Oregon Is First With State Wide Rent Control

By
Real Estate Broker/Owner with Bend Premier Real Estate 200009031

How Will State Wide Rent Control Impact Rentals?

Oregon has the distinction of becoming the first state in the United States to pass state wide rent control. California attempted to do this last fall, but it failed at the ballot box. Several large American cities, such as New York, have rent control laws, but no state until now.

The law as written will limit the rent increase in to 7% above the annual change in the consumer price index. It also prohibits landlords from terminating month-to-month leases without cause after 12 months of occupancy. There is an exception to this last - for those tenants who receive three lease violations within a 12 month period and the landlord provides them written notice within 90 days.

How this new law will impact tenants and landlords remains to be seen with experts on both sides of the law split on their predictions. Within our brokerage, we have already heard of landlords selling their rentals due to the new law and potential buyers of investment property deciding to purchase in other states. The fear is the need to raise a rent above the cap due to needed repairs or changes in the economy will result in deferred maintenance and fewer rental units being built.

Landlords have no time to study the impacts of the law as there is no grace period to implement the changes; landlords could find themselves in violation today.

 

Original blog can be read at Bend Premier Real Estate's blog page.

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Rainmaker
171,904
Lauren Williams, CPO
Casual Uncluttering LLC - Woodinville, WA
Professional Organizer: Puget Sound homes

@LyLynnea Miller It's been a very very long time since I lived in NYC, and I only barely paid attention in NY, but I do remember some of my MBA courses using it as an example of piss-poor lack of understanding basic supply and demand, and incentives. You had everything from wealthier people briding their way into a rent-controlled apartment to landlords abandoning buildings because they couldn't afford repairs. A monumentally more effective approach is to facilitate the conversion of buildings to rental units: for example, here in Seattle there are blocks and blocks of mandated-by-law as single family mansions which could readily be converted to 4- or 6- units of comfortable single bedroom apartments. But nope. Sigh.

Mar 01, 2019 06:00 PM #1
Rainmaker
3,218,111
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

Hello Lynnea -- we will be watching/listening/learning as Oregon deals with the ramifications of this change.  Keep us posted.  

Mar 01, 2019 06:04 PM #2
Rainmaker
790,001
Mel Ahrens, MBA, Kelly Right Real Estate
Kelly Right Real Estate - Hood River, OR
Customized Choices for your Real Estate Needs

Our legislators should know it is about supply and demand, not limiting the revenue/costs. There have been plenty of economic studies showing rent control makes the problem worse.  This was a political move rather than a well thought out economic response to the problem.

Mar 01, 2019 06:11 PM #3
Rainmaker
3,153,631
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Lynnea, my condolences to you and your investors... Los Angeles, Santa Monica and West Hollywood have strong rent control  regulations and issues and any savvy investor does not want to buy Income Properties. Any investor who is savvy is looking to  buy in Glendale where there are no restrictions.... Instead of Rent Control the politicians need to get smart and loosen the restrictions on building to solve the Housing Crisis. I came from a Communist Country  fifty plus years ago and take my word it did not work....Endre

Mar 01, 2019 10:07 PM #4
Rainmaker
1,267,066
Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Property Manager

Hi Lynnea,
This is such an important post and should be a warning to those in other states.  Thanks for the post.  

Mar 02, 2019 04:17 AM #5
Rainmaker
2,943,051
Nina Hollander
Coldwell Banker Residential Brokerage - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

Good morning, Lynnea... well, I guess someone had to be first! Sorry it had to be Oregon. I have a feeling this might come back to bite people in the you know what at some point. Restrictions on free market activity are not a good thing in my book.

Mar 02, 2019 06:43 AM #6
Rainmaker
2,756,120
Kathleen Daniels
KD Realty - 408.972.1822 - San Jose, CA
San Jose Homes for Sale-Probate & Trust Specialist

This just leaves me shaking my head. As others have stated, unintended consequences are on the horizon.  

