weird such as bulges, cracks, loose mortar, or concrete or bricks that is popping off, call it in to the Department of Buildings as a potentially hazardous condition.  
  • Does black smoke come out of the building every time the boiler is on? Call it in. This is a common problem in older buildings, and terrible for neighborhood air quality.
  • If you live in a loft building, check the Department of Buildings website to see if there is a Certificate of Occupancy permitting residential use. If not, the landlord doesn't even have the right to collect rent in the first place.
  • Check the Department of Buildings website to see if there are any outstanding violations in your building. Call the city again and alert them to the fact that they have not taken care of violations.
  • If you rent a non-stabilized apartment, determine whether the apartment has been illegally destabilized to reach its current market rent.  (Tips on that process here.) “If the landlord overcharged you intentionally, you may entitled to treble damages,” says Wagner.  “The landlord may wind up paying you a lot of money and letting you out of your lease.”
  • Oil in the basement or an oil smell may indicate a leak, which can result in violations and big fines
  • For more potential violations, check out the Housing Maintenance Code.

 3) Pick your moment  

Just as landlords will be more likely to let you go during a hot rental market,  their grip on you may relax the closer you are to the end of your lease term. Hence, when you sign your lease to begin with, if you think there’s a possibility you may need to move, it’s better to take a one-year lease with an option for a second.

In rare cases, a landlord may even be willing to put in a clause allowing you to terminate with 60 days notice. 

“It’s not typical, but if you’re paying a lot of money for a lease and they’re really happy to have you, they might," says Wagner.

Related:

I want to break my rent-stabilized lease. What's involved?

The perfect landlord letter of recommendation

Renters score secondhand smoke victory. Now what?

Confessions of an on-site leasing agent

Guerrilla Guide to Finding a No-Fee Apartment (Part 1)

Winter rental tips: 5-10% off is not out of the question

4 rules for flaming your landlord online

 

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