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If You’re a Landlord You need to Read This

California is passing a new law that prohibits landlords from demanding or receiving security for a rental agreement for residential property. The new law states “instead prohibit a landlord from demanding or receiving security for a rental agreement for residential property in an amount or value in excess of an amount equal to one month’s rent, regardless of whether the residential property is unfurnished or furnished, in addition to any rent for the first month paid on or before initial occupancy.” This bill was passed so apartments become more accessible to people who don’t have the funds at the moment to put in a security deposit. The secondary reasoning is to prevent overcharging. Many landlords have new renters deposit double or triple the monthly rent before renting an apartment that is unfurnished.

For renters this law is great, but what about the landlords side? For landlords this deposit is insurance for any form of possible damage and unpaid rent from the tenant. Landlords already have to take care of a place with many people living in it so there is a lot of up keeping involved to keep the tenants happy and safe. The security deposit can help fund that.

For someone who is apartment hunting this law is a good and possibly a bad thing. Since the deposit will be lower, there will be less apartments available on the market. The housing market at the moment is rough already and having more competition on top of that is going to make house hunting this summer very difficult.

No more than 4 units are exempt from this law. So that means mom and pop landlords can charge a fee that fits right for them. Although it does not have any effect on potential liability–landlords will still be able to seek damages from tenants who are responsible for harm to the property that exceeds the amount of the security deposit.

James McCormick

About the Author:

James McCormick

DRE #00804012

I’m a real estate agent with Sunbelt Properties in Long Beach, CA and the nearby area, providing home-buyers and sellers with professional, responsive and attentive real estate services. 

Want an agent who’ll really listen to what you want in a home? Seeking an adept agent proficient in the art of home marketing to ensure a swift and successful sale of your property?

Give me a call! I’m eager to help and would love to talk to you.

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