Philadelphia property managers are dealing with a wave of new tenant protection laws that took effect in December 2025. If you're not up to speed on these changes, you could be looking at serious legal trouble and financial penalties. The good news? Most of these requirements are straightforward to follow once you know what they are.
Here's what you need to know to stay compliant and keep your properties profitable.
The $50 Application Fee Rule Is Already In Effect
As of December 3rd, 2025, you can't charge more than $50 for rental applications – or the actual cost of background and credit checks, whichever is less. This applies to any 12-month period, so you can't get around it by charging multiple fees to the same applicant.
What this means for you:
- Set your application fee at $50 maximum
- Document your actual screening costs (they might be less than $50)
- Track fees charged to each applicant over 12 months
- Train your leasing team on these limits immediately
The risk: Violating this seemingly simple rule can trigger tenant lawsuits and regulatory penalties. Some property managers are already facing claims for overcharging application fees under the old system.
Security Deposit Installments: The New Reality
Here's where things get more complicated. If you own or manage 3 or more units, you must now allow tenants to pay security deposits in installments when the deposit exceeds one month's rent.
The breakdown works like this: tenants pay one month's rent worth upfront, then spread the remaining amount over three equal monthly payments.
Example:
- Monthly rent: $1,500
- Security deposit: $3,000 (two months' rent)
- Tenant pays: $1,500 upfront + $500/month for three months
Your action plan:
- Update all lease templates to include installment language
- Create automatic payment systems for installments
- Build clear payment schedules into lease agreements
- Keep detailed records of all installment payments
The risk: Failing to offer this option (for 3+ unit owners) can result in discrimination claims and regulatory violations. Some tenants are already using this as grounds to challenge evictions.
Source of Income Discrimination Is Now Illegal
Philadelphia's Fair Practices Ordinance now explicitly protects tenants who use Section 8 vouchers or other housing assistance. You cannot refuse applicants based on their income source, and you can't advertise that you don't accept vouchers.
More importantly, you must complete voucher paperwork promptly. Delays in processing can be seen as discrimination.
Compliance steps:
- Remove any "no Section 8" language from listings
- Process voucher paperwork as quickly as market-rate applications
- Train staff on fair housing requirements
- Document consistent application of policies
The risk: Source of income discrimination lawsuits are becoming more common, and they carry significant financial penalties plus legal costs.
Eviction Diversion: Try Before You File
Before filing eviction proceedings, you now must attempt out-of-court resolution with tenants. This includes offering repayment plans and exploring mediation options.
What this looks like in practice:
- Send formal notice offering payment plan options
- Document all negotiation attempts
- Explore mediation through city programs
- Keep records of tenant responses (or lack thereof)
The strategy: Many property managers are finding that structured repayment plans actually work better than evictions for recovering rent and keeping units occupied. The key is having clear terms and automatic payment systems.
Licensing and Certification Requirements Are Stricter
All rental properties need proper licensing and certifications. The penalties for non-compliance have gotten more serious – including daily fines and losing your right to collect rent or pursue evictions.
Required documentation:
- Commercial Activity License and Business Tax Account (renewed annually)
- Rent Suitability Certificate (for each new tenancy)
- Lead Paint Certification (pre-1978 properties or those with children)
- Bed Bug Certification (every new tenancy)
The compliance system that works:
- Set up a calendar tracking all renewal dates
- Conduct quarterly property inspections
- Address code violations immediately
- Keep digital copies of all certifications accessible
The risk: Properties operating without proper licenses face escalating daily fines, and you lose legal standing in eviction proceedings.
Documentation Is Your Best Defense
The thread connecting all these requirements is documentation. Whether it's application fees, security deposits, discrimination claims, or eviction diversion attempts, you need clear records of everything.
Essential documentation includes:
- All financial transactions with tenants
- Communication attempts and tenant responses
- Compliance efforts and good-faith negotiations
- Property inspection reports and violation remediation
- Staff training records on new requirements
What Property Managers Are Getting Wrong
The most common mistake we're seeing is treating these as minor administrative changes. Property managers who approach compliance casually are the ones getting hit with lawsuits and penalties.
Common errors:
- Using outdated lease templates
- Inconsistent application of new policies
- Poor staff training on discrimination laws
- Inadequate documentation of compliance efforts
- Reactive rather than proactive approach to violations
Making Compliance Work for Your Business
Smart property managers are using these changes as an opportunity to strengthen their operations. Better documentation systems, clearer tenant communication, and proactive maintenance actually improve tenant relationships and reduce turnover.
The properties that are thriving under these new rules are the ones that:
- Invested in updated systems and training
- Created clear processes for each requirement
- Maintain consistent communication with tenants
- Address issues proactively rather than reactively
Getting Professional Support
Managing compliance across multiple properties while handling day-to-day operations can be overwhelming. Many successful property managers are partnering with experienced service providers who understand both the regulatory requirements and the practical challenges of implementation.
The key is working with partners who can help you maintain compliant properties through proactive maintenance, proper documentation, and responsive service that keeps tenants satisfied and reduces legal risk.
Whether you're dealing with security deposit management, compliance documentation, or maintaining properties that pass inspections consistently, having reliable professional support makes the difference between struggling with new regulations and using them as a competitive advantage.
If you're looking to protect your properties and ensure compliance with Philadelphia's evolving tenant protection laws, let's discuss how C&A Property Services can support your operation with the systems and expertise you need to stay ahead of these requirements.
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