San Diego Property Management Blog

What Do San Diego, CA Landlords Need to Know about Security Deposits?

What Do San Diego, CA Landlords Need to Know about Security Deposits?

Over 3,000 renter households face eviction in San Diego every year.

As a San Diego landlord, eviction is a worst-case scenario. Not only does it mean you've got a tenant causing you distress, signaling a flaw in your tenant selection methods, but it's also a long, drawn-out process that costs time and money.

There are a few ways to minimize the risk of poor tenant behavior and the one we'll discuss today also protects your property. Security deposits are an effective method for deterring property damage or missed rental payments.

In today's post, we'll explain how security deposits work and give you a few landlord legal tips to prevent any trouble. Keep reading and learn everything there is to know about security deposits.

What Are Security Deposits?

Security deposits are a form of insurance for landlords to protect against poor tenant behavior. By putting security deposits in your rental agreements, you give yourself a financial safety net if a tenant causes property damage or leaves your rental with missed rent payments.

Often, you'll collect a security deposit during a move-in inspection with your new tenant. During this inspection, you'll make note of any existing damage in your rental.

When the tenant moves out, you perform the same inspection, and any new damage is assumed to be from the tenant. You'll then use their security deposit to pay for the repairs.

Security Deposit Laws in California

Every state has unique security deposit rules. In California, landlord-tenant laws state that you can collect a maximum of two months of rent as a security deposit for an unfurnished rental.

As far as what you can deduct from a security deposit, it's exclusively used for unpaid rent, the cost of repairs from property damage, and the cost of cleaning the unit if a tenant fails to do it when they leave. Regular wear and tear is not considered property damage.

Withholding and Returning Security Deposits

It's in your best interest to keep receipts for repairs and proof of nonpayment of rent. When you return what's left of the security deposit, you'll have to provide an itemized list of deductions and their amounts.

Security deposit disputes are common, so it's important to have as much evidence as possible of a tenant's wrongdoing if they try to take you to court. As long as you can prove the lease violation, you'll have nothing to worry about.

When returning a security deposit, you must do it within 21 days of the end of the lease. Failing to do so can result in lawsuits and penalties from the local housing authority.

How Property Management Can Help

Security deposits are the best way to protect yourself from financial loss from your tenants. Dealing with them can still be uncomfortable for many landlords. If that describes you, hiring rental property management might be the best move.

A good property manager, like Penny Realty Inc. Property Management, can handle all security deposit matters, but that's just one service. We can also help you avoid poor tenants with thorough tenant screening and eviction protection. Contact us to learn more about what we can do for your rental.