California’s rental laws are constantly evolving, and AB 2801 is the latest bill to impact how landlords and tenants handle security deposits. Whether you're a renter looking to understand your rights or a property owner adjusting to new regulations, these changes could significantly affect the leasing process. Here’s what you need to know about AB 2801 and its impact on California’s rental market.
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Hey! There's new security deposit laws in California here's what you need to know!
Welcome back inside Uplift Property Management I'm CEO Tommy Perfect and I am really excited to share with you a little bit about the new California law AB2801, it's all changes to the security deposit uh handling and how we can do that as a landlord.
So under our current existing regulations under California civil code you know we have our normal security deposit you know you go in you inspect the unit you see what's wrong you can tell the tenant what damages are there we already have a little bit of provisions behind that but then what we do is you go and you just charge the security deposit for whatever repairs or damages there were and you send your invoices along with it. So that's kind of where we go with these security deposits right now but AB2801 is really just switching that up a little bit and requiring a lot more evidence from you the landlord to prove the value of those charges to the tenant.
The biggest hurdle that you're going to see with this new law here in California is that you're going to have to take a lot more photos now, we already take photos all the time move-in photos, move out photos all those things are great if you're a good property manager a good landlord you're already doing these things this really just codifies some of those requirements so one mandatory move-in inspections you can't just leave it on your tenant anymore to do those inspections for you anymore you really have to go in and have your own date time stamped photos at move-in. Then of course at move out you're going to take and document all of those issues that were there at the property all of those tenant caused damages a real show of the condition of the unit and now the third step the third round of photos now is that you're going to have to take photos of the actual repairs completed and send those along with the itemized statement and invoices for that security deposit disposition for the tenant.
Really important right now for property managers and landlords is this starts going into effect April 1st 2025 that's just a few weeks away right now for all of your moveout photos and those third step those repair photos for your existing tenants so all of those moveouts that happen on or after April 1st 2025 you need to have those date timestamp photos at move out and of completed repairs the movein photo requirement will be established for all new tenencies as of July 1st 2025 so make sure you remember those dates and stay compliant.
I know some of you guys are out there thinking "Oh every time that a tenant moves out you're going to be able to charge for cleaning." Well this really takes away that automatic cleaning fee that any landlord or property manager might have it really makes it specific that you can't just say "Oh yeah no matter what you're going to get charged for cleaning." Now you and I both might know that the tenants never really leave it all the way clean so you can still charge a cleaning fee as long as you are actually returning the property to the initial status and condition when the tenant received it so if you had it professionally cleaned when they moved in you can then charge to make sure that it's professionally cleaned when they moved out or the tenant has that opportunity to pay a professional cleaner to hit those initial conditions when they moved in.
The days of automatically charging for carpet cleaning or automatically charging for cleaning the the house or apartment are long gone those are in the past and we got to move forward under these new regulations one of the lesserk known things that's already part of California landlord tenant law is that the right to an initial inspection or we call it a pre moveout inspection this inspection happens 14 days prior to the tenant moving out now there are some really specific requirements when this happens and it is optional you as a landlord must offer it to the tenant but the tenant has the option to take you up on it if they do take you up on that initial or pre-moveout inspection there are some specific requirements that you need to follow as the landlord.
First off you need to provide an itemized written statement of the potential damages that the tenant may be charged for now that kind of fits you into a box right? you have to get everything on that statement so that you can charge it or if they have personal belongings that are in the unit that are preventing you from being able to see the damage, then you can still charge for those or damages that occur in between that initial inspection and the move out date.
This law changes a little bit when a unit is entirely empty if they've already vacated and they still want that pre-move out they still want to hold possession of the unit so they can make those repairs you have to get all of those things into that statement and give the tenant a chance to cure those damages before you're able to charge their security deposit.
In conclusion AB 281 big thing on photos three stages of photos move in move out after repair got to have it it's required got to start doing that second, no more mandatory cleaning fees and then lastly, changes to those um initial inspections and giving that photo evidence to the tenant that documentation to the tenant to really prove the charge and prove the value that you actually had caused in damages so you got to make sure that we keep up on these laws and you know feel free to call Uplift if you have any questions regarding this and we're happy to help you walk you through these security deposit questions and the pain points that happen.
AB 2801 is another step toward tenant-friendly rental policies in California. While it introduces new challenges for landlords, it also provides clarity and consistency in security deposit handling. Staying proactive and informed is key to navigating these changes successfully.
