In the high-turnover rental markets of Wilmington, Wrightsville Beach, and Jacksonville, the move-out inspection is often the most contentious moment of the landlord-tenant relationship. For property owners in New Hanover, Pender, Onslow, and Brunswick counties, the financial stakes are real. Misclassifying normal wear and tear as damage can trigger serious liability in a North Carolina dispute, while ignoring true tenant-caused damage erodes your coastal ROI.

The North Carolina Tenant Security Deposit Act sets the framework. The hard part is applying it to real life in a coastal climate where sun, sand, and salt accelerate deterioration and blur the lines.

Wear and Tear vs. Damage: The Practical Threshold

In North Carolina, landlords cannot charge tenants for normal wear and tear, meaning gradual, expected deterioration from ordinary, non-negligent use. Damage is deterioration caused by abuse, negligence, unauthorized alterations, or failure to follow basic care requirements.

Examples That Commonly Trigger Disputes

• Faded paint and flooring: Paint fading, minor scuffs, and traffic wear are usually wear and tear. In Topsail and other beach markets, UV exposure through large windows can bleach floors and walls faster, but that is still typically treated as wear, not tenant damage.
• The cleaning conflict: Dirt is not wear. If a tenant in Hampstead leaves sand-packed slider tracks, salt-crusted glass, grease buildup, or trash that requires professional remediation, those are typically cleaning charges, not “wear.”
• Mechanical lifecycle vs. neglect: HVAC failure from age is wear. A frozen coil or burnout tied to chronic filter neglect can support a damage deduction if you can document the causation.

What You Can Deduct a Security Deposit For

North Carolina allows security deposit deductions for specific categories like unpaid rent, fees allowed by the lease, damages beyond normal wear and tear, and costs tied to breach of lease obligations. The winning strategy is not arguing harder. It is documenting better.

Documentation That Holds Up in a Dispute

Under N.C. Gen. Stat. § 42-50, landlords win security deposit disputes with proactive records, not memories.

Move-In Baseline: Signed Checklist + Photos

Never hand over keys without a signed, dated move-in inspection checklist and a photo set that is organized by room. This locks in the baseline condition and collapses the he-said, she-said problem.

The 30-Day Rule and the 60-Day Finish

North Carolina’s timeline is strict. You have 30 days from move-out to provide either a final accounting or an interim accounting if you cannot fully quantify repairs yet. If you provide an interim accounting, you must follow with a final accounting within 60 days. In the Cape Fear region, contractor backlogs make interim accounting common, so your admin process needs to be tight.

Depreciation: Charge the Remaining Useful Life, Not Replacement

You generally cannot charge full replacement cost for an item that was already partway through its useful life. If a tenant ruins five-year-old carpet, the defensible approach is to charge the depreciated value tied to remaining useful life, not the cost of brand-new materials.

Your Next Step

Security deposits are won or lost on systems: condition baselines, clean timelines, and defensible math. Aspyre Realty Group helps investors across Southeastern North Carolina approach turnovers with professional precision and legal clarity so you protect the asset without creating avoidable exposure.