At East Bay Property Management, we’ve been managing properties throughout East Bay, California for decades. Throughout our experience managing these local properties, we have found many mistakes that landlords frequently make. These mistakes are especially made if the landlord is a new owner of a rental unit.
In this article, we are going to go over one specific landlord mistake; we’re going to discuss the tenant’s security deposit refund.
We’re certain that at least half of the disputes between landlords and tenants have to do with security deposits and their refunds. The first step in preventing these as a landlord is by making the details concerning the amount of the security deposit absolutely clear in the rental agreement. If you want to avoid disputes concerning any tenant’s security deposit, keep on reading. This will help you make sure that you’re handling your security deposit correctly, according to the law and in a fair manner.
Security Deposit Refund Form
Our team understands that it doesn’t matter whether you’re a new landlord or a more experienced East Bay landlord, everyone can use a helping hand.
That’s why we’ve equipped our website with different resources that can help a landlord through their journey. The security deposit refund form can be downloaded off of our website under “owner resources” or you can just click here to access the file.
As a landlord, when you’re filling out this form, make sure to put the tenant’s name, the address that you’re residing at, and the exact amount of the original security deposit. With this being completed, you as a landlord are ready to make your deductions and get a deposit back.
What Can a Landlord Deduct From The Security Deposit in California?
From the security deposit, a landlord may deduct any rent payments, like last month’s rent or this month’s rent, that are owed, the utility costs owed, their late fees and unpaid rent payments, and any cleaning fees that are required. A landlord must list all these in the rental agreement, as in accordance with state rental law.
What to Deduct?
In most cases, tenants are not able to keep the rental unit in the exact same condition as it was prior to them moving in to the landlord’s property.
1. Cleaning Costs
This is where most of the deductions come from. To clean an average three-bedroom-two-bath home professionally including inside windows here in the East Bay is right around $300.
So, that’s often deducted from the security deposit if the home was very clean prior to them moving in.
2. Untimely Damages
A landlord is also able to deduct due to damage to the carpet, paint, and blinds. These should all have at least a three-year lifespan. You can’t make any deductions on normal wear and tear.
So, in other words, if the paint was brand-new prior to the tenant moving in, and that same tenant only resided in the home for one year, you should not have repaint any walls when they move out.
Because they were there one year, and the paint should have a three-year lifespan, you can then deduct two-thirds of the cost of the paint from their security deposit.
If they were there two years you’re only able to deduct from their security deposit one-third of the painting cost.
And if they were there three years you can’t make any deductions on the carpet, paint, or blinds, because they have a three-year lifespan.
Other Items You Can Deduct
A landlord is also able to deduct for any unusual wear and tear. In alignment with California law, you can’t deduct normal wear and tear from the security deposit, but if something was broken or abused, and beyond normal wear and tear, the landlord may be able to make that deduction. This is because ordinary wear and tear is a common, inevitable occurrence.
Now, when it comes to your deductions in form, you as a landlord must send the security deposit return form and any monies owed within 21 days of the tenant moving out of the home of the landlord.
If it’s not done within 21 days then the tenant is entitled to receiving 100% of their security deposit back, so the landlord must make sure that that’s done within 21 days.
Any deductions over $125, according to rental law, require a receipt (at least an estimate). If a landlord doesn’t provide one then the deductions are not considered valid in small claims court.
There are instances in which a tenant can sue the landlord in small claims in certain cases. If conflicts between landlord and tenant arise surrounding the security deposit, these may be brought to a small claims court, according to California law.
If you have any questions concerning security deposits or anything else, call me, Mike, at 510-996-3238.
Good luck, and happy land-lording!
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