California AB 12 – Security Deposits

SECURITY DEPOSIT LAW AS OF JULY 1, 2024

In 2023 the governor signed AB 12, an act to amend, repeal, and add a section to California Civil Code 1950.5, which governs security deposits statewide. These changes go into effect on July 1, 2024.  

• “Security,” as used in CC 1950.5, means any payment, fee, deposit, or charge - except for application fees – imposed at the beginning of tenancy as advanced payment of rent or to cure defaults, damages, or cleaning (for tenancies established on or after January 1, 2003) upon lease termination.  
• The change is not retroactive; leases executed before July 1, 2024, are unaffected.  
• No more differentiation between furnished and unfurnished units. 
• If you accept advance payment of rent, the lease term must be six months or longer, and the payment for no fewer than six months. 

As of July 1, 2024, security deposits will be capped at one month’s rent for most owners statewide. This deposit ceiling includes any deposit charged for pets or keys, and advance payment of rent. Thus, you can not require additional pet deposit or last month's rent.