STR terminated early - should I refund rent?

7 Replies

I have a condo that generally functions as a short-term rental. I recently rented to employees of a construction company for a two month rental. I was primarily dealing with the owner of the company and had her sign a lease which states that rent would not be returned in the event of tenant default or other lease violation. I worked with her to resolve some complaints about noise and parking in the wrong reserved spot. Then I got complaints of leaving trash in common areas and urinating off the deck. At this point the HOA manager was threatening to fine me or even restrict my rental license so I terminated the lease and kicked them out. This was about one week into the second month and the lease rate is several thousand per month as it's in a vacation area. They asked about a pro-rata return of the rent which I said I'd consider if they left the condo clean and damage-free. They left the next day as I asked with no drama and the condo was left in good shape. On the one hand, I appreciate them leaving it in good shape and without a fight. On the other, returning the money technically violates the lease and represents further penalty to me as I would have been happy for them to stay for the duration and simply follow the rules. What would you do?

They default on the lease and as long as your lease states that rent will not be refunded in this situation, then I would not.
But you opened the door by saying "you would consider it". So it really depends on how you want to deal with that statement..... they did what you asked, probably based on the expectation of getting the pro-rated rent back....so do you consider " I'll consider it" a promise or just a tactic to get them out with less drama and you really had no intention of doing it.

Legally you should be fine based on your lease....

I would deal only with the owner of the company....she can deal with her employees that got kicked out for being stupid.

If its cut and dry in the lease....and you were justified in doing it, I would not refund the rent unless you get it rented back out really quick and don't lose $$.

Its not your fault that they acted like idiots and got kicked out. You should not lose $$ because they couldn't hold up their end of the contract. That's why many business have non-refundable deposit and cancellation fees.....hotels, airlines, doctors offices etc...... if you bail on me and I could have had another paying customer using my services at that time, then I'm not eating that lost revenue.... that's on you.

If I got lucky enough to rent it out real quick I may refund the $$ just to avoid the hassle of dealing with them if they put up a fight.... otherwise they are on the hook for the booked time

I would prorate the rent and kick back any unused portion.

In the future, you should be more clear about what happens in situations like this. If they leave early, of their own choosing, then they should be held responsible for the full term of the lease or until a new tenant takes over. If you kick them out for lease violations, I would argue they would lose any remaining rent money held but would refund the deposit if the unit were left in good condition and there are no additional problems.

By the way, I charge companies an increased rate of 25% and a mandatory cleaning fee (in addition to the deposit). I do this because they are placing employees in the property that are not paying the bills so they are far more likely to waste utilities, violate the lease, and not clean up after themselves upon departure.

In my area, it can cost a minimum of $150 a night per person at a hotel. Renting a house for $3,000 a month for four guys is a drop in the bucket.

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