Can you break a lease if you bought a house?

Rental Property Investor · Houston, TX · Member since 2019 · 184 posts · 147 votes

Hi guys, I need some feedback. I live in the Houston area and I am in the process of acquiring my first multi family property, which I will be house hacking. I am currently renting and my lease will expire before I buy this property. I heard u can break a lease as long as you you can prove you bought a house? What do you suggest I do? Go month to month (although it will be more expensive) until I buy the house or should I renew for one year and be able to break the lease when I purchase the property? Thank you very much in advance

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JD MartinBusiness Member

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Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes

Legally? No. What business is it of the landlord that you bought a house? Why is the landlord obligated to let you walk because you decided you wanted to be an owner instead of a renter?

The only "legal" lease breaking that I know of that is sanctioned by the government is that of military members, who are ordered to new bases and assignments and are usually allowed to break a lease for that reason.

Now will your landlord work something out for you? Maybe. For good tenants or the right time of year, I don't really care when they're leaving. Most of my good tenants go on month to month anyway at the end of the lease. If someone wants to leave in May versus November, especially if rent rates have reset, I'll usually let them walk without issue.

Edit: What you are trying to do is have it both ways. You want to go month to month for your convenience if/when you buy a house but you want the landlord to subsidize that by giving you an annual rate. You should either commit to the year for the cheaper price or take your chances on month to month. You're trying to become a landlord - how would you feel if your future tenant did the same to you? Kept your cheap rate in their back pocket so they could bail in the middle and leave you trying to find a tenant in January?

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Neil Henderson
Specialist · Carolina Beach, NC · Member since 2016 · 390 posts · 496 votes
7y
I know of some laws that allow new owners to break a tenant's lease so that they can move in, but I'm not aware of any laws that allow a tenant to break a lease because they've found a new place to live.

Read your lease carefully and call a real estate lawyer.

3 Reply
Alex Smith
Property Manager · Chattanooga, TN · Member since 2018 · 179 posts · 92 votes
7y
Talk it through with the owner and see what you can work out
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JD MartinBusiness Member
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Rock Star Extraordinaire · Northeast, TN · Member since 2015 · 10k+ posts · 16k+ votes
7y
Legally? No. What business is it of the landlord that you bought a house? Why is the landlord obligated to let you walk because you decided you wanted to be an owner instead of a renter?

The only "legal" lease breaking that I know of that is sanctioned by the government is that of military members, who are ordered to new bases and assignments and are usually allowed to break a lease for that reason.

Now will your landlord work something out for you? Maybe. For good tenants or the right time of year, I don't really care when they're leaving. Most of my good tenants go on month to month anyway at the end of the lease. If someone wants to leave in May versus November, especially if rent rates have reset, I'll usually let them walk without issue.
Edit: What you are trying to do is have it both ways. You want to go month to month for your convenience if/when you buy a house but you want the landlord to subsidize that by giving you an annual rate. You should either commit to the year for the cheaper price or take your chances on month to month. You're trying to become a landlord - how would you feel if your future tenant did the same to you? Kept your cheap rate in their back pocket so they could bail in the middle and leave you trying to find a tenant in January?
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Cody L.
Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes
7y
Originally posted by @Alex Ramirez:
Hi guys, I need some feedback. I live in the Houston area and I am in the process of acquiring my first multi family property, which I will be house hacking. I am currently renting and my lease will expire before I buy this property. I heard u can break a lease as long as you you can prove you bought a house? What do you suggest I do? Go month to month (although it will be more expensive) until I buy the house or should I renew for one year and be able to break the lease when I purchase the property? Thank you very much in advance

