California Lease Agreement: AB 12 Deposit Cap, AB 1482 Rent Cap, Required Disclosures (2026)

The 2024 to 2026 rule changes that broke older templates

If you are reusing a California lease template that was last revised before mid-2024, it is almost certainly out of compliance with current law. Three major statutes have rewired residential leases in California within the past two years, and each one carries either a deposit forfeiture, a rent rollback, or a civil penalty for landlords who get it wrong.

The first is Assembly Bill 12, signed by Governor Newsom in October 2023 and effective 1 July 2024. AB 12 amended Civil Code section 1950.5 to cap residential security deposits at one month of rent for both furnished and unfurnished units. The historic two-month and three-month ceilings are gone for most landlords. A narrow small-landlord carve-out remains: if you personally own no more than two residential rental properties with a combined total of no more than four units, you may charge up to two months as deposit, but you may not invoke the carve-out against an active-duty service member. Any lease drafted before mid-2024 that calls for a two-month or three-month deposit is now either unenforceable as to the excess, or carries the risk of statutory damages under Civil Code section 1950.5(l).

The second is the Tenant Protection Act of 2019, codified at Civil Code section 1947.12. AB 1482, as the act is commonly known, caps annual rent increases on covered units at 5 percent plus the regional Consumer Price Index, with a hard 10 percent ceiling regardless of how high local CPI runs. The act covers most multi-family housing more than 15 years old, plus single-family rentals owned by corporations, REITs, or LLCs with a corporate member. Crucially, the corporate-ownership exemption for single-family homes is automatic, but it only applies if the lease contains the precise statutory exemption notice. Leases that omit the exemption notice are treated as if the cap applies.

The third is AB 2801, signed in September 2024 and rolled out in stages through 2025. AB 2801 amended Civil Code section 1950.5 to require landlords to take photographs of the unit before the tenancy begins, after the tenant moves out, and after any cleaning or repairs the landlord is charging the tenant for. The photos must be provided to the tenant along with the itemised deduction statement within the 21-day return window. A landlord who deducts for cleaning or damage without producing the photos cannot prove the loss in court, and the deduction is treated as a bad-faith withholding under section 1950.5(l).

Security deposit rules in detail

Security deposit law in California sits in Civil Code section 1950.5, and it is the single most-litigated landlord-tenant statute in the state. The headline rule is the one-month cap from AB 12, but the surrounding mechanics are equally consequential. The landlord may use the deposit only for: unpaid rent, repair of damages beyond normal wear and tear, cleaning to return the unit to the level of cleanliness at move-in, and replacement of personal property when the lease expressly permits it. The statute does not permit deductions for routine repainting after a tenancy of two years or more, for re-keying, or for upgrading worn fixtures.

The landlord must return the deposit, plus an itemised statement of any deductions, within 21 calendar days after the tenant vacates and returns possession. The 21-day clock runs from the date the tenant gives back keys, not from the lease end-date. If the itemised deductions exceed 125 dollars in total, the landlord must also include copies of receipts or invoices for the work, or, if work is performed in-house by the landlord, a reasonable itemisation of hours and materials. A landlord who fails to return the deposit in 21 days, or who retains any portion in bad faith, is liable for the actual amount wrongly withheld plus statutory damages of up to twice the deposit.

Section 1950.5(m) prohibits non-refundable deposits or fees of any kind. A landlord cannot lawfully charge a non-refundable cleaning fee, a non-refundable redecoration fee, a non-refundable carpet fee, a non-refundable move-in fee, or any similarly named charge collected at signing and treated as forfeit. Anything paid at the start of the tenancy that is not first month's rent is treated as part of the security deposit, regardless of what the lease calls it. Mislabelling fees to evade the one-month cap is a recurring source of small-claims judgments against landlords statewide.

