August 2025 Blog
Pacific Grove Property Management | August 2025 Newsletter
Staying Ahead: Property Management Updates You Should Know
Dear Clients and Partners,
We hope you’re enjoying a relaxing and productive summer. As always, we’re committed to keeping you informed about important changes and trends in California’s property management landscape. From compliance deadlines to legislative updates, here’s what you need to know this season:
🛠️ 1. Balcony Inspection Deadlines Are Approaching – Is Your Property Compliant?
As part of California Senate Bill 721 (for multifamily properties) and Senate Bill 326 (for HOAs), all applicable properties are required to complete mandatory inspections of elevated exterior elements—such as balconies, decks, stairs, and walkways—that are more than 6 feet off the ground and constructed of wood or other load-bearing materials.
Key details:
- SB 721 applies to multifamily residential buildings with 3 or more units. The first inspection must be completed by January 1, 2026, and then every 6 years thereafter.
- SB 326 applies to condos and HOAs, with a deadline of January 1, 2025, and inspections every 9 years after that.
Inspections must be performed by licensed professionals (architects, structural engineers, or certified inspectors), and any identified hazards must be corrected within 180 days. We encourage property owners to get ahead of contractor backlogs by booking inspections now. We’re happy to help coordinate this process.
💼 2. Security Deposit Reform – What You Can (and Can’t) Collect Now
Effective July 1, 2024, California’s updated security deposit law (AB 12) limits the amount a landlord can collect to no more than one month’s rent, regardless of whether the rental is furnished or unfurnished.
✅ Applies to:
- All residential rental properties in California: single-family homes, condos, apartments, ADUs, and more.
❌ Exceptions:
Landlords may collect up to two months’ rent only if:
- The landlord is a natural person (not a corporation, LLC, or REIT), and
- Owns no more than two residential rental properties, or no more than four units total.
Example: If you own three single-family rentals or a duplex and a triplex, you must follow the one-month limit—even if you’re not incorporated.
Other important notes:
- Pet deposits are included in the one-month cap.
- The law does not apply retroactively, but it does apply to new leases and renewals signed on or after July 1, 2024.
- Tenant “agreement” to pay more is not valid if it exceeds the legal cap.
We’ve already updated our lease templates and internal processes to comply with this rule. If you’re unsure whether you qualify for the small landlord exception, we’re happy to review your property holdings and advise accordingly.
📈 3. Rent Cap for 2025–2026 Announced Under AB 1482
The allowable rent increase for properties governed by the Tenant Protection Act (AB 1482) has been set at 7.8% for the period of August 1, 2025 – July 31, 2026. This reflects 5% plus the applicable Consumer Price Index (CPI), which is updated annually by the state.
We are currently reviewing all applicable lease renewals and ensuring timely, compliant notices are sent out. If your property is exempt from AB 1482, please contact us to ensure all necessary exemption disclosures have been properly documented.
🧰 We’re Here to Help
If you have any questions about these updates—or need assistance with inspections, rent increases, lease renewals, or compliance documentation—don’t hesitate to reach out. Our goal is to keep your investments protected and your operations aligned with California law.
Warm regards,
The Pacific Grove Property Management Team
📍 650 Lighthouse Avenue, Suite 105, Pacific Grove, CA 93950