Decorative imageJUNE 2024

California’s New Security Deposit Law

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Starting July 1, 2024, Assembly Bill 12 will reshape how security deposits are handled. With a new cap set at one month’s rent, this legislation is designed to streamline and simplify rental practices across California. Stay ahead of the curve and ensure your properties are compliant with these upcoming changes.

Key Takeaways For Property Owners

Here are the essential points you need to know about CALIFORNIA’S 30-DAY LIMIT ON SECURITY DEPOSITS Security deposit cannot exceed one month’s rent. No refunds needed for deposits received before July 1, 2024. ADVANCE RENT PAYMENT Six months or more advance rent allowed for longer leases (considered rent, not a security deposit). NO ADDITIONAL DEPOSITS Pet, key or other deposits not allowed if total exceeds one month’s rent. RENTAL EXEMPTION An owner who rents two dwellings must be a natural person, family trust or LLC with all members as natural persons. No more than four rental units in total.

As a valued member of our community, we encourage you to review these changes and adjust your rental practices accordingly. Staying compliant ensures a smooth transition and continued success in managing your properties.

New pet bill clears assembly - What's Changing

The recently proposed Pet Bill has successfully cleared the Assembly and is now progressing towards the Senate. This piece of legislation has undergone significant revisions during its passage. It's vital for property owners like yourself to stay updated on these changes, as they may impact your property management practices and tenant interactions. Keeping abreast of these developments will ensure you remain compliant and informed.

THE PET BILL (AB 2216) OVERVIEW - Fees: $50/month pet rent for additional pets, security deposit up to 50% of rent or $1,000 - Applies: Monthly pet fee ensures required proof before pets move in- Properties with 15 or fewer units - Limits: One pet for properties with 16+ units, smaller properties can restrict pets - Applicability: Not for existing or renewed leases unless agreed

What This Means for You:

As property owners, it’s essential to review our current pet policies and make necessary adjustments to comply with the new regulations. Here are a few steps to consider:

  • Update Lease Agreements: Ensure that your lease agreements reflect the new legal requirements regarding pet policies, fees, and damages.
  • Inspect and Document Property Condition: Regularly inspect your properties and document their condition to manage and justify any pet-related damage claims effectively.
  • Educate Your Tenants: Inform your tenants about the new pet policy changes and their responsibilities as pet owners. This can help mitigate potential issues and promote harmonious living arrangements.

Stay Informed and Engaged:

As this bill progresses through the Senate, we'll continue to provide updates and resources to help you navigate these changes. Being proactive will ensure compliance and foster positive relationships with your tenants.

If you have any questions or need assistance with updating your pet policies, please feel free to reach out. We're here to help!