Tenant moves out 15 days into new lease and wants deposit back

28 Replies

Hi BP community,

I have a rental in Los Angeles, CA near USC. The renters, all young college students, rented a 5 bedroom back house. 2 short weeks into a 12 month agreement, they decide to move out. The previous renter resided there for 15 years and had a roach infestation that we were not aware of, and to be honest, they were extremely dirty. We totally renovated the home and had pest control services come and spray a few times after they moved out, but apparently we needed a few more sprays before it was truly roach-free. The students’ decision to move early was largely based on the roach problem, however we offered to tent the home for pests to put their concerns at-ease. They ultimately declined our offer and chose to move elsewhere.

I requested a forwarding address from them and they eagerly questioned me about the security deposit being returned. I did not plan on returning it for the reason of breaking the lease and not receiving a full 30 day notice to move out. We had to scramble to find another renter, and we even offered a full fumigation despite the financial burden to put their concerns at ease. Anyhow, they told me they are going to have to “talk about it” and see if that will work for them (referring to my response that they will probably not receive their entire deposit back). I didn’t want to be rude but it’s not their decision to decide if I am in the legal right to do that. I also know that I am in a tenant-friendly state and city, and even if I am in the right to charge them, I might still lose if they pursue it. Unfair, but this is the reality. What should I do? What would you do??

Breach of contract. Not due a deposit. 

They did not even give you a chance to remediate the issue.

Check your local laws to confirm this complies.

They broke the lease. Didn't give you a chance to fix the problem. I don't think in a normal state they would have a chance....but as you said, you're in Cali. I think your chances are 50/50. I would proceed as normal and see where they go with it......

For your future thinking, Cali is only going to get worse. Consider selling and buying 3 places in AZ, TX, TN or Fl

You were careless; you did not inspect enough to know what was going on.  Given those circumstances I'd return the deposit. Funmigate the place and get it back on the market. That's what I would do.

@Lauren Alpert  They broke the lease and by most states legal standards, they should be penalized but you are in CA so all bets are off. They most likely won't do anything but as @Bjorn Ahlblad said, some of this is on you. If you feel like taking the risk of treble damages or whatever else California can throw at you as a landlord, then hold your ground. Make sure you have documented everything really well. You can always stand firm and if they challenge it legally, you can reassess. 

I'd give the deposit back to them and ask them to sign a release for both you and them.  They could go after you for damages--having to move because of the roach infested home, all of their moving costs, they having to fumigate their stuff, because otherwise they likely took some with them, their rashes and allergies, and so on.  You are in CA and have higher standards that most places.  Renting a house with roaches makes it not habitable.  Roaches are HARD to get rid of.  You should get an annual contract that sprays monthly for at least a year or two.

@Lauren Alpert

Return the security deposit, roach infestation is not habitable. That's what we did in your situation. Spray and bait every ten days until resolved. It took us three months, hopefully you will get it resolved soon.

Hi @Lauren Alpert - I'd say your actions should be based off of a few things. There is a difference between an infestation and there being a few stragglers of an initial treatment of the roaches. If it is an infestation and the home wasn't habitable I would cut your losses and get them their deposit back to avoid any kind of action against you. If you have proof of the condition of the property prior to move in, and there clearly wasn't an infestation problem you stand a better chance. You also want to abide by what your lease says if there is a break of the lease agreement. 

I was on team keep the deposit. But then I saw you’re in California. In that environment and with the caveat that they moved out in 15 days and you should be able to get new tenants in within the next 15 days while they are still paying rent. I’d return an deposit not used to clean or repair damage down moving in and out. 

@Lauren Alpert  

Lease breaks should always be negotiated between the landlord and tenant. You should come to a financial agreement prior to them moving out. They should be required to sign a "lease break" agreement that states clearly what their financial responsibility is. If they don't sign the agreement, they are in breach of contract and you can keep collecting rent from them. This is their motivation to come to terms.

Even though it wasn't your intent, you rented a cockroach infested property. That looks bad. Your legal rights in a tenant friendly state are not as strong as you think they are. I would send back the entire deposit. Be done with the relationship. Why chance them taking you to court and potentially having a judge award damages to them? Even hiring an attorney will cost more than just cutting the check and being done with it. 

This is the down side of renting to students. You have 5 student and 10 parents, so 15 people to deal with when a problem arises. All it takes is one of those five sets of parents pushing the issue and you end up in court.

@Bjorn Ahlblad

I totally understand your perspective, but in this situation I think careless is somewhat of an overstatement. We have maintained contracts with major pest control companies for years. We did not see any live roaches prior to renting the home out. It’s located in a very very dense part of town. It’s difficult if not impossible to completely eradicate roaches from these rentals with 100% effectiveness. But I thank you for your input.

@Lauren Alpert

I agree that we need more details. If it needs tented i take it to mean there was more than a roach they saw. Whats legal and whats right are not always the same thing. Im torn on whats right. While you offered to fumigate, there can still be some issues. The process takes at minimum a few days right? Maybe even a week. Then cleanup time after. Where did you propose they stay during that period? In other words, was fumigating it a reasonable option for them? As an investor its easy to say they broke the lease that money is mine. As a consumer, Im not sure i agree with myself. If i went to a restaurant and my steak were under cooked id have them cook it more. If i found a dead mouse in my soup, i would demand my money back, and likely never return. Youre the only person in this conversation who knows which of these scenarios your tenants were in.

