When a tenant moves out of your property, there’s a good chance that they won’t leave it the way they found it. If there’s obvious damage, like holes in the walls, you’ll be able to deduct the cost of the repairs from their security deposit. However, landlords cannot retain any portion of the security deposit to cover repairs or maintenance for normal wear and tear or depreciation of the property.

Normal wear and tear can be difficult to define; in general, it refers to the inevitable decline of a property’s overall condition due to time and usage. All rental properties will experience some deterioration over time, even with the most diligent tenants. It’s normal and to be expected.

Normal wear and tear should never be deducted from the security deposit, but the property should be refurbished before the next tenant moves in. To cover these costs, make sure you’re planning ahead by budgeting for any minor repairs, maintenance, or cleaning that might be needed for each of your properties.

Unlike normal wear and tear, tenant damage is caused by neglect, abuse, misuse, or accidents. Intentional alterations made without your approval would also fall under tenant damage, as would any damage caused by a tenant’s guests.