Rent control not a disaster for landlords
Rent control is a dirty word among landlords, and, in most of the places it’s been tried, there is good reason for that. But a bill signed into law by Gov. Kate Brown Thursday is different in many ways, most notably in allowing landlords generous leeway to raise rents.
Even landlord groups refrained from vigorously opposing Senate Bill 608, because a potential alternative — lifting the state ban on local rent-control ordinances — could have been much worse. That ban remains in place, leaving the new statewide law the only control.
Minority Republicans opposed the bill, saying it would do nothing to increase the supply of rental housing. That’s true, but the bill wasn’t intended to do that. It was intended to protect renters from being forced out of housing by no-fault evictions or by double-digit rent increases they could not afford. There are other bills under consideration to address the supply issue.
Opponents also said the bill would decrease the supply of rental housing by discouraging new investment and prompting landlords to get out of the business. It’s hard to see how that will happen, given the numerous exemptions allowed under the new law.
For starters, new construction is exempt from caps on rent increases for 15 years.
For units older than 15 years, landlords may raise rents once a year by the increase in the Consumer Price Index plus 7 percent. This year, that translates into an increase of more than 10 percent — hardly draconian.
If renters move out of their own accord, landlords may reset the rent as high as they wish. The annual cap then applies to the next tenant.
For the first year of occupancy, landlords may still evict tenants without cause with 30 days’ written notice. After one year, they must show cause, such as failure to pay rent or damaging the unit. They also may evict tenants if they wish to move into the unit themselves or to conduct a major renovation. In those cases, they must provide 90 days’ notice and pay the tenant one month’s rent.
Owners of four or fewer units are exempt from the payment requirement, which protects so-called “mom and pop” landlords. And if a landlord’s main residence is on the same property as the tenant’s and the property has two or fewer units, the landlord may evict the tenant without cause even after the first year.
No one wants to see responsible property owners deprived of a reasonable return on their investment. At the same time, no one wants to see families forced into homelessness by rent increases they cannot absorb. In fact, tenants rights groups say the new law is too lenient, and some renters still may see increases beyond their ability to pay.
Overall, it appears lawmakers have struck a balance, protecting renters from the worst abuses while allowing landlords to continue to profit from their investments.