California bill aims to limit renters’ security deposits

California bill aims to limit renters’ security deposits

As apartment rental prices increase across California, so have security deposits. Now, a bill aims to change that.

Assembly Bill 12, introduced by San Francisco Democratic Assemblymember Matt Haney, seeks to cap the cost of security deposits as part of a broader effort to make housing units more affordable statewide.This is what a $1,500 rental budget will get you in California

The increasing cost of security deposits is partially due to a California law allowing landlords to charge up to three months’ rent as a security deposit, plus the first month’s rent.

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In Los Angeles, where the median rent for an apartment is $2,260, a security deposit can cost nearly $7,000. In San Francisco, where the median rent is $3,595, security deposits can cost more than $10,000.

Should the bill pass, security deposits would be limited to only one month’s rent. California would be the 12th state to pass a bill that limits security deposit requirements.

New York, Alabama and Hawaii are among the few states that have passed similar legislation.

“When renters can’t afford deposits, they often have to borrow from predatory lenders, go into debt, or just stay put,” Haney said in a statement.

“Landlords lose out on good tenants and tenants stay in apartments that are too crowded or have unsafe living conditions. Creating a rental deposit cap is a simple change that will have an enormous impact on housing affordability for families in California.”A record number of Californians moved to Texas in 2021, study finds

However, not everyone is on board with the proposal.

The California Apartment Association previously released a statement saying that its “renewing its opposition to a bill headed to the State Senate that would cut the maximum security deposit landlords can charge to a single month’s rent.”

Debra Carlton, executive vice president of state public affairs at CAA, wrote an opposition letter to Haney saying that the bill would limit “a property owner’s ability to financially cover property damage or unpaid rent is an unfair imposition for rental housing provider.”

AB 12 passed the Assembly in May and is now being considered by the State Senate.

Should it pass both houses, it would go to Gov. Gavin Newsom to either sign or veto.

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