Mar 02, 2019 09:04 AM #7
Rainmaker
378,221
Lynnea Miller
Bend Premier Real Estate - Bend, OR
Premier Real Estate Service in Central Oregon

Hi Mel Ahrens, MBA, Kelly Right Real Estate - of course it was a political move, as those of us from Oregon know.  And with no check now in the state legislature, we can anticipate more of this type of law being passed for the next two years at a minimum.

Mar 02, 2019 12:05 PM #8
Ambassador
3,153,615
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

I read this earlier, Lynnea and didn't get to comment. I feel for you and know you are so disappointment. Government involvement in free trade is not the type of government we're used to here in the US. I shutter to think of the consequences of this.  

Mar 04, 2019 06:45 AM #9
Rainmaker
378,221
Lynnea Miller
Bend Premier Real Estate - Bend, OR
Premier Real Estate Service in Central Oregon

Hi Debe Maxwell, CRS . My thought is that statewide rent control will spread like cannabis use. Originally it would only be used for medical needs.  Once they got their foot in the door, it became easy to move to recreational use. Once one state has statewide rent control, it will spread to others - especially those blue states.

Mar 04, 2019 07:32 AM #10
Ambassador
2,168,995
Wanda Kubat-Nerdin - Wanda Can!
Prado Real Estate South - St. George, UT
So Utah Residential, Referral & Relocation REALTOR

Socialism is well on it's way...if this goes through, it starts in your state and then those people who are unwilling (not unable) to work will be given free housing for life and then this will become a domino effect except for the states that say enough is enough. I sure hope it doesn't. No landowner should be told how much to rent out a property - rights are being trampled, just like other things thanks to a state government that will do anything they please at any cost with zero accountability. While the majority of people do nothing...

Mar 04, 2019 05:58 PM #11
Rainmaker
378,221
Lynnea Miller
Bend Premier Real Estate - Bend, OR
Premier Real Estate Service in Central Oregon

Wanda Kubat-Nerdin - Wanda Can! - I am so in agreement with you. I started having a discussion last night with my husband about leaving Oregon. As much as we love our lifestyle here in Central Oregon, the craziness of the state is impacting us - mostly due to changes from California transplants who are now in positions of power in the state legislature and turning us into the state they left behind.

Mar 05, 2019 09:48 AM #12
Ambassador
2,168,995
Wanda Kubat-Nerdin - Wanda Can!
Prado Real Estate South - St. George, UT
So Utah Residential, Referral & Relocation REALTOR

The old adage of 'give an inch, take a mile' is playing true in so many areas of the country right now. While AOC is so-called entertaining everyone with stupidity, there is much more going on behind the scenes that is being ignored. It is so sad that this is happening in your state Lynnea Miller. Hope it never does here, though, they are talking about adding a transfer fee on every sold property now. Sheesh!

Mar 05, 2019 09:57 AM #13
Rainer
326,862
Jim Smith
The Property Management Company - Round Rock, TX
Broker,CRS,GRI,RMP,CNE,TRLP

I am always amazed how a state settled by those looking for opportunities and escaping oppression, controls and laws (along with California), has become one of the biggest Nanny-State form of government in our country.  We looked at opening an office in your area five years ago; and after much research, realized it was far more trouble than it was worth.  Hopefully, this latest legislation will rally the Oregon Association of Realtors to step up their game with issues and mobilization.  I love the high desert region of Oregon; yet, I have lost my desire to own property there.

Mar 06, 2019 08:20 AM #14
Rainmaker
378,221
Lynnea Miller
Bend Premier Real Estate - Bend, OR
Premier Real Estate Service in Central Oregon

Hi Jim Smith .  OAR was unable to stop statewide rent control, although they tried.  We are digging a deeper ditch into craziness which may result in an exodus to Texas - which I know a lot of people are doing!

Mar 06, 2019 12:51 PM #15
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Lynnea Miller

Premier Real Estate Service in Central Oregon
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