Home » Bill to Ban Expensive Security Deposits Signed by Governor

Bill to Ban Expensive Security Deposits Signed by Governor

Press Release

by CC News
Assemblyman Matt Haney

Asm Matt Haney’s AB 12 was signed by Governor Newsom. This tenant protection bill stops the practice expensive security deposits.

Sacramento – Assemblymember Matt Haney’s (D-San Francisco) AB 12 was signed by Governor Newsom. This is a landmark tenant protection bill that stops the practice of California landlords charging two times and (in some cases three times) the monthly rent as a security deposit.

California now joins eleven other states in the country to limit security deposits to only one month’s rent.

“Massive security deposits can create insurmountable barriers to housing affordability and accessibility for millions of Californians” said Haney who chairs the California Legislature’s Renters’ Caucus. “Despite skyrocketing rents, laws on ensuring affordable security deposits haven’t changed substantially since the 1970’s. The result is that landlords lose out on good tenants and tenants stay in homes that are too crowded, unsafe or far from work or school. This new law is a simple common sense change that will have an enormous impact on housing affordability for families in California, while also balancing a landlord’s need to protect themselves against potential liability.”

53% of California renters indicate that they are able to afford their rent but they’re unable to get an apartment because they simply can’t afford to pay the two month’s rent as a security deposit. This pushes many families, including those with individuals making minimum wage, to either forgo necessities such as food and utilities or acquire more debt to be approved for housing.

“In California’s high-cost rental market, expensive security deposits are often imposed on immigrants and people of color, effectively limiting access to safe and affordable housing. By capping high security deposits, AB 12 advances a measure of equity and empowers immigrants and people of color across the state, who contribute daily to making our diverse state thrive.” said Masih Fouladi, the Executive Director of California Immigrant Policy Center.

AB 12, which will go into effect on July 1, 2024, will not impact small landlords. Mom and pop landlords that own only 2 properties with a total of no more than 4 units will be exempt. It will also not have any effect on potential liability–landlords will still be able to seek damages from tenants who are responsible for harm to the property that exceeds the amount of the security deposit.

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Note – when Haney introduced the bill, he said the average rent for a two bedroom apartment in San Francisco is $5,000. That means that a tenant could be asked to pay up to $15,000 to move into an apartment. Security deposits are capped at one month’s rent in red and blue states across the country with states as varied as New York, Kansas, Hawaii, and Alabama.

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2 comments

MODERATE October 13, 2023 - 8:31 am

The unintended results will be a further upward pressure on rent prices. “The road to hell… ” goes the saying.

Acres in Virginia October 13, 2023 - 10:19 am

Eviction Moratoriums, Squatter rights, now this. What’s clear to me is that CA really hates landlords and that will no doubt impact the non-homeowners of this state. What was once a lifetime goal now seems like a red-tape hell where the state is allowed to pin you down while near do wells bleed you dry.

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