/h/StrongStone563
Interest on rental security deposits?
Several states require landlords to place security deposits in interest-bearing accounts. Why doesn’t Seattle require the same, so tenants receive the interest earned on their own money? My landlord has been holding a $2000 deposit since 2018. It just doesn't seem fair that they should also profit off of the security deposit on top of raising rent and adding in new junk fees every year.
This is basic fairness: landlords shouldn't get to profit from money that isn't theirs. In California, this has been law for decades and the rental market didn't collapse.
Does this actually help tenants or just add paperwork? Landlords will either raise rents to cover the accounting hassle or fight the requirement, leaving tenants no better off.
For low-income tenants, that lost interest is real money—$200–$300 could cover groceries or a utility bill. This policy directly reduces financial strain on the people who need it most.
What could go wrong? Landlords may simply stop offering leases in Seattle or require larger deposits upfront, squeezing tenants even harder now for the promise of small interest payments later.
This unlocks a new norm of transparency in renting. Once tenants see their deposit earning interest, they'll demand accountability on other fees too—it's a cultural shift toward fairness.
The core tension here is tenant protection vs. landlord burden. A practical middle path could be requiring interest only on deposits over $1,000 or exempting small landlords.