2026 Hot Topic: Security Deposit Laws in Virginia
When it comes to security deposits, full legal compliance is crucial. Misunderstanding the rules and regulations surrounding security deposits in Virginia can land landlords in legal trouble. The best way to ensure compliance and maximize rental success is to partner with a professional property management team.
For landlords, collecting a security deposit is one of the most effective ways to protect your rental property. Security deposits serve multiple purposes, reducing financial risk and maintaining the condition of your unit.
- Cover unpaid utilities: Virginia law allows landlords to deduct unpaid utility balances from the deposit.
- Offset cleaning costs: Deposits can cover excessive cleaning due to tenant neglect.
- Protect against unpaid rent: Missed rent or late fees may be deducted from the deposit.
- Recover losses from lease breaks: Deposits can offset financial losses if a tenant leaves early.
- Repair damages beyond normal wear and tear: Broken fixtures, large holes in walls, or other damage caused by tenant negligence are deductible.
Virginia Security Deposit Law: A Simple Guide
Navigating Virginia’s security deposit laws can feel overwhelming. Here’s what landlords need to know for 2026:
Security Deposit Limits in Virginia
Virginia law caps security deposits at two months’ rent for all residential leases. Landlords may charge the full amount to cover potential losses or less to stay competitive—but exceeding the legal limit is never allowed.
Nonrefundable Fees
Landlords may charge application fees or pet fees, but these must be clearly identified as nonrefundable in the lease. Security deposits themselves must remain refundable, except for lawful deductions. Keeping refundable and nonrefundable charges separate prevents confusion and legal disputes.
Storing Security Deposits
Virginia does not require landlords to use a special escrow account or pay interest on deposits. However, many property managers recommend dedicated accounts to simplify accounting, prevent misuse, and maintain clear records. Century 21 Accent Homes Property Management can help landlords implement professional deposit-handling systems.
Documenting Deposits
Although Virginia law does not mandate a written receipt, documenting the deposit amount in the lease is best practice. Accurate records make move-out inspections smoother and support any deductions.
Security Deposit Refund in Virginia
Virginia law sets a firm deadline for returning a tenant’s security deposit:
- Refund the deposit or the remaining balance after deductions within 45 days of the tenant vacating and surrendering the property.
- Provide an itemized written list of deductions, including receipts or cost estimates where applicable.
If a landlord fails to return the deposit or provide the required statement within 45 days, they may lose the right to make deductions and could be liable for damages and legal fees.
If a tenant does not provide a forwarding address, the landlord must hold the deposit until contact is made. After one year, unclaimed deposits may need to be transferred to the state as unclaimed property.
Change in Property Ownership
When a rental property changes hands, the new owner becomes responsible for the tenant’s security deposit. The outgoing landlord must transfer the deposit, including any interest and records, to the incoming landlord.
The new landlord then assumes full responsibility for Virginia’s landlord-tenant laws, including refunding deposits and providing itemized deductions at the end of the tenancy. Proper documentation during transfer ensures both landlords remain compliant.
Move-Out and Walk-Through Inspections
Virginia requires landlords to give tenants the option to attend the final inspection:
- Written notice must inform the tenant of their right to be present within five days of notice to vacate or a landlord’s request for move-out.
- Tenants must respond in writing if they wish to attend.
- The move-out inspection occurs within 72 hours after the tenant vacates and returns possession.
While not legally required, conducting a move-in inspection is highly recommended. Documenting the property’s condition with photos and written notes ensures transparency and supports any deductions.
Partner with a Property Management Team for Compliance
Navigating Virginia’s security deposit laws can be complex, and errors can be costly. Partnering with a professional property management team ensures full legal compliance, accurate accounting, and smoother tenant relations.
With the right systems, landlords can protect their investments, reduce disputes, and maintain profitable, well-managed rental properties. Century 21 Accent Homes can help with security deposits, inspections, and tenant communication every step of the way.
Conclusion
Understanding Virginia’s security deposit rules is essential for protecting your investment and maintaining positive tenant relationships. Missing deadlines, withholding funds improperly, or failing to provide required documentation can lead to legal issues and financial penalties. Partnering with an experienced property management company ensures compliance and peace of mind.
Disclaimer: This blog is not a substitute for legal advice from a licensed Virginia attorney. Laws change frequently, and this post may not be updated at the time of your reading. Contact us if you have questions about this content or any other aspect of your property management needs.
