Philadelphia's rental landscape just shifted dramatically. As we close out 2025, property management companies are scrambling to understand new regulations that took effect this December: and for good reason. Non-compliance isn't just about potential fines anymore; it's about avoiding costly lawsuits, maintaining your reputation, and keeping your business competitive in an increasingly regulated market.
Whether you're managing 50 units or 500, these seven new rental laws will directly impact your operations, tenant relationships, and bottom line. Here's what every property management company needs to know: and how partnering with the right property services team can keep you ahead of compliance challenges.
1. Application Fee Caps: The $50 Maximum Rule
Effective December 3, 2025, Philadelphia officially capped rental application fees at $50 or the actual screening cost, whichever is lower. This applies within any 12-month period, meaning you can't charge multiple $50 fees to the same applicant across your portfolio.
Here's the game-changer: if a tenant applies to multiple units within your management company, you can only charge one application fee total: not per unit. Previously, applicants could face $100+ fees for each property, creating significant barriers to housing access.
What This Means for Property Managers:
- Immediate revenue impact if you were charging higher application fees
- Need for updated application processes and fee structures
- Potential legal exposure if you're not compliant by December 3rd
The C&A Advantage: Our property management partners don't worry about compliance updates. We handle tenant screening processes as part of our comprehensive turnover services, ensuring your applications meet all new fee requirements while maintaining thorough vetting standards.
2. Security Deposit Installment Plans: Three-Payment Flexibility
The security deposit installment requirement fundamentally changes cash flow for properties with deposits exceeding one month's rent. Property managers with three or more units must now allow tenants to split security deposits into three equal monthly payments.
For example, if you typically charge two months' rent as a security deposit, tenants can now pay one month upfront and spread the remaining amount across three equal installments. This addresses the challenge many renters faced when needing to produce 3-4 months' rent upfront.
Compliance Risk: Non-compliance can result in statutory damages equal to one month's rent plus attorney fees.
What This Means for Property Managers:
- Modified lease agreement templates
- Updated accounting procedures for partial deposits
- New tenant communication protocols
The C&A Solution: We've already updated our lease processing and tenant onboarding systems to handle installment plans seamlessly. Our property management clients benefit from compliant lease templates and automated payment tracking that reduces administrative burden.
3. Mandatory Eviction Diversion: No Direct Court Filings
Philadelphia's permanent eviction diversion program requires landlords to engage in out-of-court mediation before filing for eviction. You cannot proceed directly to eviction court without first attempting to resolve disputes through this mandatory mediation process.
This program has significantly reduced eviction rates since its implementation, but it also means property managers need new procedures for handling non-paying tenants and lease violations.
What This Means for Property Managers:
- Extended timelines for resolving tenant issues
- Need for mediation-focused communication strategies
- Documentation requirements for attempted resolution efforts
How C&A Helps: Our maintenance and property services team often identifies tenant concerns before they escalate to non-payment issues. Through proactive maintenance response and tenant communication, we help property managers avoid situations that lead to eviction proceedings entirely.
4. Proposed Rent Increase Limitations: The 10% Annual Cap
While still pending as House Bill 72, the proposed 10% annual rent increase cap could become law in early 2026. Property managers should prepare for this limitation on year-over-year rent increases, which could significantly impact revenue planning strategies.
What This Means for Property Managers:
- Revenue forecasting limitations
- Need for alternative value-add strategies
- Increased focus on tenant retention versus turnover
C&A's Strategic Approach: Rather than relying solely on rent increases, our property improvement services help managers increase property values through strategic upgrades, energy efficiency improvements, and amenity additions that justify market-rate pricing within legal limits.
5. Enhanced Lead Paint Compliance Documentation
Philadelphia has strengthened lead paint disclosure and remediation requirements for properties built before 1978. Property managers must now maintain more detailed documentation of lead inspections, tenant notifications, and any remediation work performed.
What This Means for Property Managers:
- Expanded record-keeping requirements
- Potential liability for incomplete documentation
- Need for certified lead-safe work practices during maintenance
C&A's Compliance Expertise: All our maintenance technicians are trained in lead-safe work practices, and we provide comprehensive documentation for every service performed in pre-1978 properties. This includes detailed work orders, photo documentation, and compliance certificates that protect property managers from liability.
6. Property Inspection Standards and Timelines
New regulations have tightened property inspection requirements and response timelines for both routine inspections and tenant-requested maintenance. Property managers must now respond to tenant maintenance requests within specific timeframes based on issue severity.
Categories and Response Times:
- Emergency issues: 24 hours
- Health/safety concerns: 72 hours
- General maintenance: 7 days
- Cosmetic issues: 30 days
What This Means for Property Managers:
- Need for 24/7 emergency response capabilities
- Categorization systems for maintenance requests
- Documentation of response times and completion dates
Why C&A Partners Stay Compliant: Our emergency response system operates 24/7, and we maintain response time documentation automatically. Property managers receive real-time updates on maintenance requests and completion status, ensuring they meet all regulatory timelines without micromanaging every service call.
7. Tenant Communication and Notice Requirements
Updated tenant communication requirements now mandate specific notice formats, delivery methods, and timelines for various property management activities including rent increases, lease renewals, maintenance access, and policy changes.
Key Requirements:
- Written notice for all significant communications
- Specific language requirements for certain notices
- Proof of delivery documentation
- Translation requirements for non-English speaking tenants
What This Means for Property Managers:
- Updated template library for all tenant communications
- New tracking systems for notice delivery
- Potential language services for diverse tenant populations
C&A's Communication Support: We provide standardized notice templates that meet all regulatory requirements and maintain delivery documentation for maintenance-related communications. This reduces the administrative burden on property managers while ensuring compliance.
Implementation Timeline and Next Steps
Most of these regulations took effect December 2-3, 2025, applying immediately to new rental applications and lease agreements. Property managers have a narrow window to update their procedures and systems before facing potential compliance issues.
Immediate Action Items:
- Update application fee structures and processes
- Modify lease templates for security deposit installments
- Implement maintenance response time tracking
- Review and update tenant communication templates
- Ensure lead paint compliance documentation is current
- Prepare for potential rent increase limitations
- Establish eviction diversion procedures
The Partnership Advantage
Managing compliance across seven new regulatory areas while maintaining day-to-day operations requires significant resources and expertise. Property management companies that try to handle everything in-house often find themselves overwhelmed, non-compliant, or both.
C&A Property Services has spent over 30 years building systems and expertise specifically designed to keep property managers ahead of regulatory changes. From emergency maintenance response that meets new timeline requirements to comprehensive turnover services that handle application fee compliance, we provide the infrastructure property managers need to focus on growing their business rather than chasing compliance requirements.
Ready to ensure your properties stay compliant while maximizing operational efficiency? Contact C&A Property Services to discuss how our comprehensive property management support services can help you navigate Philadelphia's evolving regulatory landscape. Our team is already equipped to handle all seven new compliance areas, letting you focus on what you do best: managing properties and serving clients.
Visit capropserv.com to learn more about our property management partnership solutions and schedule a consultation with our compliance experts.
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