AB 2801 added the photo-documentation requirement. For tenancies that begin on or after 1 April 2025, the landlord must take photographs of the unit before the tenant takes possession, ideally during the move-in inspection, and provide them to the tenant. For any deposit deduction for cleaning or damage, the landlord must also take post-tenancy photographs after the tenant vacates and post-repair photographs after any work the deduction pays for. All three sets of photographs accompany the itemised statement. A landlord who skips this step cannot prove cleaning or damage deductions in a small-claims action, and the entire withheld amount is presumed to be retained in bad faith.

AB 1482 rent cap mechanics

The statewide rent cap under Civil Code section 1947.12 limits annual rent increases on covered units to 5 percent plus the regional CPI, with a maximum of 10 percent in any 12-month period. The Department of Housing and Community Development publishes the applicable CPI by region every August for use in increases taking effect on or after 1 August. The cap counts cumulative increases over any rolling 12-month window, so a landlord cannot evade the cap by issuing two 7-percent increases six months apart.

Coverage is broad. AB 1482 applies to all residential properties more than 15 years old, with a rolling 15-year exemption window. A unit built in 2010 came under the cap in 2025; a unit built in 2011 will come under the cap in 2026. Multi-family properties of any size are covered. Single-family homes and condos are covered if they are owned by a corporation, a REIT, or an LLC that has any corporate member. The legislature wrote the corporate-LLC rule to capture institutional ownership, but it sweeps in many small landlords who hold their property in an LLC for liability reasons.

The exemption for individually owned single-family rentals is not automatic. To claim it, the lease must contain a notice in 12-point bold type that quotes the statutory language from section 1947.12(d)(5). If the notice is missing, mis-quoted, or in the wrong font size, the unit is treated as covered and any rent increase above the cap is unenforceable. Landlords who renew long-running tenancies without updating the lease to include the exemption notice often find themselves locked into the cap years later.

AB 1482 also imposes just-cause eviction protections on covered units after the tenant has occupied the unit for 12 months. The landlord may terminate only for at-fault or no-fault causes listed in Civil Code section 1946.2. No-fault terminations (owner move-in, withdrawal from the rental market under the Ellis Act, substantial renovation, or compliance with a government order) require relocation assistance equal to one month of rent, paid before the tenant vacates.

Required disclosures in a California lease

California layers state disclosure requirements on top of the federal lead-based paint rule, and the list grows almost every legislative session. As of 2026, a compliant California lease must include the following disclosures, each in writing and each attached to or incorporated into the lease itself.

Lead-based paint disclosure is required by federal law (24 CFR Part 35) for any unit built before 1978. The landlord must provide the EPA's "Protect Your Family from Lead in Your Home" pamphlet, disclose known lead hazards, and include the standard federal disclosure form signed by both parties. Penalties for non-disclosure run to 19,507 dollars per violation as of the 2024 inflation adjustment by HUD.

Megan's Law database notice is required under Civil Code section 2079.10a. The lease must include language directing the tenant to the California Department of Justice sex-offender registry at meganslaw.ca.gov. The disclosure is informational; the landlord is not required to research whether registered offenders live nearby. Mold disclosure is required under Health and Safety Code section 26147 when the landlord knows or has reason to know of the presence of mold that exceeds permissible exposure limits or threatens occupants' health. Bed-bug information is required under Civil Code section 1954.603 for all leases entered after 1 July 2017; the landlord must provide a one-page statutory notice about bed-bug identification and reporting.

Flood-hazard disclosure was added by AB 1944 in 2022. If the unit lies within a FEMA Special Flood Hazard Area, the landlord must disclose that fact and notify the tenant that flood insurance is the tenant's responsibility. Demolition permit disclosure is required if the landlord has applied for a demolition permit, regardless of whether the demolition will happen during the tenancy. Methamphetamine and fentanyl contamination must be disclosed if the property has been found contaminated under Health and Safety Code section 25400.28 and remediation has not been certified complete. Gas and electricity sub-metering must be disclosed if utilities serve more than one unit and the tenant is being charged for shared usage.