"Can you break a lease if you..."
Answer is "no" almost 100% of the time. A few exceptions are domestic violence and military service. Just go month to month. Give notice once you close.
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David Pere
Rental Property Investor · Springfield, MO · Member since 2016 · 1k+ posts · 890 votes
7y
No, but just bring it up to your landlord "I'm hoping to buy a property at X time, can I become month to month until I close? If closing falls through I will happily sign another one year lease." I'm sure they will work with you, I would.
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Russell BrazilBusiness Member
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Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
7y
No. But most landlords if you just talk with them are going to be understanding. They are afterall homeowners themselves.
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Bill B.
Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
7y
Do you want your future tenants to break their lease with you?
How much more is the MTM? $50/$100/mo? They gave you a place to live, treat em right.
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Alex Ramirez
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Rental Property Investor · Houston, TX · Member since 2019 · 184 posts · 147 votes
7y
@Neil Henderson thank you so much!
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Alex Ramirez
OP
Rental Property Investor · Houston, TX · Member since 2019 · 184 posts · 147 votes
7y
@Alex Smith great idea! Thank you very much
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Alex Ramirez
OP
Rental Property Investor · Houston, TX · Member since 2019 · 184 posts · 147 votes
7y
@JD Martin I really appreciate your feedback. So good! I hope you are doing great
1 Reply
Alex Ramirez
OP
Rental Property Investor · Houston, TX · Member since 2019 · 184 posts · 147 votes
7y
@Cody L. Thank you so much!
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Alex Ramirez
OP
Rental Property Investor · Houston, TX · Member since 2019 · 184 posts · 147 votes
7y
@David Pere awesome! Thank you so much for your great feedback
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Alex Ramirez
OP
Rental Property Investor · Houston, TX · Member since 2019 · 184 posts · 147 votes
7y
@Russell Brazil thank you so much for the feedback.
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Alex Ramirez
OP
Rental Property Investor · Houston, TX · Member since 2019 · 184 posts · 147 votes
7y
@Bill Brandt Very much appreciated.
1 Reply
John Teachout
Rental Property Investor · Concord, GA · Member since 2015 · 3k+ posts · 3k+ votes
7y
I just (today) had a tenant let me know they wanted to go month to month because they were looking for a bigger place. I let em do that for an extra 20 per month. That will take effect when the lease expires six weeks from now. They also asked if we had any larger properties as they wanted to stay with us. Unfortunately we don't in the county they want to live in (for the schools). We had another tenant go month to month because they were planning to buy. 14 months later, they're still there. Can't find something in their price range...
2 Reply
Anthony Rosa
Rental Property Investor · New York City · Member since 2019 · 703 posts · 538 votes
7y
Originally posted by @John Teachout:
I just (today) had a tenant let me know they wanted to go month to month because they were looking for a bigger place. I let em do that for an extra 20 per month. That will take effect when the lease expires six weeks from now. They also asked if we had any larger properties as they wanted to stay with us. Unfortunately we don't in the county they want to live in (for the schools). We had another tenant go month to month because they were planning to buy. 14 months later, they're still there. Can't find something in their price range...
Sounds like you have a good tenant that needs to leave for a bigger place and wants to stay in your properties. Good tenants are always on the top of our wish lists. Why charge an extra $20/month?

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Kenneth Mooney
Rental Property Investor · Augusta, GA · Member since 2016 · 348 posts · 171 votes
7y
@Alex Ramirez you should read your original lease. It should state what the terms are for early lease termination.
1 Reply
Max T.
Investor · Philadelphia, PA · Member since 2015 · 3k+ posts · 3k+ votes
7y
@Alex Ramirez
Communicate openly with the landlord.
Likely go MTM
1 Reply
John Teachout
Rental Property Investor · Concord, GA · Member since 2015 · 3k+ posts · 3k+ votes
7y
We charge extra for a month to month because the tenant may leave at a time of year that the house is harder to fill. We've found with SFR people don't like to relocate during the school year. So if someone moves out the end of October or November with all the holidays and whatnot, the property could potentially be empty for a while. Thus they're paying extra for the ability to move whenever they want/need.
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Matt M.
Specialist · Easton, PA · Member since 2018 · 1k+ posts · 2k+ votes
7y
I’ve done this twice (1st house, and after divorce). Both times my landlord just let me go (different landlords). They were happy for me that I was buying a house.
As a landlord now, I think I would do the same for a good tenant.
1 Reply
Alex Ramirez
OP
Rental Property Investor · Houston, TX · Member since 2019 · 184 posts · 147 votes
7y
All, thank you so much for your input. I definitely have a clear way forward now. I'll let you guys know how it goes. Stay tuned
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Cody L.
Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes
7y
Originally posted by @John Teachout:
I just (today) had a tenant let me know they wanted to go month to month because they were looking for a bigger place. I let em do that for an extra 20 per month. That will take effect when the lease expires six weeks from now. They also asked if we had any larger properties as they wanted to stay with us. Unfortunately we don't in the county they want to live in (for the schools). We had another tenant go month to month because they were planning to buy. 14 months later, they're still there. Can't find something in their price range...

Wow, you're a nicer guy than I am. We do +$75/month for 6 month lease, +$125/month for 3 month leases, and +$250 for month to month. And this is on sub $1000/month units.
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Daniel Townsend
Flipper/Rehabber · Cincinnati, OH · Member since 2019 · 75 posts · 53 votes
7y
@Alex Ramirez I think the last time I rented the landlord would let you out of the contract but you had to pay the rest of the money they would receive by the end of the contract. Potentially very expensive to do but they were promised that money after all. Either way they were getting their contracted funds and anyone leaving could get out early.
If it were me I’d pay the extra and go month to month.
1 Reply
Nathan Gruetzmacher
Investor · Auburn, CA · Member since 2016 · 32 posts · 14 votes
7y
@Alex Ramirez You should read into your lease agreement. A lot of property management companies/landlords have it written in for the opportunity to find a qualified tenant to fulfill the remainder of your lease. I have done this twice. If it's outside of a large property management company, simply asking your landlord may prove to be a better option.
1 Reply
Account Closed
Houston, TX · Member since 2019 · 6 posts · 0 votes
7y
@Alex Ramírez what area were you able to find a duplex? I'm interested in buying duplexes as well.
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