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Changes regulating security deposits for Philadelphia tenants and landlords approaching legislative approval
Philadelphia's City Council has shaken things up with two new housing bills, set to become law soon! Here's the lowdown on these upcoming changes for both renters and landlords.
New Security Deposit Rules for Renters:
Current Pennsylvania state law prohibits landlords from charging more than two months' security deposit during the first year. In the second year, they can hold only one month's security deposit. The proposed city law, however, imposes more lenient terms for landlords managing three or more units. These landlords who currently charge more than one month's security deposit will now allow renters to pay it in three equal installments starting from the lease's commencement.
For instance, a landlord charging three months' security deposit for an $1,500-per-month apartment will have to accept $3,000 upfront, followed by $2,000 in the second month and the remaining $1,500 in the third month. In sum, renters will still have to pay the full amount, but the financial load will be more manageable by spreading it out over three months.
Rental Application Fee Updates:
Under the proposed law, landlords in Philadelphia are barred from charging more than $50 for application fees. If these costs fall below $50, landlords can recover the actual cost of these background and credit checks.
Enforcement and Complaint Processes:
This new law will only apply to new lease contracts and will not be retroactive to existing leases. If a tenant feels their landlord is violating the law, they can file a lawsuit seeking damages or, alternatively, file a complaint with the Philadelphia Fair Housing Commission.
Expenses for Tenants with Pets:
It's crucial to note that neither the proposed law nor the existing regulations address other possible move-in costs, like nonrefundable pet fees and pet rent.
Impact on Renters and Landlords:
According to U.S. Census Bureau data from 2018-2022, about 48% of Philadelphia households are renters, with more than 55,000 landlords across the city. While most of these landlords are small-scale property owners with two or fewer rental units (73%), some 25% operate three to 24 units. These larger landlords will be the primary focus of the new law's installment payment plans for security deposits.
The bill was sponsored by Councilmember Rue Landau, a housing law attorney. Landau argues that these changes will ease financial burdens for low-income renters, ensuring they can move into clean, safe living environments without facing undue financial hardships.
More on Philly's Housing Laws:
- Learn about fair housing laws in Philadelphia.
- Discover resources to help first-time home buyers in the city.
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The new housing policies in Philadelphia, as proposed by Councilmember Rue Landau, offer adjustments in the security deposit rules and rental application fees, reflecting policy-and-legislation changes that are expected to have an impact on both renters and landlords. The more lenient security deposit terms for landlords managing three or more units will enable renters to pay the deposit in three equal installments, alleviating financial burdens. At the same time, the proposed law caps rental application fees at $50, affecting the costs landlords can recover for background and credit checks. As the enforcement and complaint process unfold, politics and general news will continue to be relevant, following the fluid landscape of housing laws in Philadelphia.
