Oregon Security Deposit Law: Limits, Deadlines & Deductions

State law versus Portland

Oregon’s deposit statute, ORS 90.300, applies everywhere in the state. It sets no cap and no interest requirement, and focuses on what you can deduct and how fast you account for it.

Portland layers its own rules on top, including deposit caps, screening rules under its FAIR ordinance, and detailed move-in and move-out requirements. If your rental is inside Portland city limits, treat this page as the floor and read the city’s code too. Everything below is the statewide rule.

Setting the amount

With no statewide cap, the deposit is a market decision. One month’s rent is common. A few things to keep straight:

• Pet deposits. You can take a refundable pet deposit; it goes through the same 31-day accounting. You can’t charge one for an assistance animal under fair housing rules.
• Labels matter. Call each payment what it is in the lease. A refundable deposit is held for the tenant. Last month’s rent paid in advance is rent.
• Consistency. If you require a larger deposit from some applicants, base it on legitimate screening criteria and apply it the same way to everyone.

Oregon’s statewide rent stabilization and its first-year limits on no-cause terminations don’t change the deposit rules, but they do mean a tenant may stay longer than you planned. Keep good records from day one.

The 31-day accounting

The 31 days start when the tenancy ends and the tenant delivers possession. Within that window, return the deposit or give the tenant a written accounting that states the basis for each deduction, along with the balance. Deliver it personally or by mail to the tenant’s last known address, and keep a record.

If the tenant leaves without a forwarding address, send the accounting to the rental’s address anyway; it shows you met the deadline, and mail is often forwarded. Keep a copy of everything you send and a record of the date.

An accounting that holds up looks like this: “Replace cracked bathroom mirror, $140 (invoice attached). Remove abandoned furniture and haul to dump, $95.”

What you can deduct

You can apply the deposit to unpaid rent and to damage beyond ordinary wear and tear that the tenant caused. Two Oregon-specific points:

• Carpet cleaning is limited by statute. A flat carpet-cleaning charge on every move-out is the kind of deduction that gets challenged. Check ORS 90.300 for the current conditions before you write one into a lease, and keep the invoice.
• Moisture problems are a common argument. Mildew on bathroom ceilings and window frames is frequent in western Oregon. Whether it’s the tenant’s fault or a ventilation problem with the building is often unclear, so be careful charging for it.

Some examples from a 1970s ranch in Salem:

Usually wear and tear	Usually damage
Faded paint, small nail holes	Large holes from wall anchors, unapproved paint colors
Worn carpet in walkways	Pet urine soaked into carpet pad
Loose cabinet hinges from age	A broken cabinet door, a cracked mirror
Weathered deck stain	A burned deck board from a grill

A worked example at $1,600 a month

Your Salem house rents for $1,600. You collected a $1,600 deposit and a $300 refundable pet deposit, so you hold $1,900. The tenancy ends June 30 and the tenant returns the keys that day with a forwarding address.

At the walk-through, with dated photos:

• Pet urine in the bedroom carpet and pad: $420 to replace that room’s carpet and pad (installer’s invoice)
• A cracked bathroom mirror: $140
• Faded paint and worn hallway carpet: $0, ordinary wear and tear
• Rent: paid in full

Deductions total $560. You mail a written accounting with both invoices and a refund of $1,340 by July 31.

Getting it wrong

If you fail to return the deposit or account for it as the statute requires, the tenant can recover twice the amount wrongfully withheld. On the $560 above, an unsupported deduction could cost $1,120. Oregon landlord-tenant cases can also shift attorney fees to the winning side, which raises the stakes on small claims.

This page is general information, not legal advice. For a contested deposit, check with an Oregon landlord-tenant attorney or the Oregon State Bar’s lawyer referral service.