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A security deposit is a payment tenants are required to pay when first moving into a rental. In most cases, it’s a sum equivalent to the rent of one month.

California has a rather detailed security deposit law. Whether you’re a tenant or a landlord, understanding them is key. As a tenant, you need to be able to understand your rights; and as a landlord, you may be able to avoid common mistakes that may land you in legal hot water.

So, without further ado, we here at Eagle Property Management have gathered these answers to some of the most common questions regarding security deposits in California.

What Can a Landlord Deduct from a Security Deposit in California?

In California, landlords can demand a security deposit for various reasons, including:

Any utilities a tenant may fail to pay prior to moving out.

When tenants move in, they’re commonly assigned to utilities such as gas, electricity, and internet/cable. If a tenant moves out without paying these, their landlord can make appropriate deductions from their security deposit.

california security deposit interest

Excessive property cleaning.

According to California landlord-tenant law, tenants are required to leave the premises in the same condition they found it, minus normal wear and tear. Unfortunately, some tenants don’t follow this regulation. When that happens, landlords are entitled to use part or all of their security deposit to do the cleaning/repairs.

Missed rent payments.

Failure by a tenant to pay rent is a serious breach of the lease agreement. Yet, it’s usually one of the top lease violations tenants in California commit. If a tenant moves out without clearing their rent payments, or simply abandons the property, the landlord reserves the right to deduct the appropriate amounts from their security deposit.

Financial damage if the tenant breaks the lease early.

Life is unpredictable, and a tenant may decide they need to break the lease early for a variety of reasons. These could include moving closer to their new job, due to a divorce or separation, moving to a home they bought, and so on.

If the reason to move out isn’t legally justified, you may be entitled to keep some or all of their security deposit.

Negligent or careless property damage.

In California, you also have a right to make appropriate deductions to a tenant’s security deposit for needed repairs if they neglect the property.

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What is the difference between property damage and normal wear and tear?

Property damage is any damage that a tenant commits through neglect or on purpose and that affects the property’s value, usefulness or normal functioning. Examples include:

  • Clogged toilet due to improper use
  • Broken or chipped enamel in bathtub or sink
  • Broken or severely damaged windows
  • Chipped flooring
  • Installation of unapproved wallpaper

Normal wear and tear, on the other hand, is the expected decline in a property’s condition due to normal use. Examples include:

  • Partially clogged sinks due to aging pipes
  • Loose grout around bathroom tile
  • Faded carpet
  • Torn or faded wallpaper
  • Faded, peeling, or cracking paint

How much security deposit can a landlord charge in California?

The amount a landlord can charge a tenant for a security deposit depends on whether a unit is furnished or not.

If the unit is furnished, the landlord can charge as much as 3X the rent. If the unit is not furnished, landlords are required to charge a maximum of 2X the rent as a security deposit.

Are non-refundable deposits legal in California?

No, California doesn’ recognize non-refundable security deposits. California recognizes all money a landlord receives from the tenant (apart from the rent) as a deposit. All deposits are refundable at the end of the lease term, minus any reasonable deductions.

How should California landlords store a tenant’s security deposit?

Landlords are responsible for storing the tenant’s security deposit, and different states have different rules in regards to how landlords should store it. In California, however, landlords don’t have specific rules to follow in regards to storing a tenant’s deposit.

what can landlord deduct from security deposit california

Is a walk-through inspection necessary in California?

Landlords can choose to do a walk-through inspection if they want. A walkthrough inspection helps in documenting the condition of the property and allows the tenant time to fix any issues prior to moving out.

A tenant doesn’t have to agree to it, but if they do, the inspection must be scheduled no later than 14 days before the lease expires.

When do landlords need to return a tenant’s security deposit?

According to California state law on security deposit returns, once a tenant has moved out, landlords have 21 days to return the deposit, excluding any reasonable deductions (California Civil Code 1950.5)

What happens in the case of change in ownership?

Landlords will have two options during a change of ownership: They can either transfer the deposit to the new owner or give it back to the tenant.

Disclaimer: This blog is only meant to be informational and is not legal advice. If you require more help, please consider hiring a California property management company or attorney.