Cost of Breaking a Lease in Arizona

Last Updated: October 12, 2023 by Phil Ahn

In Arizona, tenants that break their lease early may be held liable for all remaining rent due and any property damage. However, landlords must make a reasonable effort to re-rent and must stop charging the old tenant if a new tenant is found.

Breaking a Lease Early Without Penalty in Arizona

In Arizona, a tenant may break a lease without penalty under the following circumstances:

• Domestic or sexual violence
• Early termination clause
• Death of the sole tenant
• Violations of the implied warranty of habitability
• Unenforceable, illegal, or void lease
• Harassment or violations of the tenant’s privacy
• Retaliation against the tenant for requesting a repair or reporting to a government entity
• Permanent change in military station resulting in relocation
• Refusal to reasonably accommodate a tenant with physical or mental disability

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In Arizona, a landlord can charge an early termination fee if the tenant breaks a lease early, but it must be written into the contract along with the terms. For example, a landlord may require 30-days’ notice and 2 months’ rent in order to break the lease early.

How Much Remaining Rent Could Tenants Owe in Arizona?

Arizona does not have a law limiting the amount a tenant owes a landlord when breaking a lease early. A tenant could be liable for the remaining rent through the life of the lease. However, a landlord must mitigate damages and seek to replace the tenant.

Landlord’s Duty to Mitigate Damages in Arizona

In Arizona, when a renter has broken their lease early, the landlord must make a reasonable effort to re-rent the unit. If the landlord finds a new renter, the original tenant who broke the lease no longer has to make rental payments. This is called a landlord’s duty to “mitigate damages [1].”

Although Arizona law gives no definition of what reasonable effort means when re-renting the unit, some examples associated with reasonable efforts include:

• The landlord must prepare the property for a new tenant in the same way they would as if they were between leases
• The landlord must advertise the rental vacancy

However, if a landlord cannot find a new tenant, the prior tenant is still liable for the remaining rent owed under the lease.

A landlord is not required to fill the unit with any tenant who wants to move in. The landlord is allowed to apply the same standards that they apply to all rental applications, such as having sufficient income to cover rent.

Tenant’s Right to Sublet in Arizona

A tenant can legally sublet in Arizona, but only with the explicit permission of the landlord. Unless the lease states otherwise, a tenant’s right to sublease is contingent upon receiving the landlord’s written consent.

Even though a tenant might have permission to sublet, the landlord retains the right to reject a prospective tenant. Reasons for rejection might include the subtenant being financially unable to make the lease payments.

If a tenant subleases their unit without the landlord’s explicit written permission, the tenant is in breach of the lease. In Arizona, a lease violation permits a landlord to evict the tenant and subtenant (starting with a 10 Day Notice to Comply or Vacate) and to sue the original tenant for any resulting damages. Landlords do not have to give any notice prior to beginning eviction proceedings.

In addition, the subtenant also may have grounds to take legal action if the original tenant sublet the unit without the landlord’s permission.

Consequences for Moving Out Early in Arizona

If a tenant breaks their lease and moves out early, the potential consequences include:

• The landlord keeping the security deposit
• The landlord suing the tenant for damages
• A lower credit score
• A potential bad reference in the future

Can the Landlord Keep the Security Deposit?

When a tenant breaks a lease early, it is possible for the landlord to keep all or part of the security deposit. The amount a landlord can keep depends on how much the tenant still owes in damages and the remaining rent.

When a lease is broken early, the landlord may subtract from the deposit, the amount of rent the landlord loses until a new tenant starts paying. If the owed rent becomes bigger than the security deposit then the landlord can hold the tenant liable for the difference—assuming the landlord has made a reasonable effort to re-rent the unit.

Similarly, a landlord may be able to deduct costs associated with property damage that were caused by the tenant. The damages should be caused by the tenant’s negligence and carelessness—not from normal wear and tear.

Can the Tenant Be Sued for Damages?

If a tenant breaks a lease early in Arizona, the landlord can sue a tenant for a breach of contract for the remaining rent due or for any property damage. Damages for less than $3,500 are considered “small claims” in Arizona and should be filed in the Arizona District Court.

If a landlord files in the District Court, they cannot bring a claim for more than $3,500. If suing for damages greater than $3,500, a landlord can file a claim in the Circuit Court for the county in which they live.