Landlords' Responsibilities, Rent, and Security Deposits
Authored By: D.C. Bar Pro Bono Center
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Before I become a landlord, do I need to have a license? Am I required to register my property with the District?
Yes, in the District of Columbia, if you are renting out residential property, even if it is only a single room in your home, you are required to do the following before you begin renting out your property:
- Obtain a certificate of occupancy unless the property you are renting out is an apartment, cooperative unit, or condominium that is located in a building that already has a certificate of occupancy for the whole building or the rental property is an entire single-family home
- Obtain a housing business license
- File a registration or claim of exemption from the Rent Stabilization Program (rent control)
If you are already renting property and have not met these requirements, you are breaking the law. You may want to talk to a lawyer before you attempt to register your property to see if you can avoid incurring penalties when you register. There is more information below on how to complete these steps. For a summary of the licensing and registration requirements, click here.
How do I know if the property is under rent control?
The Rent Stabilization Program (rent control) applies to all residential rental units unless you have an exemption from the program. You are entitled to claim an exemption from rent control for a rental unit if:
- If you personally own (not through a business), either alone or with four or fewer other people (not businesses), four or fewer rental units and you have filed a claim of exemption; or
- You are receiving a local or federal rent subsidy or mortgage subsidy for the unit; or
- The rental unit has a building permit that was issued after December 31, 1975, or has an initial certificate of occupancy issued after January 1, 1980, as long as the construction of this new building did not require demolition of a rent-controlled building with the same or greater number of units
- The entire building in which the unit is located was continuously vacant since January 1, 1985, provided that, upon re-rental, the building is in compliance with the D.C. Housing Regulations.
Even if you are entitled to an exemption as a "small landlord" who owns four or few rental units, you must file paperwork to get an exemption number in order to be able to raise the rent and conduct business as a landlord. Landlords who qualify for the other exemptions also may file paperwork to get an exemption number.
Some types of units are excluded from rent control entirely. These include: hospitals, nursing homes, dormitories, rental units operated by foreign governments, and certain units operated by non-profit organizations that provide social services to residents.
Where do I file a registration statement or claim of exemption from the Rent Stabilization Program (rent control)?
You should contact the Rental Accommodation Division of the Department of Housing and Community Development. The phone number is (202) 442-9505 and the office is located at 1800 Martin Luther King, Jr. Avenue, SE, Washington, D.C. 20020.
How do I get a Certificate of Occupancy?
Contact the Office of the Zoning Administrator of the Department of Consumer and Regulatory Affairs. The phone number is (202) 442-4400. You will need to submit an application, a pre-occupancy data sheet, and a $36.30 application fee. An additional fee of at least $42.00 is required when you pick up the Certificate of Occupancy. In most cases, an inspection of the property is required prior to the issuance of the Certificate of Occupancy. There is additional information on the Department of Consumer and Regulatory Affairs website.
How do I get a housing business license?
The licensing process depends on the type of property you are renting:
- One family rental units: single-family homes, town homes, duplexes, individual condominium units, or individual rooms
- Two family rental units: a building that contains two separate units, such as a house with an English basement apartment
- Apartment house: a dwelling that contains three or more units
The Department of Consumer and Regulatory Affairs is responsible for granting business licenses. Click here to access the application materials online. From the list of business types, select "One Family Rental," "Two Family Rental," or "Apartment House."
Who is responsible for making repairs to the unit?
The landlord is responsible for repairs, including those caused by normal wear and tear, except if the tenant or the tenant's guests caused the problems. If there are substantial housing code violations in the rental unit, the tenant may not be required to pay the rent or to pay the full rent, and you may be subject to civil and criminal liability for violating the housing code.
The tenant is responsible for keeping the unit clean and for using the fixtures and appliances properly. The tenant is also prohibited from destroying or damaging the unit, appliances, fixtures, and equipment intentionally or by serious neglect.
These are some of the potential consequences of failing to correct housing code violations:
- The tenant can request a housing inspector visit the property and make a report of all the housing code violations. The inspector will send a copy of the inspection report to you and instruct you to make repairs within a certain amount of time. If repairs are not made on time, you may be fined.
- The tenant can file a case on the Housing Conditions Calendar, in the Civil Actions Branch of the Superior Court, requesting that the Court order you to make repairs. A tenant cannot get a refund of rent in this court, but a tenant can file a separate case in Small Claims Court for up to $10,000. Click here for more information on how to file a case on the Housing Conditions Calendar.
- The tenant can file a regular case in the Civil Actions Branch requesting that you make repairs and requesting a refund in rent because the tenant paid too much for the rental during periods when housing code violations existed. (If the lawsuit only seeks money, and not an order to make repairs, the tenant must request more than $10,000 or the case must be filed in Small Claims Court.)
- If the housing code violations are severe (for example, no heat in winter), the tenant can immediately file in the Civil Actions Branch of Superior Court for a Temporary Restraining Order to get the heat restored, as part of a case on the Housing Conditions Calendar or a regular civil action.
- If the housing code violations are less severe, the tenant can file a Tenant Petition with the Rental Accommodations Division (RAD). This agency allows tenants to bring actions against their landlords. The rules and procedures are very informal and landlords and tenants usually do not need lawyers to proceed.
- The tenant can bring an action in Small Claims Court. If a tenant thinks that you should reimburse him or her for money the tenant spent fixing problems in the rental unit or that you owe the tenant money since the tenant paid too much for the rental during periods when housing code violations existed, the tenant can bring an action in Small Claims Court up to $10,000.
