Learn the ins and outs of Virginia’s security deposit laws with our comprehensive guide for property owners. Ensure compliance and protect your investment.

Understanding the Virginia Security Deposit Laws: A Guide for Property Owners

Virginia landlords must abide by the Virginia landlord-tenant law, Virginia Code § 55.1-1226. The code primarily regulates everything to do with how a landlord must handle a tenant’s security deposit, including the maximum security deposit, the security deposit limit, what deductions to make, and when to return it. These rules apply to every dwelling unit and help maintain clear expectations in rental property ownership.

As a Virginia landlord, staying compliant with the law can help you minimize potential conflicts with your tenant. If a landlord fails to follow the statute, they risk losing the ability to make appropriate deductions, facing penalties, or becoming liable for additional costs.

The code primarily regulates everything to do with how a landlord must handle a tenant’s security deposit, including the maximum security deposit, the security deposit limit, what deductions to make, and when to return it. These rules apply to every dwelling unit and help maintain clear expectations in rental property ownership.

The following is a comprehensive overview of Virginia’s security deposit law.

Is There a Limit on Security Deposits in Virginia?

Yes, there is a limit. The most you can ask a tenant to provide as a security deposit is the equivalent of two months’ rent. If you’re charging a monthly rent of, say, $1,000, then the full security deposit you can charge a tenant would be $2,000.

Can a Landlord in Virginia Charge an Additional Pet Deposit?

Yes, Virginia law allows landlords to charge pet owners an additional deposit. You can then use the deposit toward fixing damage caused to the rental unit by the tenant’s pets A few examples of pet damage include ripped-up carpets, stains, flea infestations, holes in the wall, and pet odor.

Typically, a pet deposit ranges between $100 and $500. The price to set should be dependent on things like the size of a pet, the type of pet, and the number of pets.

You cannot, however, charge a deposit for a disabled tenant who uses a service dog. If you do, that would be in violation of the Fair Housing Act (FHA) and the Americans with Disabilities Act (ADA).

How Should a Landlord Store a Tenant’s Security Deposit in Virginia?

Before 2014, landlords were obligated by law to place tenants’ deposits in an interest-earning account. The rate of interest was set below that of the Federal Reserve’s discount rate. The interest was only due to tenants who’d have rented the dwelling for at least 13 months. The requirement to pay interest was only applicable at the end of the tenancy.

The state of Virginia no longer requires landlords to store a tenant’s deposit in an interest-accruing account. The only exception to this is if both you and your tenants agree to do so. This agreement must be in writing.

What Deductions Can a Landlord Make to a Security Deposit?

As a landlord in Virginia, you can only make deductions to a tenant’s security deposit for the following reasons:

• Tenant owes rent
• Unpaid utility bills
• Financial damage arising from a violation of the lease term
• Charges allowed under the lease or rental agreement
• Damage exceeding normal wear and tear

For clarity’s sake, normal wear and tear refers to damage resulting from the intended use of a dwelling. Examples include a worn carpet, wobbly doorknobs, small scratches on walls and flooring, and faded paint. As a landlord, you’re liable for fixing these kinds of damages.ds of damages.

Damage exceeding normal wear and tear often results from a tenant breaks something through carelessness or negligence.Examples of this kind of damage include broken or missing floor tiles, missing fixtures, missing curtains or blinds, or broken bathroom mirrors.

Any deductions you make to a tenant’s deposit must be made after the tenant vacates. If you need to deduct money, ensure the charges are well-documented and justified.

Are There Requirements for How Landlords Need to Keep Security Deposit Records?

Yes, Virginia law requires that landlords keep proper records of their tenant’s security deposits. The records must include any itemized deductions you’ve made over the last two years. You must also make the records available to the tenant or any of their representative.

Do Landlords in Virginia Have to Conduct Walk-Through Inspections?

You have a right to conduct a walk-through inspection of the property. If you choose to exercise this right, you must also make a reasonable effort to let your tenant know of their right to also attend it.

You must notify them within five days of receiving their lease termination notice or after serving them proper notice and written notice to vacate. If the tenant wishes to be present, they must respond in writing.

Next, you must notify the tenant of the time and date you wish to conduct the inspection. You must schedule it at least three days before the tenant leaves. This move out inspection helps clarify whether any excessive property damage exists.

If during the inspection you come across damage exceeding normal wear and tear, you must prepare an itemized list and send it to the tenant.

When Do Landlords in Virginia Have to Return Their Tenant’s Security Deposit?

Once a tenant moves out, you must return the tenant’s deposit (or whatever remains) within 45 days. If you’ve made any deductions, you must send the remaining deposit alongside an itemized statement. The itemized statement must clearly outline any charges, such as repairs or unpaid rent, along with their approximate costs. Such as:

• The security deposit amount you’re returning.
• Type of damages that have occurred and their approximate repair costs.

You can deliver the itemized statement either in person or by sending it via certified mail.

If the cost of fixing the damage exceeds the security deposit amount, you must notify the tenant of that fact within 45 days. You’ll then have another 15 days to send the tenant the itemized list of damages including approximate repair cost.

If a tenant fails to provide a forwarding address, the deposit may eventually be treated as unclaimed property.

What Happens If a Landlord Sells Their Investment Property?

If the property changes hands, the responsibility of returning security deposits becomes the new landlord’s responsibility. An incoming landlord must ensure they receive the deposit funds from the previous owner, as this is part of the landlord’s responsibility during a transfer of ownership.

If a tenant abandons the property, the same rules for timelines and documentation still apply.

If disputes arise, either party may pursue resolution in small claims court.

Bottom Line

Virginia security deposit law is one among many laws under the statewide Virginia Landlord Tenant Act. Understanding it is key to running a successful investment property.

If you find any aspect of managing your rental property daunting, Keyrenter Alexandria can help. We are a top property management company in Alexandria. We understand all the complexities that come with managing a rental property and can help you overcome them reliably and professionally. Get in touch with our expert team today to get started right away!

Disclaimer: This blog should not be used as a substitute for legal advice from a licensed, qualified attorney in your state. Laws change, and this post might not be updated at the time of your reading. Please contact us for any questions you have in regard to this content or any other aspect of your property management needs.