What Do Landlords Need to Know about Security Deposits?

What Do Landlords Need to Know about Security Deposits?

Rents in Jacksonville are rising faster than in most of the rest of the country. As a result, security deposits are rising as well. New landlords may feel nervous about this, as they may not know if those deposits are fair to tenants.

What are security deposits for, anyway? Are they really helpful? How much should you charge in this era of rising rents?

Read on to learn the answers to these questions.

What Is a Security Deposit?

A security deposit is a payment made by a tenant to a landlord to cover any potential damages or unpaid rent when they move out of a rental property. It's a common practice in the rental industry and serves as a form of protection for the landlord and the tenant alike.

These deposits are typically paid by tenants at the start of a rental agreement, and it's usually equal to one or two months' rent. The landlord holds onto it for the duration of the tenancy and they give it back when they move out as long as they've fulfilled their obligations under the rental agreement.

How Much Should Security Deposits Cost?

In the state of Florida, there's no limit on what landlords can charge for a security deposit. However, with this in mind, you need to be smart about it.

Most landlords charge between one and two months' worth of rent for a deposit. Any more than this and it's unlikely you'll have tenants lining up to rent with you.

In some cases, charging more may be appropriate. For example, if a tenant may not meet all of your qualifications perfectly, or if you accept tenants with poor credit. Charging less can also be effective if you're trying to fill a long-term vacancy.

Do You Have to Return Security Deposits?

Landlords must return security deposits in most situations. In Florida, they must return the deposit within 15 days of the tenant leaving.

As long as the tenant has no outstanding rent payments and the property was left in good condition, they get the deposit back. Tenants are not responsible for any repairs or maintenance that result from normal wear and tear. They are only responsible for legitimate damage.

Landlords should only take the money they need for repairs out of the deposit. For example, if the deposit was $1,600, but the repairs only cost $500, the landlord can only take $500.

Landlords should provide an itemized receipt if they are taking any portion of the security deposit to cover maintenance and repairs. Tenants have the right to contest this.

Security Deposits Are Simple

Security deposits may seem complicated, but they're not. All renters already understand that they'll have to pay a deposit, so don't worry. Remember, the deposit benefits both you and the tenant.

Are you a Jacksonville landlord who's looking for a helping hand? PMI Jacksonville is here to save the day. Our team of experienced property managers can help with tenant placement, lease enforcement, rent collection, and so much more.

Schedule a free consult with us today to get started.