.State lawmaker proposes security deposit cap

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Most renters know securing housing isn’t as simple as finding the perfect place.

California’s renters must save up thousands of dollars to provide security deposits that can legally be as much as two months’ rent, or three months’ rent for furnished units.

Add in the requirement that renters put up the first month’s rent before they can move in and low-income families are most likely to give up hope of finding a home.

The state Assembly on May 22 passed a proposal that could change that.

Assembly Bill 12 would limit security deposits to one month’s rent, regardless of whether a unit is furnished or not. If the bill passes and gets Gov. Gavin Newsom’s signature, California could become the 12th state to limit security deposits.

“Security deposits present barriers for people to move into apartments, which can lead them to stay in apartments (and) in homes that are too small, crowded or even unsafe,” said Matt Haney, the assemblymember from San Francisco who authored the bill. “In other cases, people take on debt or financial burden that leaves them unable to afford other necessities.”

Haney said the bill has attracted widespread support in the Assembly, including from lawmakers who are landlords, as well as from labor organizations representing teachers, nurses and grocery store workers.

Assemblymember Diane Dixon, from Newport Beach, was among the Nos in the 53-14 vote. She cited concern about the bill’s potential to reduce the housing supply.

“The more we over-regulate people’s ability to offer a successful product, the scarcer it will become,” she said in a statement. “Landlords charge security deposits to cover potential damages and any unused funds are returned to the renter.”

Haney said the issue caught his attention when a janitor in his district described living with his wife and three children in a one-bedroom apartment.

“He wanted to move into a larger unit so his kids didn’t have to sleep in the same room as him and his wife,” Haney said. “He said he could afford the rent, but he couldn’t afford the deposit and first month’s rent to move in. Unfortunately that’s not an uncommon situation.”

In California, the median rent for a two-bedroom apartment is $2,538 and for a three-bedroom home is $3,795, according to Zillow. For a $3,000-a-month unfurnished unit, a landlord can charge as much as $9,000 for a security deposit and the first month’s rent.

“People are being asked to pay the equivalent of the down payment of a home in many parts of the country just to move in,” Haney said. “It’s really untenable.”

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