Local overlays: rent control, just cause, and tenant protections

AB 1482 is the statewide floor. Many California cities layer stricter local rules on top. Los Angeles maintains its decades-old Rent Stabilization Ordinance covering buildings constructed before October 1978; the LA RSO caps annual increases at the cost of living between 3 and 8 percent and requires registration with the Housing Department. San Francisco's Rent Ordinance applies to most buildings constructed before June 1979 and is administered by the Rent Board, with annual allowable increases typically in the 1 to 3 percent range. Berkeley, Oakland, Santa Monica, West Hollywood, and East Palo Alto operate their own boards. San Jose, Mountain View, and Richmond have all enacted local just-cause and rent-stabilisation rules within the past decade.

Where local and state rules conflict, the stricter rule applies. A landlord in San Francisco subject to both AB 1482 and the local Rent Ordinance must respect the local cap (typically lower) and the local just-cause framework (typically stricter). A landlord in Bakersfield, with no local rent control, falls back to the state-only rules. Always check the city ordinance before drafting the rent-increase clause and the termination clause.

Notice periods, entry, and habitability

Notice to terminate a month-to-month tenancy is governed by Civil Code section 1946.1. The landlord must give 30 days written notice if the tenant has lived in the unit less than one year, or 60 days if the tenant has lived there one year or longer. The tenant generally needs only 30 days. For covered units under just-cause protections, the landlord must additionally state a permitted cause and, for no-fault terminations, pay one month of relocation assistance. Notice of rent increase up to 10 percent requires 30 days; above 10 percent requires 90 days under Civil Code section 827.

Landlord entry is governed by Civil Code section 1954. The landlord may enter only for repairs, agreed services, inspections after notice, showings, or in genuine emergencies. The landlord must give at least 24 hours written notice in most cases (48 hours for move-out inspections), enter only during normal business hours, and may not enter when the tenant is absent without prior consent unless the lease specifies otherwise. Repeated unannounced entries can support a constructive-eviction claim.

The implied warranty of habitability under Green v. Superior Court (1974) 10 Cal.3d 616 obliges the landlord to maintain weatherproofing, plumbing, hot and cold water, heating, electrical, sanitation, and structural elements throughout the tenancy. California Health and Safety Code section 17920.3 lists the specific conditions that render a unit substandard. A tenant in a habitability-defective unit may, after written notice and a reasonable opportunity to repair, repair-and-deduct (capped at one month of rent under Civil Code section 1942), withhold rent if the defect is severe, or vacate. The implied warranty cannot be waived in the lease.

Sample California-specific clauses

Below are three sample clauses tuned to current California law. They are templates, not legal advice; adapt them to the specific property, parties, and circumstances.

Security deposit clause

AB 1482 exemption notice (use only if the unit is genuinely exempt)

Megan's Law notice

Where California sits relative to other states

California's lease rules are stricter than Texas, Florida, Georgia, and most southern states across nearly every dimension: deposit cap, rent cap, notice periods, just-cause protections, and disclosure load. Compared to New York, California is broadly comparable on deposit caps and rent caps for covered units, but New York's HSTPA framework and NYC's Rent Stabilization Code differ in mechanics. Texas, by contrast, imposes no statutory deposit cap and no statewide rent control, and a Texas template is materially shorter than its California equivalent. See the state comparison hub, the Texas lease page, the New York lease page, and the Washington lease page for side-by-side context.

Frequently Asked Questions

Sources

• California Civil Code section 1950.5 (security deposits, as amended by AB 12 and AB 2801): leginfo.legislature.ca.gov
• California Civil Code section 1947.12 (Tenant Protection Act, AB 1482 rent cap): leginfo.legislature.ca.gov
• California Civil Code section 1946.1 (notice to terminate month-to-month): leginfo.legislature.ca.gov
• California Civil Code section 1954 (landlord right of entry): leginfo.legislature.ca.gov
• EPA lead-based paint pamphlet and Form 5630-13: epa.gov/lead
• California Department of Justice Megan's Law registry: meganslaw.ca.gov
• California Department of Housing and Community Development AB 1482 guidance: hcd.ca.gov