Security Deposit Interest in California: Local Rules (2026)
No statewide interest requirement (Cal. Civ. Code §1950.5 is silent on interest); San Francisco, Berkeley and Los Angeles (RSO units) require ann… Calculator, statute citation, Last Verified date o
Quick answer
Not at the state level — but some California cities require it. No statewide interest requirement (Cal. Civ. Code §1950.5 is silent on interest); San Francisco, Berkeley and Los Angeles (RSO units) require annual interest at locally-set rates — SF 4.2% (eff. 3/1/2026–2/28/2027), Berkeley 0.9% for Dec 2025 annual payment / 0.6% for Oct 2026 move-outs, LA 3.03% for 2026; Oakland explicitly does not accrue interest. The rule comes from Cal. Civ. Code §1950.5 (statewide — no interest provision); SF Rent Ordinance (S.F. Admin. Code ch. 37); Berkeley Rent Ordinance; Los Angeles Rent Stabilization Ordinance (LAMC §151.06.02(F)/(G) per LAHD bulletin). State statute (official text) · 2026-10-28
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What California law does — and does not — require
California has no statewide statute requiring interest on security deposits. No statewide interest requirement (Cal. Civ. Code §1950.5 is silent on interest); San Francisco, Berkeley and Los Angeles (RSO units) require annual interest at locally-set rates — SF 4.2% (eff. 3/1/2026–2/28/2027), Berkeley 0.9% for Dec 2025 annual payment / 0.6% for Oct 2026 move-outs, LA 3.03% for 2026; Oakland explicitly does not accrue interest.
The statute that governs deposits in California, Cal. Civ. Code §1950.5 (statewide — no interest provision); SF Rent Ordinance (S.F. Admin. Code ch. 37); Berkeley Rent Ordinance; Los Angeles Rent Stabilization Ordinance (LAMC §151.06.02(F)/(G) per LAHD bulletin), covers how and when the deposit itself must be returned — it simply does not mandate interest on top.
How interest must be paid
Annual simple interest. SF: paid annually on the tenant's annual due date. Berkeley: paid each December, due no later than January 31. LA: landlord elects monthly or yearly payment; any unpaid accumulated interest paid at deposit return. SF: annually on the tenant's annual due date; remainder at move-out. Berkeley: each December during tenancy (cash or rent rebate), due by Jan 31; move-out balance paid when tenant leaves. LA: monthly or yearly at landlord's written election, or at termination with the deposit.
Who the law applies to
Statewide: none (all rentals). SF: units covered by the Rent Ordinance; landlord may deduct 50% of the annual Rent Board fee from interest owed. Berkeley: units fully or partially covered by the Berkeley Rent Ordinance; 10% penalty rate if annual interest not paid by Jan 31. LA: RSO units only, deposits held at least one (1) year; mobile home parks exempt.
Cities in California that require interest
San Francisco: current rate 4.2% effective 3/1/2026–2/28/2027 (sf.gov Rent Board report + news announcement 1/9/2026). Berkeley: Dec 2025 annual rate 0.9%, Oct 2026 move-out rate 0.6%, 10% penalty interest if annual payment not made by Jan 31 (official Rent Board calculator page). Los Angeles: RAC-set rate 3.03% for 2026; two methods allowed (RAC simple rate or actual amount earned, bank statement required for the latter); accrual began 11/1/1990; year-2002 waived; mobile home parks exempt (official LAHD bulletin PDF). Oakland: 'Security deposits in Oakland do not accrue interest' (official RAP Info Sheet – Security Deposit, 7/8/2024).
States that do require deposit interest
California has no statewide requirement — its cities are covered above. If you are moving or own rentals across state lines, these states do — each rate is the statutory value verified on the state page:
| State | Statutory rate |
|---|---|
| Massachusetts | 5% per annum, or the lesser amount of interest actually received from |
| Ohio | 5% per annum |
| Maryland | greater of 1.5%/year or U.S. Treasury 1-year yield curve rate (leases |
| Minnesota | 1% per annum |
| New York | Interest actually accrued/paid on the deposit in the interest-bearing |
The statute behind it
| Field | Value | | --- | --- | --- | | Citation | Cal. Civ. Code §1950.5 (statewide — no interest provision); SF Rent Ordinance (S.F. Admin. Code ch. 37); Berkeley Rent Ordinance; Los Angeles Rent Stabilization Ordinance (LAMC §151.06.02(F)/(G) per LAHD bulletin) | | Official text | leginfo.legislature.ca.gov | | Last verified | 2026-10-28 |
⚠️ SF ordinance precise section number (S.F. Admin. Code ch. 37, §37.10) not quoted from code text this session — rule and current rate verified via sf.gov Rent Board pages Berkeley Municipal Code chapter number for the interest provision not opened (rentboard.berkeleyca.gov page cites 'Berkeley Rent Ordinance' generically); rates/deadline verified on official page
Statutes get amended. If you are relying on this page — for a move-out, a dispute, or a lease draft — click through to the official text and confirm the current wording.
FAQ
Does California require landlords to pay interest on security deposits?
Not statewide — but some cities do. San Francisco: current rate 4.2% effective 3/1/2026–2/28/2027 (sf.gov Rent Board report + news announcement 1/9/2026). Berkeley: Dec 2025 annual rate 0.9%, Oct 2026 move-out rate 0.6%, 10% penalty interest if annual payment not made by Jan 31 (official Rent Board calculator page). Los Angeles: RAC-set rate 3.03% for 2026; two methods allowed (RAC simple rate or actual amount earned, bank statement required for the latter); accrual began 11/1/1990; year-2002 waived; mobile home parks exempt (official LAHD bulletin PDF). Oakland: 'Security deposits in Oakland do not accrue interest' (official RAP Info Sheet – Security Deposit, 7/8/2024).
How is deposit interest calculated in California?
At Varies by city. Annual simple interest. SF: paid annually on the tenant's annual due date. Berkeley: paid each December, due no later than January 31. LA: landlord elects monthly or yearly payment; any unpaid accumulated interest paid at deposit return. The calculator at the top of this page applies exactly this rule to your deposit amount and dates.
When do I get the interest?
SF: annually on the tenant's annual due date; remainder at move-out. Berkeley: each December during tenancy (cash or rent rebate), due by Jan 31; move-out balance paid when tenant leaves. LA: monthly or yearly at landlord's written election, or at termination with the deposit.
Can my lease require the landlord to pay interest anyway?
Yes — a lease can always give you more than state law requires, never less. If your California lease promises interest, that promise is enforceable as a contract even though no statute mandates it.
Independent second source · 2026-10-28Related guides
- All states: security deposit interest by state · rent increase rules by state
- Tools: deposit interest calculator · rent increase calculator
- Neighboring states: Alaska · Hawaii
- Also moving? Read California rent increase rules.
This page is information, not legal advice — see the full disclaimer.