Oregon Rent Control Laws in 2024

In 2019, Oregon became the first state in the nation to pass statewide rent control legislation with the passage of Senate Bill 608. The law places an annual cap on rent increases and provides eviction protections for tenants after their first year of occupancy. 

Prior to SB 608, rent control was banned statewide in Oregon. However, the rapid rise in housing costs in cities like Portland led to a push for regulation on rental rates. SB 608 was signed into law by Governor Kate Brown and applied rent control measures to most rental properties 15 years or older across the state.

The law limits annual rent increases to 7% plus inflation, requires 90-180 day notice periods for increases, and bans no-cause evictions after a tenant's first year of occupancy. The statewide rent caps and eviction rules signify a major shift in Oregon's rental housing policies. However, the law still faces opposition and legal challenges from some landlord advocacy groups.

Rent Increase Caps

Oregon's statewide rent control law puts a cap on how much landlords can increase rents each year. The maximum allowable annual rent increase is 7% plus the consumer price index (CPI) inflation rate for the West Region. 

For example, if inflation was 2% one year, landlords would be able to increase rents by a maximum of 9% (7% + 2%) during that year. The rent caps apply broadly to most rental housing in Oregon that is over 15 years old.  

There are some exceptions to the 7% plus CPI rent increase cap in Oregon:

• New construction: Rental properties built within the last 15 years are exempt from rent control. This incentivizes building more housing units.
• Major renovations: Landlords can raise rents above the cap if major improvements or upgrades were made, like remodeling the kitchen or installing new appliances. This encourages fixing up older properties.
• Rent control cities: Some cities like Portland have additional local rent control ordinances that may further limit rent increases. These local laws take precedence over the statewide cap.

Outside of those exemptions, Oregon landlords are restricted from raising rents more than 7% plus the rate of inflation each year. Going above the maximum allowable increase can lead to penalties.

Rent Increase Notice Requirements

Oregon's statewide rent control law includes strict notice requirements for landlords increasing rents. Landlords must provide tenants with written notice 90 days in advance for rent increases up to 10%. For increases above 10%, landlords must give 180 days written notice. 

The written notice provided to tenants must clearly state the amount of the rent increase, the effective date of the increase, and contact information for the landlord or property manager. Tenants have the right to receive this formal notice even if the lease contains language about automatic rent increases or yearly increases pegged to the consumer price index.

If a landlord fails to provide proper written notice of a rent increase in the timeframe required, tenants have the right to refuse paying the increase until proper notice is given. Landlords who violate the rent increase notice requirements may face fines of up to 3 months rent plus actual damages. The law allows tenants to sue landlords for up to 3 times the illegal rent amount charged if proper notice is not given.

Statewide Rent Control 

Oregon's statewide rent control law applies to the vast majority of rental housing that is 15 years old or older. The law caps annual rent increases for applicable properties at 7% plus the consumer price index inflation rate.

The rent control provisions exempt new construction built within the last 15 years, as well as homes, condos, or apartments that have undergone major renovations in the last 15 years. Landlords who have invested significant capital into major upgrades and improvements are not subject to the rent caps.

Additionally, rental properties owned by individuals who only own two single family homes or condos are exempt. This exemption is designed to avoid impacting mom-and-pop landlords with just a rental property or two.

The statewide rent control law has some exceptions, but broadly applies to most multifamily rental housing and larger apartment complexes that are 15 years or older and have not had recent major renovations. This covers the majority of Oregon's rental stock across cities and counties.

Consequences for Violating Rent Control Laws

Oregon's statewide rent control law includes penalties for landlords who violate the provisions on allowable rent increases and eviction protections. Landlords found to be illegally increasing rents or evicting tenants without proper cause face fines of up to 3 months' rent plus 2 times the tenant's actual damages.

Tenants have legal recourse if their landlord violates the rent control law. A tenant can take the landlord to court and sue to recover 3 times the amount of the illegal rent charged or up to 3 months' rent for an improper eviction. The court may also award damages, attorney's fees, and costs to the tenant if the judge rules in the tenant's favor. 

To take action against a non-compliant landlord, a tenant should carefully document their communications and keep records of all rent notices and lease agreements. Photographic evidence of the unit's condition is also recommended in case of disputes over needed repairs or maintenance issues. With this documentation, a tenant has proof to demonstrate any violations of Oregon's rent control protections in court.

City of Portland Rent Increase Rules

Oregon's statewide rent control law sets limits on how much landlords can increase rents each year. However, the city of Portland has additional local ordinances that impose even stricter rent increase caps for properties located within city limits. 

