New California Landlord Laws: What You Need to Know

As of January 1, 2025, several new laws affecting landlords in California have come into effect, aiming to enhance tenant protections and promote transparency in rental practices. Key changes include:

1. Tenant Screening Procedures (AB 2493):

• Application Fees: Landlords can charge a potential tenant an application screening fee only if they accept applications in the order received and approve the first applicant meeting the established screening criteria. We have always done this at Management One so this does not affect us.
• Disclosure of Criteria: Landlords must provide their screening criteria in writing alongside the application.

2. Security Deposit Documentation (AB 2801):

• Photographic Evidence: Landlords collecting a security deposit are required to take photographs of the rental unit:
• Immediately before, or at the start of the tenancy.
• Within a reasonable time after the unit is returned, prior to any repairs or cleaning for which deductions from the security deposit will be made.
• After completing any repairs or cleaning.

         Provision to Tenants: These photographs must be provided to the departing tenant.

• Implementation Dates:
• For tenancies ending on or after April 1, 2025, landlords must take photographs after possession is returned.
• For tenancies beginning on or after July 1, 2025, landlords must take photographs at the start of the tenancy.

3. Positive Rent Payment Reporting (AB 2747):

• Offer to Tenants: Landlords of residential rental properties are required to offer tenants the option of having their positive rental payment information reported to at least one nationwide consumer reporting agency.

         Frequency of Offer:

• For leases entered into on or after April 1, 2025, the offer must be made at the time of the lease agreement and at least once annually thereafter.
• For existing leases as of January 1, 2025, the offer must be made no later than April 1, 2025, and at least once annually thereafter.

4. Rental Payment Methods (SB 611):

• Fee-Free Options: Landlords must offer at least one fee-free method for rent payment, ensuring residents are not charged additional fees for valid check payments, even if electronic methods are preferred. Should you have any properties that aren’t managed by Management One, take note of this as it will affect you.
• Military Personnel Considerations: Landlords are now required to provide explanations when requesting larger security deposits from military personnel.
• Prohibition of Posting Fees for Notices: Landlords are now prohibited from charging tenants any fees for the preparation, delivery, or posting of termination notices, such as a 3-Day Notice to Pay Rent or Quit. This change eliminates additional financial burdens on tenants facing potential eviction and encourages equitable treatment in the landlord-tenant relationship. It is important to note that this adjustment presents significant operational costs for landlords and property management companies, including labor, transportation, and fuel expenses related to notice delivery.

Management One is in the process of updating its practices with our landlords to ensure full compliance with the new regulations.

Resident Screening Procedures (AB 2493)

For the last 40 years, Management One has accepted applications on a first come-first serve basis. We believe this is the fairest way to rent properties and remain above board with Fair Housing.

Security Deposit Documentation (AB 2801):

We currently take photos for all resident security deposit charges and provide them to the departing residents. Effective April 1st, 2025, we will start taking additional before and after photos to be in compliance with the new law. This takes a lot of  additional labor time to comply with this law as well.

Positive Rent Payment Reporting (AB 2747):

We currently use an online payment platform that offers residents the option to have their rental payment history reported to their credit.

Rental Payment Methods (SB 611):

Fee-Free Options: We currently allow residents to pay by cashiers check or money order along with paying online.

Military Personal Security Deposit– the law already only allows for Management companies and landlords to collect a security deposit equal to one-months rent, so we don’t have to worry about this.

Termination notice fees: We currently charge the resident a $100 posting fee for 3-day notice to pay or quit. Effective April 1st, Management One will charge the landlords $75 posting fee and Management One will take a $25 loss.

We are committed to working closely with our legal counsel to ensure that Management One and our clients remain fully compliant with new laws and Fair Housing regulations.

As legislation evolves, we will continue to provide timely updates to keep you well-informed and prepared.