Security Deposits

Security Deposits Are Necessary

In a perfect world, tenants would always leave their rentals clean and undamaged and landlords wouldn’t have to charge security deposits. But that’s not the real world in which we live. Like other things in life, a minority of irresponsible tenants create a burden for the majority of responsible residents.

security deposit for property rental in Pacific GroveThe good news is that responsible tenants are entitled to receive their deposit back in full. Hence, it is a deposit, not a fee. There is no such thing as a non-refundable deposit in California landlord-tenant law.

The amount of security deposits on the Monterey Peninsula are regulated by California law. A landlord cannot receive more than two months’ rent for an unfurnished home or apartment and no more than three months’ rent for a furnished home or apartment.

What About Last Month’s Rent?

Because it is collected in advance, for the purposes of California law, it is considered part of the security deposit in terms of the maximum amount that can be charged. For example, on an unfurnished home that rents for $2,500, the landlord cannot charge more than a $5,000 security deposit (twice the monthly rent). If the landlord collects the last month’s rent in advance, the largest security deposit he can charge would be $2,500 since the last month’s rent counts toward the legal maximum security deposit.

Gorman Real Estate uses a consistent and – we think – very fair formula for all of our rentals. Recognizing that it can be a hardship coming up with a lot of extra money when you’re moving, we don’t charge last month’s rent in advance. Instead, for those properties with rent in excess of $1,000, we receive a security deposit of one month’s rent plus $1,000. So, for example, if the rent is $2,500, our security deposit would be $3,500 (rent of $2,500 plus $1,000). Yes, it’s still a lot of money, but residents must have something at stake when they move into a home.

Gorman Real Estate has worked hard over the years to develop a reputation for having high-quality, clean rentals. We make sure the home or apartment is clean and undamaged when a new resident moves in, and we anticipate that it will be clean and undamaged when the resident leaves. In most cases the resident receives a full refund of his security deposit and a good reference from Gorman Real Estate.