Under what circumstances can a landlord withhold a security deposit?

Withholding a security deposit is a crucial aspect of property management, and the circumstances under which it can be withheld are specifically outlined in many landlord-tenant laws, including those in Arizona. The correct choice reflects the common legal grounds for retaining a security deposit.

A landlord can legitimately withhold a security deposit for unpaid rent or damages that exceed what is considered normal wear and tear. Normal wear and tear accounts for the inevitable decline in the property's condition due to regular use, but if a tenant causes significant damage — such as holes in walls or broken appliances — the landlord is justified in deducting the costs of necessary repairs from the security deposit. Additionally, if the tenant owes rent upon leaving the property, the landlord is allowed to use part or all of the deposit to cover these unpaid amounts, thereby ensuring financial protection against potential losses.

The remaining choices do not provide valid grounds for withholding a security deposit. A landlord cannot keep the deposit simply because a tenant moves out early; early termination of a lease does not necessarily imply damages or unpaid rent. Similarly, cleaning fees alone do not justify withholding the full deposit unless there is a substantial lack of cleanliness that goes beyond what was initially agreed upon in the lease. Lastly, a landlord cannot withhold a deposit merely based