Property Management Blog

Allowable Security Deposit Deductions


Bob Preston - Saturday, October 20, 2018
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Landlords and tenants alike will often ask what is allowable as a security deposit deduction at the conclusion of a tenant’s lease agreement. Some aspects of California law are quite clear on this topic, others are a bit hazier.

Clear:

According to California Civil Code § 1950.5(b)(2), when a tenant terminates their lease and vacates the property, the landlord can deduct costs incurred to repair damages caused by that tenant as a charge and deduction from the tenant’s security deposit.

Hazy:

According to the same California Civil Code § 1950.5(b)(2), these charges can only be taken for damage beyond ordinary wear and tear. 

So, herein lies an important question regarding security deposit deductions …. what does “normal wear and tear” mean? 

From my experience, common sense judgment should rule the day. Sometimes I’m in the difficult position of having to explain this to both the tenant and the landlord. The security deposit cannot be used for repairing property defects or deterioration caused by normal daily life at the property. The security deposit also can’t be charged for any conditions if they existed at the time that the departing tenant moved in or if a property item is beyond its “useful life”.  Another good rule of thumb is the measure of obvious neglect, misuse, or abuse that may have led to property damage which would be cause for security deduction.

Applying my “common sense rule” to the above, maybe these examples will help: 

  • Matting of carpet in high traffic areas or small stains in select areas is wear and tear; Burned or badly stained carpet is damage. 
  • Small nail holes where pictures were hung are wear and tear; large holes or areas cut open in the walls is damage. 
  • Smudges and scuffs on walls are wear and tear; large stains or permanent stickers applied on the walls is damage.

Looking to an official government source, the U.S. Department of Housing and Urban Development (HUD) weighs in on this topic on pages 55 and 56 of a document titled Special Claims and Processes Guide (June 2006) which can be found at this link: https://www.hud.gov/sites/documents/HSG-06-01GHBGUID.PDF

According to HUD, Tenant damages usually require more extensive repairs and at a greater cost than normal wear and tear and are often the result of a tenant’s abuse or negligence that is above and beyond normal wear and tear. To summarize the HUD guidelines, please consider this table:


NORMAL WEAR AND TEAR

TENANT DAMAGE

Small nail holes, pin holes, natural cracks in wall, small chips in plaster

Gaping holes, large holes from bolts or anchor screws, areas where walls were cut open or large dents in plaster

Fading, peeling, scuffed, or cracked paint/wallpaper

Drawings, decals/stickers, crayon markings on walls or unapproved paint/wallpaper 

Doors sticking or not closing properly due to age or humidity

Doors removed or ripped from hinges

Cracked window pane from settling of building

Broken Window

Carpet faded or worn thing from walking

Carpet burns, large stains, or pet damage 

Small scratches in wood flooring in select areas 

Gauges in wood flooring or excessive scratches throughout from pet damage

Loose grouting and bathroom tiles

Cracked or missing bathroom tiles

Worn or scratched enamel in old bathtubs, sinks or toilets

Chipped, broken, or cracked enamel in bathtubs, sinks, and toilets

Partially clogged or slow draining sinks and toilets

Clogged or damaged sinks and toilets from improper use and care

Faded, worn or yellowing lamp or window shades

Torn, stained, or missing lamp and window shades

Rusty bathroom fixtures or shower rod

Missing, damaged fixtures and shower rod


These types of decision can easily become the genesis of a tenant and landlord dispute. Because of this, many owners of rental homes leave these matters to professional property managers like North County Property Group. We've seen a lot, can make good recommendations, and work with both the tenant and owner for logical and reasonable interpretation of security deposit laws. Call us today to learn more about our property management services and programs!



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