When you rent out a property, it’s essential to make sure that you have enough of a security deposit to cover any potential damages or late payments from your tenants. A common practice is to collect at least one month's rent as a security deposit. But in some cases, it makes sense to collect more than just one month's security deposit.
The main reason to collect more than one month's security deposit is because of inflation. Over time, your vendor's prices in your area may increase significantly due to changes in the local economy. If you don't adjust your security deposit amount accordingly, you may not have enough money to cover any potential damages or late payments from tenants if the security deposit amount fails to keep up with inflation.
At each renewal, we review the amount of the deposit on file, and make an increase in the security deposit amount as part of our renewal process.
Accidents happen, and it’s important to make sure that you have enough of a security deposit in case there’s significant tenant damage that needs to be repaired.
It's also important to make sure that you're collecting security deposits in accordance with your local landlord-tenant laws. Make sure to read up on the laws so you know how much security deposit you can collect, and any other restrictions imposed by law.
If you're worried about collecting too much from tenants, look into using a Security Deposit Alternative. There are quite a few on the market, and currently, we use SayRhino. Rhino allows us to collect a higher deposit for our property owners, while requiring less in upfront, out-of-pocket costs for most renters.
Feel free to ask if you have any questions about our security deposit policies for your San Antonio Single Family Residential Rental Properties.