Real Estate Matters: Out-of-state college student seeks to break lease due to COVID-19
Q: In January, my grandson and three of his friends agreed to rent a four-bedroom apartment near the campus starting in August, when school was supposed to resume. They signed the lease in January. The four students each signed separate leases (with parents co-signing), and each student put up two months of rent upfront, totaling $1,600 each.
In April, during spring break, the university announced that due to the COVID-19 pandemic, it would finish out the semester with online-only classes, which my grandson did from his home in Dallas. Meanwhile the university recently decided that the fall semester would be the same, so my grandson and his fellow students will all be at their homes, in Dallas, Denver and Chicago.
All four students are trying to cancel their agreements, but the landlord insists nothing less than 12 months rent ($9,600 each). My grandson is in a high-risk category for COVID-19 because of asthma and a heart condition, so he will not return to Arizona at all this year. Is there any advice you can give us that will allow us to cancel these leases?
A: You raise an interesting question. Should your grandson (and his friends) be allowed to break their lease because the university has switched to online learning? Your second question, whether your grandson’s special health issues should give him special dispensation to break the lease, is also interesting.
While your son or daughter co-signed on renting an apartment for your grandson, we assume that nothing in the lease ties the lease to the school year calendar or anything to do with the university.
The landlord doesn’t know whether your grandson is a student, works for the university or has other responsibilities that are completely outside the university’s purview.
If he had leased housing from the university, we’d assume that entry to and occupancy of the housing would be specifically tied to your grandson’s studies and to the school calendar. If so, many (but not all) universities are refunding some or all of the housing costs to students because they won’t be on campus for some, most or all of the next school year.
The issue of paying for housing and on-campus activities and amenities when students are only attending classes virtually is sticking in the craw of almost every parent and student we’ve heard from or talked to over the past few months. And while many universities have refunded some of the housing cost, some are simply offering only a slight discount on the full cost of tuition, room and board for the next school. If the students are not on campus, we don’t think many, if any, are charging for room and board.
We understand your grandson and his friends (and their parents) want to terminate the lease, but look at it from the landlord’s perspective. The landlord assumes he has rented an apartment for a year. When the students and their parents signed the lease, they became obligated to pay their rent to the landlord for the next 12 months. In exchange, the landlord took the apartment off the market and may have lost out on other potential tenants.
Someone is going to lose out in this arrangement due to the pandemic. The question is, who bears the risk and responsibility for the payment?