- The tenant can stop paying the rent. Because only landlords can bring an action in Landlord Tenant Court, the only way for tenants to get in front of a judge in this Court is to withhold their rent and wait to be sued by their landlords. Once you are in Landlord Tenant Court, the tenant can ask the judge to order you to make the repairs. The tenant may also be able to get a reduction in the rent he or she owes.
How do I request a housing inspection?
If you want to request that a housing inspector visit the property, either to have proof that the repairs have been made or are not needed or because the tenant is violating the housing code, you can request a housing inspection. To schedule an appointment, call (202) 442-4400. It is best that you are present during the inspection to point out to the inspector all the violations or repairs.
Can I raise the rent?
You cannot raise the rent if you and the tenant have agreed, usually in a written lease, on a certain amount. Usually, you and the tenant will agree on a certain amount for a specific period of time. Once that time period ends, you can raise your rent with 30 (thirty) days written notice. If you and the tenant never agreed on a specific period of time, you can usually raise the rent with 30 (thirty) days written notice.
If you are allowed to raise the rent, then how much and how often you can raise the rent depends on whether the unit is subject to rent control. If the unit is exempt from rent control, then you can raise the rent by any amount at any time, as long as you are not raising the rent for an illegal reason, such as to retaliate against the tenant for taking some lawful action like reporting housing code violations or requesting repairs. You must give the tenant at least 30 days written notice before the date on which you want the rent increase to take effect.
If the unit is subject to rent control, then you can raise the rent if:
- The last increase in rent was at least 12 months ago (unless the unit is vacant)
- The unit is properly registered with the RAD
- The rental unit and the housing accommodation's common elements are in substantial compliance with housing regulations
- You give a 30-day written notice of any increase in rent
In general, you can only raise the rent in a rent-controlled unit by a certain percentage each year. That percentage cannot be more than 10% and the exact amount that you can raise the rent each year is determined by the Rental Housing Commission and is based on the Consumer Price Index. You should contact the Rental Housing Commission at (202) 442-8949 to find out how much you can raise the rent.
If your rental property is not returning at least a 12% rate of return, you can ask the Rental Accommodation Division of the Department of Housing and Community Development to allow you to raise the rent by more than the amount approved by the Rental Housing Commission, instead of making the regular annual rent increase. To do this, you must file a "Hardship Petition," showing the equity you have in the property, the operating expenses, how much rent you are collecting, and other financial information. You should contact the Rental Accommodation Division at (202) 442-9505 to find out how to file a Hardship Petition.
Finally, if you are making certain types of capital improvements to the building, you can apply for permission to raise the rent to help pay for the improvements. You will need permission from the Rental Accommodation Division of the Department of Housing and Community Development to raise the rent for this reason. Contact the Rental Accommodation Division at (202) 442-9505.
What amount can I charge for a security deposit?
You may not charge more than the amount of one month's rent, and it may be charged only once.
Am I required to hold the money in a special account?
You must hold the deposit in an interest bearing account in a financial institution in the District of Columbia. The account must be for the sole purpose of holding security deposits. You can use the same account for more than one building. If the tenant rents the unit for at least twelve months, you are required to pay the tenant the interest accruing on the security deposit, subject to any lawful deductions. The interest rate is adjusted every six months (on January 1st and July 1st) to the statement savings rate at the bank where the account is held.
After the tenant vacates a rental unit, how much time do I have to return the deposit?
You have 45 days to either return the deposit with interest due, or notify the tenant in writing of your intention to withhold the deposit and apply it toward the cost of expenses properly incurred. Interest must be paid only on termination of tenancies of one year or more.
What can I use the deposit for?
In general, a landlord can use a security deposit to make sure the tenant has met his or her obligations under the lease. The landlord is required to state in writing what a deposit can be used for, either in a written lease or in a written receipt for the security deposit. You can, for example, state that a deposit can be used to pay for damage to the rental unit or if the tenant moves out while owing you money for rent.
You are responsible for paying for repairs to your rental unit, as long as the problems weren't caused by the tenant or the tenant's guests. If the tenant or the tenant's guests damaged the rental unit, even accidentally or by neglect, then the tenant is responsible for paying for the repairs. You are responsible for paying for normal maintenance and repairing damage that was not caused by the tenant or the tenant's guests.
What happens if I decide to keep some or all of the security deposit?
If you withhold the security deposit to defray the cost of expenses properly incurred, notice must be provided to the tenant in writing, delivered personally or by certified mail. Within 30 days after giving this notice, you must provide the tenant with an itemized statement of the repairs and other uses to which the monies were applied, with the cost of each item.
What action can the tenant take against me if I withhold a security deposit?
The tenant may file a lawsuit, usually in Small Claims Court, to try and compel you to return the proper amount. If you lose the case, a money judgment may be entered against you in the amount of the security deposit plus any damages.
What action can I take to recover for damage to an apartment greater than the amount of the security deposit?
You may file a lawsuit, usually in Small Claims Court, to try and obtain a judgment for the amount of damages that are greater than the amount of the security deposit.
Can I be penalized for not returning the deposit and/or for failure to provide notice?
If you do not return the deposit or provide the proper notices, and the tenant sues you for the unreturned portion of the deposit, you must prove that the tenant is not entitled to full return of the deposit and interest. The tenant may be entitled to what is called “treble damages”, or triple the actual money owed, if the court finds that you acted in bad faith. The term “bad faith” means any unfounded or dishonest reason for not returning the deposit. Forgetting to return the deposit, bad judgment, or an honest belief that you acted correctly is not bad faith.