A.D. Cantelmo Property Management
Our Business is Property Management Orange County California
a Security Deposit
with security deposit issues is one of the more difficult decisions a Property Manager
or Landlord has. Obviously a Tenant wants all their security deposit back and
the Landlord wants to make sure their property is move in ready for the next Tenant. As a Property
Manager, sometimes it seems we are in a vice being squeezed from both sides.
How much of a security deposit to return is not always cut and dry, in fact most
of the time it’s very difficult and creates animosity. So
the question is, how do you minimize problems regarding security deposits.
Who’s Money is it?
When it comes to a security deposit, the
question is, who’s money is it? To me, there are two answers to that question.
First, a security deposit is a refundable deposit. In California, there are no
non refundable deposits and that includes Pet deposits. With that in mind, I
believe the Security Deposit belongs to the property owner with the
understanding that it may be temporary. I always, transfer a security deposit
to the property owner, unless the owner wants me to keep it. When I transfer
the money to the owner, I remind them that some or all of the security deposit
may have to be returned to the Tenant at the end of their tenancy. It is very
important for an owner to think of a security deposit as an insurance policy.
You should keep that money in a separate account only to be used if a Tenant
damages or leaves property in a state of disorder.
What can a Security Deposit be
A security deposit can be used for several
reasons. When a Tenant moves out of a property, that Tenant does not leave
the property clean. In my experience, this is the main reason for a deduction
of a security deposit. When Tenants are moving, things can get hectic, so
Cleaning is left as the last thing on the list to do and often times a Tenant runs
out of time and leaves the property before cleaning is done. A Landlord may
deduct for cleaning fee’s.
Next is damage to the property. I don’t run
into this too often, but sometimes there is damage to a property. It may be a
pet that chewed the baseboards, or removing a TV brace without patching and
painting the holes in the wall. For this type of damage, a Landlord may deduct
for damage repair.
When it comes to carpet or paint, that all
depends on how long the carpet has been on the floor and how long It has been
since the home has been painted. This is where the term “Normal wear and tear”
comes in. There are no hard and fast rules on lifespan, but here are my guidelines
PAINT 3 YEARS
CARPET 5 YEARS
WINDOW COVERINGS 5 YEARS
VINYL FLOORING 7 YEARS
STOVES 7 YEARS
REFRIGERATORS 7 YEARS
Now, if a Tenant lives in a property for 2
years, and you feel that the paint has been damaged, you can’t charge them for
a new paint job, you must prorate how much they owe by calculating the lifespan of the paint job
and how long they have lived in the property. For example, if a new paint job
is $1000.00 and the life of that paint job is 3 years and the Tenant has lived
there 2 years, you can only charge for 1 year of the life of the paint job
which would be $333.00.
The same goes for anything else you deduct for.
Remember, a Landlord can withhold from the security deposit only the amount
reasonable and necessary.
Try and think of it this way, if the Tenant took
you to court, how would a Judge rule and keep in account that Judges when it
comes to security deposits lean in the Tenants favor much of the time. So
always make sure you document with pictures of before and after and receipts of
When it comes to security deposits, it is
always going to be contentious. Tenants always feel they have left the property
the same way they moved in and Landlords want the property to be ready for the
next Tenant without having to spend any money. Most of the time, we can come to
a reasonable agreement where both sides give a little. Just make sure that when
you do the initial walk through and the pre-move out inspection, everyone knows
what is expected.
A.D. Cantelmo Property Management
Specializes in Property Management Orange SOUTHERN CALIFORNIA