Image of cash, checkbook and a model home to represent paying a security deposit.

Security deposits are a necessary part of any lease, but they don’t have to be intimidating.

Security deposits—what are they, exactly? How do you get yours back? Can you argue a deduction to your security deposit?

Navigating the New York City rental market can be intimidating as a tenant or an owner, whether you’re doing it alone or acting through a reputable agency like New York Habitat. Security deposits are an especially contentious part of the rental market—they’re an investment, so both parties on a lease want to make sure they’re handled correctly. With so many legal intricacies, ownership laws, tenant protections, and types of rentals out there, it’s handy to have a simplified guide to let you know your rights as a tenant and what you should do to have the best rental experience possible!

Though we at New York Habitat do everything in our power to guarantee that your experience is positive, the unexpected can sometimes happen. Fortunately, we’ve come prepared to help with a series of guides to help avoid some of the most common confusions that arise for tenants and owners in New York City. Learn the ins and outs of the New York City rental market, and you’ll feel ready to rent a furnished apartment in no time.

Understanding the security deposit- So, what is it?

Image of a woman reading a document on a tablet.

Reading your lease carefully is an integral part of being a smart renter.

So you’ve finally closed in on the perfect apartment—congratulations! However, if it’s your first time renting in New York, it’s important to know that the price you see on the listing is not necessarily what you will pay up front. To secure your ideal apartment, you’ll need to pay a security deposit to the landlord.

A security deposit is necessary to secure a rental agreement—it ensures that you, the tenant, are committed to the apartment. It also provides security for the landlord (that’s where the name comes from!). A security deposit is used to protect the landlord’s property from damage or to cover any unpaid bills, but you can look at it as a renter’s protection as well. In the super-competitive New York rental market, a security deposit is also used to “lock in” your commitment to the apartment as a tenant.

Here are some fast facts about security deposits:

New York Habitat infographic describing important things to know about security deposits, including why one is needed, how much it costs, and when it is returned.

At a glance, here are 3 important things to know about security deposits.

You can also find more information about the limits of security deposits here with Nolo’s legal guide.

Simple enough, right? Now that you know what a security deposit is, it’s important to understand how yours will work.

“Was that in the lease?” How to read a rental agreement

The security deposit and the rental agreement go hand-in-hand. When a tenant agrees to rent an apartment, both the owner and tenant sign a contract that provides a set of rules for the duration of the renter’s time in the apartment. The rental agreement (or lease) is a legally binding contract that outlines the responsibilities and expectations of the owner, the renter, and the accommodation.

When you rent with New York Habitat, you’ll have the added security of an extra set of eyes to review the rental agreement with you and be there to answer any questions you may have. Be sure to ask questions on anything you’re confused about! Your agent, who has already helped you secure the right apartment for your needs and budget, will be happy to answer them.

When you know what to look for, there’s no need to worry! Here are some important tips to follow to help you read your rental agreement like a pro:

New York Habitat infographic describing tips for reading a rental agreement, including to read all parts carefully, pay attention to mandatory fees, and understanding deductions to the deposit.

Know what to look for when you read your rental agreement with these 3 tips.

If you disagree with anything in the rental agreement, you should ask for clarification. If you still disagree after clarifying, you shouldn’t sign the agreement. Owners should know that they have the right to use the security deposit to cover unpaid bills or cleaning and damages if the apartment is left in unsatisfactory condition (as long as they can provide a receipt).

Once you’ve signed the rental agreement and made a down payment, you’re good to go! Welcome to your new apartment. With some easy guidelines for your time as a renter and open communication with your landlord and agent, you can take all the necessary steps to get your security deposit back swiftly.

Tips for tenants: How to be a smart renter

Image of two people’s hands in the middle of a discussion over a rental contract.

It’s good to ask questions during the signing process. Your New York Habitat agent can help clarify things for you.

Protecting your security deposit doesn’t have to be hard! There are a series of easy steps you can take to be a smart, proactive, and respectful tenant. Follow our agent tips for the best results for your security deposit, and both you and your landlord can expect to be happy when it’s time to move out.

  1. Be careful and respectful with the apartment and the property! Remember, even though it may become your home for a few months, you are still living in someone else’s space. Treat it how you would like your property to be treated.
  2. Try to spot accidents before they happen to avoid accidental damage.
  3. One way you can do this is by using kitchen safety. Keep an eye on food while it’s cooking or baking, practice knife safety, use a hot plate or cutting board to protect countertops, etc.
  4. You should also avoid behaviors that may leave marks or stains. Don’t use unsafe adhesive for wall hangings, and avoid eating outside designated dining areas.
  5. If accidental damage happens, let the owner know as soon as possible. Communication is key!
  6. Clean up after yourself. Leaving the apartment clean helps avoid cleaning charges and set-in stain damage.
  7. Pay your rent on time and make sure all outstanding charges are paid upon move-out. Communicate with the owner or get in touch with your New York Habitat agent if there are any issues with payment.
  8. You must pay the owner until the end of the lease term in a furnished rental, unless you work out alternate arrangements with the owner.
  9. In the event of a deduction from your security deposit, ask for an itemized receipt so you can understand all charges.
  10. Tenants and owners can and should take pictures of the property upon check-in and move-out. Having photographic proof of the apartment’s condition can help settle any security deposit disputes quickly and easily.

When tenants and owners do their best to be transparent, communicative, and respectful, everyone wins! If you put these simple guidelines into practice, you’re almost guaranteed to have the most positive rental experience possible. For further reading about your rights as a tenant, consult this guide by New York State Attorney General Letitia James.

New York Habitat is here to help!

Of course, a security deposit is a pretty large sum of money, and when there’s a lot at risk, disagreements can happen. Fortunately, whether you’re a tenant or an owner, you won’t have to face any difficulties alone when you rent through New York Habitat. As an agency with 30 years of experience in the New York rental market, we are trained to navigate any security deposit issues that may arise by helping you make sense of local rental laws and helping you to understand the framework of any security deposit dispute. Here’s how:

If you disagree with any of the owner’s deductions, you have the option of opening a case with the Small Claims Court of NYC. Opening a case with the Small Claims Court is an easy procedure that does not require access to a lawyer, and fees are nominal (around $30).

At any point during your time as a tenant, you can feel free to reach out to New York Habitat, be it your agent or the Quality Assurance team, and we’ll be happy to put our expertise to work to find a solution.

When you know how security deposits work, you can rent in New York City with ease. Still looking for your perfect apartment? New York Habitat offers a variety of rentals for travelers, students, businesspeople, and more looking to live independently in New York City. Visit our website to learn more about how our agency can work for you!