California holding deposit
landlord tenant attorney California Aug 27, 2026
Location: California I’m located in CA and recently applied to an upstairs apartment on 8/4/26. The next day I was told we were approved and that I needed to come in to drop off a $1,000 “deposit” which I thought was a security deposit. I was trying to put my baby to sleep so my husband dropped it off. Turns out he signed a paper stating it was a holding deposit & that we would be charged if we backed out of renting it. The apartment is currently being renovated so it won’t be ready until mid Sept. We had originally wanted a downstairs unit since we have a small child and two weeks after paying our deposit the manager let us know we could view a downstairs apartment that had just become available. When we viewed it, it was so small and outdated compared to the upstairs unit. She then pointed out that my son may make noise that could bother the downstairs neighbors, we tested the noise level and agreed. It’s not a good fit after all, we told her we changed our mind and today she texted us saying they would be keeping the full amount plus more. She then offered to deduct $500 off first months rent and to offer a 6 month lease instead of 12 so that we wouldn’t “loose the deposit”. Money has been tight and I’m freaking out over the $1,066.66 that they’re keeping. After looking at the holding deposit agreement it states “Applicant's Failure to Enter into Rental/Lease Agreement. If Applicant, after approval, chooses not to enter into the Rental/Lease Agreement, Landlord may deduct from the holding deposit "lost rental damages" to cover the lost opportunity to rent the premises. Landlord and Applicant agree that "lost rental damages" will be 1/30th of the monthly rent specified above for each day the premises was taken off market (beginning on the date of this Agreement” Is the landlord able to charge rent fees for the unit although it’s off the market due to it being fully renovated? They are charging us rent fees for a unit that is uninhabitable and is not move in ready.
