Kick Out Clause

Exploring notices in lease agreements

A kick out clause is a clause in a lease agreement that allows either the landlord or the tenant to break the lease under specific conditions, such as the landlord needing to sell the property or the tenant needing to relocate for work.

An image of the letter K, representing this glossary category

While not an official term, the "Kick-Out Clause" is commonly used to describe a provision in a lease agreement that allows either the landlord or the tenant to terminate the lease under specific predetermined conditions. This flexibility can be crucial for both parties under changing circumstances.

Overview of the kick-out clause

Purpose of the kick-out clause:

  • Flexibility: Allows both landlords and tenants to adapt to significant life changes or opportunities without facing the full legal penalties typically associated with breaking a lease.
  • Protection: Offers a safeguard for both parties, enabling them to exit the lease when retaining it would be impractical or financially burdensome.

Common triggers for the kick-out clause:

  • Sale of Property: A landlord might wish to terminate a lease if they receive an offer to sell the property.
  • Job Relocation: Tenants who need to relocate for work can terminate their lease without penalty, provided this clause is included and activated under the agreed conditions.
  • Major Life Events: Other significant events like severe health issues or family emergencies can also activate this clause.

Drafting a kick-out clause:

  • Clear terms : The clause should specify what conditions qualify for termination, notice periods, financial responsibilities (like penalties or fees), and the process for notifying each party.
  • Legal compliance: It’s crucial that this clause complies with local housing laws, as improper terms can render the clause unenforceable.

Confidently writing notices

The so-called "Kick-Out Clause" provides valuable flexibility in lease agreements but requires careful consideration and drafting to ensure it serves its intended purpose without causing unintended consequences. Both landlords and tenants should clearly understand the terms before agreeing to include such a clause in their lease agreements.

Kick Out Clause

*Disclaimer: This article is for informational purposes only and does not constitute financial, legal, or real estate advice. The information provided is based on general market trends and should not be relied upon for making investment decisions. Market conditions can fluctuate, and it's recommended to consult with a real estate professional for specific advice. We are not liable for any decisions made based on this information.