Security deposits continue to be one of the most misunderstood topics in California property management. Laws have changed in recent years, and even experienced landlords and real estate professionals can be caught off guard by the details.
Whether you manage rental property, represent investors, or simply want to stay current, this quick 10-question quiz is a great way to test your knowledge.
Security Deposit Quiz
1. On a furnished unit with no exceptions today the maximum security deposit is ______________.
2. Security deposits must be kept in a trust fund account. True or False
3. Security deposits after legitimate deductions must be returned within __________ days.
4. A single individual who owns __________ or fewer residential rental properties may qualify for an exception allowing a two-month security deposit.
5. When a tenant moves out, costs to repair damages can be deducted but not costs for _________.
6. Receipts must be furnished to deduct damages if they exceed __________.
7. A tenant requests an inspection and a listing of “damages”, the inspection must be held ________ days before move out.
8. If an owner acts in “bad faith”, a court could allow a penalty of up to _________ times the deposit.
9. If the work can’t be finished in 21 days, the owner must give a ___________.
10. California’s security deposit laws are found in Civil Code Section __________.
ANSWERS:
1. One month, new Bill AB 12, effective July 1, 2024
2. FALSE
3. 21 days
4. 2
5. Ordinary wear and tear
6. $125
7. 20 days
8. 2
9. good faith estimate
10. 1950.5
A Few Interesting Facts from California Civil Code Section 1950.5
Here are a couple of provisions that many landlords and property managers overlook:
- Advance Rent: The law does not prohibit a landlord from collecting six months’ rent in advance if the lease term is six months or longer.
- Owner-Performed Repairs: If the landlord performs the repair work personally, the itemized statement must reasonably describe the work completed and include the time spent and the reasonable hourly rate charged.
Interested in learning more about California property management?
If you’d like to see additional Property Management classes or educational programs from Duane Gomer Education, simply reply to this email and let us know what topics you’d like us to cover.Duane Gomer, CPM
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