With any rental there are generally two categories of deposits that you can charge at the beginning of a lease agreement: a pet deposit and a security deposit. You can ask for a security deposit in California, but California is different from most states in that you cannot charge a pet deposit or a non-refundable pet fee. This means that any damage attributable to a pet must be taken from a security deposit.
Understanding Security Deposits in California
In California, security deposits are a standard practice for landlords to safeguard against potential damages, unpaid rent, or breaches of lease agreements. Governed by state laws, these deposits ensure fairness and transparency in rental agreements.
Maximum Security Deposit Limits
California rental laws security deposit has a maximum dollar amount which depends on whether the rental unit is furnished or unfurnished. For an unfurnished unit, the maximum security deposit California is two times the monthly rental amount and for a furnished unit it is three times the monthly rental.
Here’s what you can use the rental security deposit in California:
- to compensate the landlord for the tenant’s failure to pay rent
- damages to the premises, other than normal wear and tear, that are attributable to the tenant, tenant’s guests, or invitees
- cleaning the premises to bring it back to the same level of cleanliness as it was at the beginning of the lease term
- to remedy future defaults by Tenant in any obligation under this Agreement to restore, replace, or return personal property or appurtenances, exclusive of ordinary wear and tear
Interest on Security Deposits
In California, state law does not require landlords to pay interest on security deposit California. This means that unless a local ordinance mandates it, landlords are not obligated to return the deposit with accrued interest when the tenancy ends.
However, several cities in California, such as San Francisco, Berkeley, and West Hollywood, have local laws requiring landlords to pay interest on security deposits. These ordinances aim to ensure tenants earn some security deposit return in California on the funds held by landlords during the lease term. The interest rates and rules vary by city and are typically adjusted annually.
Permissible Deductions from Security Deposits
Before the tenant leaves the rental they must give the landlord their forwarding address. The landlord will, within 21 calendar days after the tenant vacates, send the tenant by mail a copy of an itemized statement that shows the original amount of the security deposit received and any deductions from the deposit. If there is a remaining portion of the security deposit it is then provided to the tenant. If the landlord needs to deduct more than $125 from the deposit then he must also include copies of documents showing charges incurred and deducted to repair or clean the premises, along with the itemized statement.
California is fairly specific about the information required on the itemized statement.
An important distinction is if the landlord did the work or if he hired someone to do the work. If the landlord or landlord’s employee did the work, the itemized statement must describe the work performed. The itemized statement shall include the time spent and the reasonable hourly rate charged.) If the landlord or landlord’s employee did not do the work, the landlord must provide the tenant a copy of the bill, invoice, or receipt for the work performed. The itemized statement must also include the name, address, and telephone number of the person or entity who performed the services.
Procedures for Returning Security Deposits
To help tenants address potential issues before moving out, California law allows tenants to request a pre-move-out inspection. During this inspection, landlords can point out problems that may lead to deductions, giving tenants the opportunity to make repairs or clean the property themselves.
Once deductions are finalized, landlords must mail or personally deliver the remaining deposit and supporting documents to the tenant’s last known address.
Updates to California Security Deposit Laws (2024)
While California’s foundational security deposit laws under Civil Code §1950.5 remain unchanged, it’s essential to stay updated on recent trends and local adjustments in 2024. Key points include:
- The basic framework of security deposit law in California: 2 months for unfurnished units, 3 months for furnished.
- Cities like San Francisco, Berkeley, and Los Angeles continue to enforce local rules that may differ from state law.
- Tenants are encouraged to request pre-move-out inspections to address potential deductions and ensure compliance with deposit return procedures.
Bottom Line
Now that you have a solid understanding of the latest security deposit law in California, you can approach your rental experience with confidence. This article has offered practical advice to help you navigate the process of deposits and deductions smoothly, so you can avoid disputes and keep things on track.
