As of January 1, 2025, several new California laws will impact landlords and property managers. Here's an overview of these legislative changes:
1. Application Process Overhaul (AB 2493)
AB 2493 further pushes landlords to accept a "first come, first served" approach to rental applications, aiming to enhance fairness and transparency. The "strongest applicant" approach is not outlawed, but landlords doing so will not be allowed to collect application fees. Key provisions include:
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Written Screening Criteria: Applicants must receive the screening criteria alongside the application.
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Application Fee Protocol: Fees should only be charged when an application is under consideration. If multiple applications are processed simultaneously, any fees collected inadvertently must be refunded within seven days.
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Credit Report Access: Applicants denied tenancy must be provided with a copy of their credit report, regardless of whether they request it.
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Fee Receipts and Refunds: Landlords are required to issue receipts detailing application processing costs and refund any unused portion of the fee to the applicant.
2. Security Deposit Deduction Documentation (AB 2801)
AB 2801 introduces stricter documentation requirements for security deposit deductions:
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Photographic Evidence: Effective April 1, 2025, landlords must provide before-and-after photos for any claimed damages. By July 1, 2025, this extends to include photos taken before tenant occupancy.
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Prohibition of Automatic Cleaning Fees: Lease agreements cannot stipulate fixed cleaning charges. Deductions for cleaning are permissible only when necessary to restore the property to its original condition, accounting for normal wear and tear.
3. Termination Notice Fee Ban (SB 611)
SB 611 prohibits landlords from charging tenants' fees for the preparation or service of termination notices, such as 3-Day Pay or Quit Notices.
4. Expanded Rent Payment Options (SB 611)
Landlords are now required to accept rent and security deposits in at least one form other than cash or electronic funds transfer, providing tenants with more flexibility in payment methods.
5. Security Deposit Regulations for Military Tenants (SB 611)
For military service members, if a landlord requires a security deposit exceeding one month's rent, they must provide justification for the additional amount. Furthermore, any amount exceeding one month's rent must be refunded within six months if the tenant consistently pays rent on time.
6. Extended Response Time for Tenants Responding to Eviction Notices (AB 2347)
Tenants now have 10 days to respond to an eviction notice, instead of 5 days as previously allowed.
7. Raised Limit for Handymen (AB 2622)
Unlicensed handymen are now allowed to take jobs up to $1,000, instead of $500 as previously allowed.
8. Landlords Must Offer Credit Reporting (AB 2747)
Properties with fewer than 15 units are exempt, but for those with 16 or more units, the lease must offer an option to report a tenant's positive rental history to at least one consumer reporting agency.
9. Landlords Must Rekey Locks After Domestic Violence Incidents (SB 1051)
If a tenant adequately documents an incident of domestic violence, the Landlord is required to change the locks not later than 24 hours at the landlord's expense.
Recommendations for Landlords:
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Update Lease Agreements: Ensure all lease documents reflect these new legal requirements.
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Revise Application Processes: Implement a sequential application review system and provide clear, written screening criteria to all applicants.
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Enhance Documentation Practices: Begin taking date-stamped photos before tenant occupancy, after move-out, and post-repairs to comply with AB 2801.
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Adjust Fee Policies: Remove any provisions that charge tenants for termination notices and ensure application fees are handled in accordance with AB 2493.
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Diversify Accepted Payment Methods: Offer multiple payment options beyond cash and electronic transfers to accommodate tenant preferences.
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Special Considerations for Military Tenants: Be prepared to justify any security deposits exceeding one month's rent for military service members and adhere to the refund timeline stipulated by SB 611.
Staying informed and compliant with these legislative changes is crucial for effective property management in California. For more detailed information, refer to the official legislative texts or consult with a legal professional specializing in landlord-tenant law.