Either way, be sure to provide your notice of intent to withhold or refund within the allotted time.   Ours is 14 - 21 days in WA. 

I personally dont think this about legalities.  I probably would have done the same thing as your tenants if I were in their situation.  I would just return their deposit, get rid of the roaches for good and then keep it moving for the next tenant.

@Lauren Alpert I would return deposit and get them to sign a release. arguable you broke the lease by the place not being habitable at that point all bets are off. I would get the property back in rent condition and RE-rented if you haven’t. Could you get away with not giving the lease back, probably but if there was actually a cockroach infestation than that’s on you and they made a reasonable choice by moving out immediate. If you keep the deposit especially if you get it rented out immediately than you are profiting from negligence (not cool and not something I would want to go to court over) you can’t even keep more than the cost of their vacancy and damages in California meaning if it’s re-rented in two weeks you can’t claim more than two weeks of rent as that’s the total of the damages, no double dipping. You also have a responsibility to try to rent it out as soon as possible if you are going after damages ie you can’t just wait for a few months to rent out so you can charge extra damages. I think this is a case of I (or my agents the pest control people that you are legally responsible for) messed up take ownership and move on. I don’t mean this to sound harsh but land lords have been getting a bad wrap lately and it’s things like this that add fuel to the fire. A new story could make this sound really bad if they wanted.

Thanks for all the answers. I decided to return the entire deposit back. These students will probably fight and win even though I took the necessary steps prior to them moving in. Next time I’ll take it a step further and spray 4 times perhaps. I originally thought a fair compromise was to keep half of the deposit, meeting them halfway, because the contract was breached and I offered a fail proof solution. The home was fully renovated, very nice, and I charged a bit less than market so there was value in what was provided to them. It certainly was not uninhabitable. I’m just not willing to roll the dice with California courts…

@Lauren Alpert

It pains me to see you thought about returning half. Seriously?! You rented them a roach infested house.

Business is business, but roaches are nasty AF and I wouldn’t want to live there or make anyone live there.

I’m glad you decided to do the right thing in the end.

On two different occassions tenants left the house super infested with roaches. I held off the units each time till I completely eradicated the roaches using Phantom, Suspend, Talstar, Temprid and god knows what else in about four weeks. I sprayed every nooks and crannies these suckers can ever hide in. Sealed every small opening. Opened the face plates of plugs and light switches, pwdered the interior. Replaced refrigerator and stove. Finally, it was all gone. Only then I rented it, tenants have stayed there for now over three years and one for seven. Just incase there were any straglers, I left contact kill insecticide for tenants to use. I get these from Domyown Pest Control products and it has always worked for me. Use it in rotation. Glad to hear you returned the deposit.

@Lauren Alpert I had something similar happen, the tenants were from out of state, they sent their realtor to look at the home, their concerns were a busy road so they asked about it before hand. I was very specific upfront about how busy that road was. They moved in and not days later wanted to break the lease because the road was too busy. It kind of went opposite for me though. They didn’t ask for the deposit back and even paid next months rent to cover a 30 day notice, I didn’t ask for the next month but they sent it anyway. I was able to get it re-rented in a week. I think if you cut your loses with them and get a tenant that wants to be in that house asap then you won’t be out any rent. Maybe compromise on giving them some deposit back. Depending on that “infestation” you could make a deal with them because they are technically breaking the lease and they have some responsibility, just as you immediately called pest control and started making the situation right.

Originally posted by @Lauren Alpert :

Thanks for all the answers. I decided to return the entire deposit back. These students will probably fight and win even though I took the necessary steps prior to them moving in. Next time I’ll take it a step further and spray 4 times perhaps. I originally thought a fair compromise was to keep half of the deposit, meeting them halfway, because the contract was breached and I offered a fail proof solution. The home was fully renovated, very nice, and I charged a bit less than market so there was value in what was provided to them. It certainly was not uninhabitable. I’m just not willing to roll the dice with California courts…

 I would have returned the deposit no matter what state it was in 

Why didn’t you charge less than market rate?

Originally posted by @Lauren Alpert :

Hi BP community,

I have a rental in Los Angeles, CA near USC. The renters, all young college students, rented a 5 bedroom back house. 2 short weeks into a 12 month agreement, they decide to move out. The previous renter resided there for 15 years and had a roach infestation that we were not aware of, and to be honest, they were extremely dirty. We totally renovated the home and had pest control services come and spray a few times after they moved out, but apparently we needed a few more sprays before it was truly roach-free. The students’ decision to move early was largely based on the roach problem, however we offered to tent the home for pests to put their concerns at-ease. They ultimately declined our offer and chose to move elsewhere.

I requested a forwarding address from them and they eagerly questioned me about the security deposit being returned. I did not plan on returning it for the reason of breaking the lease and not receiving a full 30 day notice to move out. We had to scramble to find another renter, and we even offered a full fumigation despite the financial burden to put their concerns at ease. Anyhow, they told me they are going to have to “talk about it” and see if that will work for them (referring to my response that they will probably not receive their entire deposit back). I didn’t want to be rude but it’s not their decision to decide if I am in the legal right to do that. I also know that I am in a tenant-friendly state and city, and even if I am in the right to charge them, I might still lose if they pursue it. Unfair, but this is the reality. What should I do? What would you do??

Typically tenant breaks the lease, you keep the deposit. That's a no brainer. But you are in the socialist republic of California. So all bets are off. The government has stripped you of all of your private property rights. At this point you should just be happy that you aren't being publicly tarred and feathered for being a lord of the land.