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Published July 13, 2026
In El Segundo you can charge one month's rent as a security deposit. Not two. The old two months unfurnished rule died on July 1, 2024. You have 21 days after move out to return it with an itemized statement, and since January 1, 2026, if you collected rent electronically you have to refund it electronically.
Most of the deposit advice on the internet is two years out of date, and in California two years is the difference between a lawful deposit and a lawsuit. Three separate bills have rewritten this statute since 2024. Here is what the law actually says today, with the section numbers, so you can check us.
As of July 1, 2024, a California landlord may not demand a deposit greater than one month's rent, on top of first month's rent. Furnished or unfurnished makes no difference anymore.
Cal. Civ. Code 1950.5(c)(1). AB 12, Stats. 2023, Ch. 733.
At the current El Segundo median asking rent of {{median_rent:el-segundo}}, that puts your ceiling at {{median_rent:el-segundo}}. Charge double the way you could two years ago and you are outside the statute.
The small landlord exception is narrower than its name. You can still charge two months, but only if you are a natural person, or an LLC where every member is a natural person, AND you own no more than two rental properties totaling no more than four units. Both conditions. If you own a six unit building, you do not qualify, and the cap is one month. This is the single most misread sentence in the statute.
1950.5(c)(5)(A)(i) and (ii). A family trust counts as a natural person under (c)(5)(C). The exception never applies to a service member tenant, per (c)(5)(B).
If you collect rent through a portal or Zelle and you mail a paper check at move out, you are now doing it wrong. That rule is six months old.
You have 21 calendar days from the day the tenant vacates to send an itemized statement and return whatever is left.
1950.5(h)(1)
Here is the part almost nobody knows. If your deductions for repairs and cleaning together come to more than $125, you must attach the actual documentation. That means the invoice or receipt from the vendor, or if you did the work yourself, a description of the work plus your time and a reasonable hourly rate. Under $125 you can skip it. Over $125, and you skipped it, and you have handed the tenant an argument.
1950.5(h)(2) and (h)(4)(A). The Attorney General's consumer alert phrases this threshold differently than the Courts self help guide. The statute's "do not exceed $125" is what controls.
You cannot deduct for it. That much is settled, and the statute goes further than most owners realize. You cannot charge for the cumulative effects of ordinary wear and tear across multiple tenancies either.
1950.5(e)(2)(A)
We are not going to pretend there is a bright line here. California law does not define ordinary wear and tear. Not in 1950.5, not in the Courts self help guide. Every list you have seen online of what counts is somebody's opinion presented as law. It is decided case by case, and in that fight you carry the burden of proving your deductions were reasonable, per 1950.5(m). Photos are how you carry it, which is exactly why the legislature made them mandatory.
Bad faith retention exposes you to statutory damages of up to twice the deposit, on top of actual damages. The tenant can bring it in small claims. And the burden of proving your amounts were reasonable sits with you, not with them.
1950.5(m) and (o)
No. We checked all fifteen titles of the El Segundo City Code. There is no rent stabilization ordinance, no deposit rules, no deposit interest requirement, and no rental housing commission. The Los Angeles City RSO does not reach El Segundo because it is a separate incorporated city, and the LA County ordinance covers unincorporated areas only.
State law governs, which means AB 1482 does apply to you. Rent increases are capped at 5 percent plus CPI, or 10 percent, whichever is lower, unless your building received its certificate of occupancy within the last 15 years. That is a rent rule, not a deposit rule. They are separate statutes and people conflate them constantly.
El Segundo City Code, all titles reviewed. Civ. Code 1947.12. LAHD RSO scope. LA County DCBA scope.
Worth knowing. AI search engines currently return a confident, false claim that El Segundo has a Rent Stabilization Program and a Rental Housing Oversight Commission. It does not. That is a conflation with Los Angeles City and County. We read the municipal code instead of the search summary.
Can I charge two months' rent for an unfurnished unit in El Segundo?
No. Since July 1, 2024 the cap is one month's rent regardless of furnishing, unless you are a natural person or all natural person LLC owning no more than two properties and four total units.
How long do I have to return a security deposit in California?
21 calendar days from the date the tenant vacates, together with an itemized statement of any deductions.
Do I have to return the deposit electronically?
Yes, if you collected the deposit or rent electronically, unless you and the tenant agreed otherwise in writing. This took effect January 1, 2026 under AB 414.
Can I deduct professional carpet cleaning?
Only if it is reasonably necessary to return the unit to its condition at the start of the tenancy. A blanket lease clause requiring it is no longer enforceable as an automatic deduction, as of January 1, 2025.
Is El Segundo under rent control?
Not local rent control. El Segundo has no rent stabilization ordinance. Statewide AB 1482 applies, capping increases at 5 percent plus CPI, or 10 percent, whichever is lower.
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General information for California rental property owners, not legal advice. Deposit disputes turn on specific facts. Confirm with a qualified attorney before you withhold anything.
Law verified July 13, 2026 against Cal. Civ. Code 1950.5 as amended by AB 414 (Stats. 2025, Ch. 340).
Topics: security deposits, california law, el segundo, landlord guide
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Schofield Properties is a family run property management company at 323 Richmond St, El Segundo, CA 90245. We have managed the South Bay since 1972 and personally oversee about 186 doors today. Book a call to talk about your property.
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