Dear all,

My mother has a property that she rented to a tenant (2 years+option to renew 1 year) According to the Tenancy Agreement, the rental for the option to renew year is fixed to be the same as year 1 and year 2. So if monthly rental for Year 1 and 2 is RM1600, then rental for Year 3 is also RM1600.

Problem for my mother is, the agreement was made and signed during the Covid years. This year, the average rental for a similiar property is RM2k as students return to campus (this property is in a university town).

The tenant is a good paymaster and never caused any problem and has made known her intention to take up the option to renew. However, my mother plans to reject the renewal and find another tenant who will pay RM2k.

My question is - can my mother do that? Is this a breach of the tenancy agreement? Can the tenant take my mother to tribunal/court and win? Is the tenant entitled to the standard 2 months'compensation for pre-mature termination of tenancy?

My mother don't speak English and I have to do all the work - I told her bad karma lah especially at her advanced age but she still insist on earning those extra hundreds of RM.

As mentioned in another thred. A deal is a deal. Unless tenancy agreement has an exit clause for you.

Actually, think of this way....
I know money lust is norm...btw
If is not for this RM1600 deal, the property might went empty for a year which is RM19200 Rental loss. RM1600x12. The current tenant might not even come to this unit
And come back to the new deal, RM2000-RM1600= RM400. Given 2 years = RM400*24= RM9600 more

Becoz of this RM1600 deal, ur mum rent out the unit 1 year earlier, making RM9600 more. RM19200-RM9600=RM9600

Sometimes we just cant win all

This post has been edited by taitianhin: Oct 14 2023, 02:48 AM

If you got a good tenant that pay on time and don’t cause problem, leave it as it is for that difference of amount. If u get tenant from hell then it’s a different issue

Option to renew doesn't mean must renew UNLESS both party agreed to the new terms.

In a TA, there is always a term for rental revision upon renewal and any new terms can be added.

Now coming to maths ....

For extra of 400 per month (4.8k per annum), let's say agent fee is 2k and minor repairs and repainting is another 2k and possible void period is another 2k. This is for first year only.

Second year onwards will not much problem.

If landlord can DIY, then should be ok but not forgetting the new tenant may not be like the old.

ALL INVESTMENT IS NOT RISK FREE. You may or not get 2k. Maybe only 1.8k or some other figures.

You are the landlord and you make the decision, either this renewal or next renewal.

This post has been edited by mini orchard: Oct 14 2023, 07:59 AM

Unless your unit has got ready tenant at 2k, then its worth getting a lawyer advise on option to increase rental rate or don't accept the extension. Otherwise just continue renting it at 1.6k while start looking for new tenant 9months down the road. Getting a good paymaster these days is hard to come by with rising cost of living.