Oregon Rent Increase Capped At 9.9% For 2022

Amidst changing evictions and tenant screening legislation, predicting what new challenges 2022 will bring is difficult for Oregon landlords. State economists announced in September that the Oregon rent increase limitation for 2022 is capped at 9.9%. This amount is just over the 22-year average of year-by-year rent increases, at 9.3%. For landlords considering rent increases for next year, this information will guide how their rental income might change. However, the nuances of Oregon rent control laws mean that there are more factors to consider before raising rents. 

A Look At Oregon’s Rent Control Laws

These restrictions on rent raises are relatively recent. In February 2019, the state passed Senate Bill 608 which capped annual Oregon rent increases to seven percent plus inflation. Generally, the inflation rate has ranged between one and three percent in recent years, as defined by the Consumer Price Index. As a result, the average annual limit on rent increases is generally between eight and 11 percent. 

Oregon’s laws around rent control are unique in the country. California has statewide limitations on rent, and three other states practice non-statewide rent control. However, Oregon remains the only state with true statewide rent control. 

In an attempt to encourage developers to continue building new rentals, Oregon’s rent increase laws only apply to homes that are more than 15 years old. However, keep in mind that this 15-year limit is a moving target. If your unit is 14 years old, it will age into the rent control restrictions next year. So keep track of your property’s age and when SB 608’s limitations will kick in, or risk facing legal consequences.

The penalties for breaching Oregon’s rent controls are steep. If a property owner raises rents above the maximum limit, they will be penalized for three months’ rent, the difference in rent charged to the tenant, and any legal costs. Rather than risking a hefty fine, it’s always wise to ensure that your rental policies comply with the law. 

COVID-19 Created Further Restrictions To Rent Increases

The pandemic raised even more questions about whether landlords will be permitted to increase rents. For all of 2021, landlords have been unable to raise rents for tenants receiving Section 8 vouchers. Tenants benefiting from the Housing Choice Voucher Program (also known as Section 8) can access government subsidies for private housing as long as they earn 30 percent of the area’s median income. Nearly 9,400 households and 2,600 landlords currently participate in the program, which Home Forward manages. In an attempt to protect Oregon’s most vulnerable and low-income renters, Home Forward protected Section 8 tenants from any rent increase for all of 2021 and much of 2020. It’s still unclear whether Home Forward will permit landlords to raise rent on Section 8 tenants in 2022. 

Balance Is Key For Portland Landlords

No tenant is happy to hear that their rent is going up. However, steadily increasing rent is a sign of a healthy economy and booming market. Rent increases are also necessary to keep up with inflation and a rising cost of living. Balancing the need to keep up with the market while not pricing out tenants is difficult for many landlords. Focusing on resident retention is a great way to build a financially stable rental business in the Portland market.

In the balance of income and costs, avoiding vacancies between tenants is essential to your bottom line. Constant tenant turnover, whether from quickly increasing rent, spotty property maintenance, or poor communication with renters is always bad for business. The key is to find the right compromise between profit and stability. By creating a flexible budget informed by ever-changing conditions, Portland landlords can stay competitive and profitable.

If striking that balance sounds challenging, there are good reasons for that. With the numerous federal, state, and local laws which impact property management in the Portland rental area, there are many considerations for landlords to keep in mind on top of the usual management challenges. COVID-19 and its accompanying rental legislation have added a new layer of difficulty to an already complicated business. If you’re feeling overwhelmed or uncertain how to proceed in your business, it may be time to consider hiring a property manager. 

Rent Portland Homes Can Help

Dealing with legal challenges is stressful and costly. But staying up to date on the nuances of Portland’s property management laws is no picnic either. The time landlords must spend on tenant screening and essential documentation doesn’t leave many spare hours to do in-depth research on Oregon rental law. That’s why having a property management company like Rent Portland Homes by Darla Andrew gives landlords such an edge. Our experts do the legwork for you, keeping on top of the latest updates to Oregon’s rent control or COVID-19 restrictions. 

Even before the rapid pace of legislation during the pandemic, Oregon has been quickly rolling out new rules for landlords over the past couple of years. Laws implementing Oregon’s statewide rent control, banning no-cause evictions, changing tenant screening, and more have continued to change the face of Portland’s rental market. With so many changes happening at a tremendous pace, it’s crucial to have a well-informed advocate on your side. 

Rent Portland Homes by Darla Andrew covers every aspect of your rental management. We make sure your rental’s paperwork is always up to date, which is especially important for government COVID-19 aid requiring extensive documentation. In keeping with our dedication to finding the best tenants, we always keep our rental units in the best shape. Our 48-hour maintenance guarantee is a big part of why our tenants choose to keep renting from us year after year. We handle all renter communication with a friendly and attentive focus. That way you can rest assured your rental and its tenants are in good hands. To hear more about how Darla can work with you, give her a call at (503) 515-3170 or fill out the contact form on our website.