Under Portland's rules, rent increases are typically limited to 5% plus the rate of inflation per year. Landlords must provide tenants with a 90-day written notice for increases up to 10%, and a 180-day notice for any increase above 10%.  

Additionally, landlords in Portland must provide a legitimate business justification for rent hikes over 5% per year. Reasons like capital improvements, operating cost increases, or similar market rents may qualify, but the landlord has the burden of proof. Tenants can challenge unreasonable rent increases.

Portland's tighter rent control regulations demonstrate how cities can layer on additional tenant protections beyond statewide laws. With lower rent increase caps and justification requirements, tenants have more security and recourse against dramatic rent hikes. However, landlord groups argue this disproportionately impacts smaller property owners in Portland.

Subsidized Housing Rent Increases

Subsidized housing properties such as those receiving Section 8 rental assistance vouchers or Low Income Housing Tax Credits have special rules regarding rent increases. These properties provide affordable housing to lower-income tenants, so rent increases are generally limited to small fixed amounts each year.

For Section 8 properties, HUD sets the maximum allowable rent increase each year. Typically this increase is around 2-3% annually. Landlords must provide 60 days written notice to tenants and the housing authority before implementing a rent increase. 

For tax credit properties, rent increases are limited by the housing authority administering the tax credits. Maximum allowable rent increases are set yearly based on factors like the regional Consumer Price Index. Increases are generally capped between 1-3% annually for these affordable units. 

Tenants in subsidized housing should verify the specific rules with the housing authority or property manager. Rent control caps do not apply to Section 8 or tax credit units, only the limits set by the housing authority contracts. This helps preserve stable rental rates for lower-income residents relying on subsidized housing.

Eviction Protections

Oregon's statewide rent control law includes protections against no-cause evictions for tenants after their first year of occupancy. 

Specifically, the law bans no-cause evictions after a tenant has lived in a property for 12 months or more, or after the first fixed term lease (whichever is shorter). This means landlords can no longer evict tenants without citing a specific "qualifying reason" once they pass this threshold.

During a tenant's first year of occupancy or initial fixed term lease, no-cause terminations are still allowed. However, landlords must provide proper notice ranging from 30 days (for a month to month tenancy) to 60 days (for a fixed term). 

After the first year or end of initial lease, landlords must have a "qualifying reason" to terminate tenancy. These include failure to pay rent, committing criminal activity, lease violations, or landlord intends to personally occupy the unit. Proper documentation must be provided.

If a landlord improperly terminates a tenancy after the first year without a qualifying reason, tenants can recover up to 3 months rent plus 2x actual damages. Tenants can also sue for 3x the rent in some cases.

These no-cause eviction protections aim to prevent landlords from arbitrarily ending tenancies and promote greater housing stability for renters after their first year of occupancy.

Rent Control in Oregon vs California

Oregon and California take different approaches to implementing rent control laws. Oregon has enacted statewide rent control that applies to most rental properties 15 years or older across the entire state. California leaves it up to individual cities and counties to pass their own local ordinances to limit rent increases, resulting in a patchwork of different policies. 

The most significant difference is that Oregon instituted a statewide cap limiting rent increases to 7% plus inflation per year. In contrast, local policies in California cities like Los Angeles, San Francisco, and San Jose impose stricter limits between 3-5% per year. However, these tighter caps only apply within certain municipalities that have passed rent control. Many areas of California do not have any form of rent regulation at all.  

Proponents of Oregon's approach argue that statewide rent stabilization provides consistency and fairness for all tenants and landlords across the state. Critics counter that rents and housing conditions vary greatly across different markets, so a one-size-fits-all policy is problematic. They contend localized ordinances can be better tailored to each city or county's needs.

Impact on Rental Housing Market

Oregon's statewide rent control law has had a mixed impact on the state's rental housing market since going into effect in 2019. 

Arguments For Rent Control

Proponents argue rent control helps stabilize the rental market and prevents dramatic rent increases that displace tenants. It promotes housing security for renters and prevents homelessness. Advocates say rent control is necessary to curb abuses by landlords and address Oregon's ongoing housing affordability crisis.

Arguments Against Rent Control  

Opponents contend rent control discourages new housing construction by reducing incentives for developers. This could result in housing shortages over time. Landlords also say rent control makes rental properties less profitable and that increased operating costs should be passed onto tenants. Critics argue it does not address the underlying supply and demand imbalance in Oregon's major cities.

Data on Rent Trends 

According to market data, Portland metro area rents have continued to rise but at more moderate rates since implementation of rent control. One 2021 study found the Oregon law reduced the rate of rent increases by around 2.5% in regulated properties. More data is needed to fully assess statewide trends. Rent control cities in California have produced mixed results, with some seeing a slowdown in rent growth but ongoing shortages.