At Uplift Property Management, we help landlords stay ahead of California’s evolving rental laws. If you need guidance on how AB 2801 will impact your rental property, contact us today—we’re here to help you adapt and thrive!
New legislation is turning the rental industry on its head! California's AB 12 brings significant changes to security deposit rules, affecting both renters and landlords.
In this video, we take apart what the new legislation means, how it will impact rental contracts, and what you have to do in order to remain compliant. As a property owner or renter, these updates are crucial to understand!
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Welcome back Inside Uplift Property Management! I'm Tommy Perfect CEO and broker here at Uplift and today we want to do a legal update on California Assembly Bill 12 all about California security deposits.
So what AB12 really is it's talking about limiting what you can take as a security deposit and really if you haven't already started implementing this in your business or in your rental property you are really behind because it went effective July 1st of 2024 what the gist of the bill is is it's going to prohibit a landlord from taking more than one month's worth of rent as a security deposit and they actually use the term "Securities" and that includes all fees or charges outside of the security deposit that are going in advance of the rent with a couple exceptions that we can talk about but it also covers furnished and unfurnished units so here's those exceptions.
First off you have to be a natural person or an LLC where all the owners are natural persons that means you or me not a corporation that actually owns a property right you also are limited on the unit count so you can have two properties not making up a total of more than four rental units so if you own a duplex and you also own a Triplex that's five units and those are all rented out units you are not qualifying for that exception but if you just have a single family home that you own it as a natural person person then you are able to still charge up to twice the month the A month's worth of rent as a security deposit.
Now going into all of those other charges what they are calling Securities right this includes any additional deposits like if you have an HOA that requires you to have a key deposit or something that you have with them or pet deposits which pet deposits are a struggle already cause you limit what you are allowed to charge to that deposit so that's an additional deposit so all of those kind of things are those additional Securities that are going to be calculated in to the one month's worth of rent requirement or the 2 months worth of rent requirement if you qualify for that exception so essentially if your rent is $2,000 a month your security deposit can only be $22,000 a month if you also have a tenant that has a pet and you want to charge a pet deposit well really you're still capped at that $2,000 one other exclusion to this is active service members they are still only at that one month's rent even if you are a natural person that qualify for the exception the active service Duty members still it's one month's rent no matter.
What long gone are the days that you are able to collect first month's rent a security deposit and last month's rent this bill actually changes the last month's rent in a legal sense so really you can only charge first month's rent in that security deposit you which I highly recommend you charge the first month's rent when you charge it don't PR rate when you start charge the full first month's rent and the security deposit if you do qualify for that exception you can charge that last month's rent but you might as well just call it a security deposit and increase that security deposit up to that two times amount if you're qualifying for that exception what the law is actually saying is that when you have that last month's rent it is included in that term Securities right? so you can't actually charge that because essentially you're going to have to hold that just as if you're going to hold a security deposit but then you limit it to that you know use for only the the rent at the end of the tenency there is one exception to the last month's rent cause you know these bills can't be just straightforward but if you charge 6 months or more of rent that is your prepayment so if you have somebody that comes along and they say "hey I really want to rent it out I want to pay you 3 months in advance" that's actually technically against the law now you have to have a minimum of 6 months in advance when you're going to collect that as security for your lease.
In conclusion, you've got AB12 limits you to one month's rent that's really the best practice you're going to find that you're going to be more competitive on the market if you aren't trying to increase that security deposit when we have this changing Market a cooled off Market rentals are a little bit longer to get rented right now your renter is going to expect to have the security deposit be one month's worth of rent and stopped at that again remember any additional deposits are included in that calculation for AB12 and your total amount that you can do and then you can't charge that last month's rent anymore so thank you and if you have any other questions feel free to reach out to us here at Uplift we're always happy to go over these little updates and make sure that everybody can push the industry forward and we can all be good landlords going forward.
California's AB 12 is a game-changer in rental legislation, limiting security deposits to make housing more affordable for tenants and demanding that landlords change their leasing procedures. From property owners dealing with compliance to renters learning your rights, being in the know is the secret to a painless rental experience.
At Uplift Property Management, we're here to help landlords navigate these changes and offer a seamless leasing process. If you have any questions about AB 12 or need expert guidance, reach out to our team today—we're more than happy to assist!
