People often ask how much of a security deposit can they charge on multi family units in California.

The law in California says that you can charge up to twice the monthly rent and up to three times the monthly rent if the unit is furnished.

AS RENTS GO UP, YOUR DEPOSIT WILL PROVIDE LESS SECURITY Over time you should and most likely will raise the monthly rent. Landlords rarely ask for an increased security deposit . For this reason, the unit that you rent today will protect you through one month of unpaid rent, but over time, as rents rise and your security deposit remains the same, it will be less and less than a  months rent. Have you ever had a tenant move out where the rent was $1,000. and the security deposit was $500. or less?

YOU WILL BE DEDUCTING DAMAGE, CLEANING AND REPAIRS FROM THE SECURITY DEPOSIT. When you do refund the deposit, you will deduct any costs associated with getting the unit in rent ready condition, as it was when you rented it. If the costs exceed the security deposit, you can go after the former tenant, but that can be quite difficult and time-consuming.

COMPETITIVE RENTAL MARKET In this rental market, there is a lot of competition for vacant units. That being said, why not protect yourself and your investment by getting the maximum security deposit? It is much easier to get an additional deposit prior to move-in than afterwards.

UNPLANNED OCCURRENCES We landlords got a rude awakening with COVID and many  lost significant amounts of income. A larger deposit wouldn’t restore all the losses, but in may cases, it would have helped. We are still not completely out of this pandemic and no one can predict the future, so, hopefully, we can make changes that will benefit us down the line.

What we at PRS PROPERTIES CAN do for you, is give you an idea as to what other owners are doing with their security deposits. We can look at your rent roll to see how you stand currently. We can also look at your building for other small changes could allow you to get a higher value than you may have thought. We can help you to get the maximum value for your property, should you decide to sell, or the maximum return if you are planning to keep your building.

We have many investors who are looking for “off market” properties and we have put together many, many transactions which involve properties that are not listed for sale.

We can also put together an aggressive campaign if you decide to put your property on the market. We have been doing this for over 40 years, and we will use all the tools available to bring you the most dollars at closing. If you are thinking of selling or are just curious about the value of your property, don’t hesitate to give us a call.