Oregon just became the first state in the nation to impose limits on how high landlords can raise re

[demmiblue]

Source: CNN

(CNN)Oregon's governor signed the first statewide rent control bill in the country.

Among the bill's provisions is a measure restricting landlords from raising rent more than 7% above the Consumer Price Index in a 12-month period. An exception applies to buildings that have been occupied fewer than 15 years.

The bill, which passed 35-25 in the Oregon House earlier this week, also provides renters protections against no-cause evictions.

"This legislation will provide some immediate relief to Oregonians struggling to keep up with rising rents and a tight rental market," Gov. Kate Brown said Thursday. "But it does not work alone. It will take much more to ensure that every Oregonian, in communities large and small, has access to housing choices that allow them and their families to thrive."

Read more: https://www.cnn.com/2019/03/01/us/oregon-raising-rent-law-trnd/index.html?utm_source=twCNN&utm_medium=social&utm_content=2019-03-01T19%3A00%3A06&utm_term=image

---

Link to tweet

[at140]

1. Mumbai had rent control during my time there

And the result was tremendous shortage of rental apartments. You had to pay landlord whole bunch of money under the table for him to let you in as a renter.

[Recursion]

3. Well, I mean, also the explicit restrictive covenent in the various "colonies"

I remember there was supposed to be some interesting mixed-income development Godrej was doing up in Powai, though.

[deurbano]

2. In SF, a lot of restaurants and other businesses are forced to close when the rents are raised,

but the same people that blame the Americans with Disabilities Act for forcing business owners out of business never mention the skyrocketing rents.

[Mosby]

4. I think this only applies to residential rent

They don't dare restrict commercial lease arrangements.

Business leases are slowly putting small companies out of business. The commercial real estate sharks know exactly how much they can raise rents until the store starts losing money, and they price accordingly.

I think this law is going to get shot down, the state has absolutely no right to tell property owners how much rent they can charge.

[deurbano]

7. Yeah, I know this is residential, but wanted to throw in my 2 cents about something that bugs me.

Actually two things: the driving out of restaurants/other small businesses providing valuable services (with little outcry about the cause-rising commercial lease rates) compared to the blaming of people with disabilities when other businesses are supposedly driven out after making little effort in the years since the ADA (or other state laws) to try to comply. (I might be exaggerating based on a small, personal sample!)

Our fave neighborhood family restaurant (it had been around forever) had to close when the lease rate was dramatically hiked. We LOVED this place (so many happy memories), partially because it was very wheelchair accessible (enough room between tables and a nice bathroom for my daughter and any other friends/family who use wheelchairs)... plus it had dining space that could be made a bit more private for small parties, easily available street parking (in SF!), warm owners, good food at affordable prices... and it was also successful and profitable. Several years later, the place is STILL vacant, with no new tenant. (I don't get the end game...)

[Mosby]

8. I know what you mean

A small strip center near me had a facelift and then drastically raised rents ($38 sqft) It was so high a Circle K at the one end closed. It's been empty now for several years, but the commercial real estate Co will not lower the rent, they would rather it sit empty forever.

That's how it works all over Phoenix, and why west Phoenix has so many completely empty properties. There are businesses that would love to give it a go, but they can't pay 20+ dollars a square foot.

[Recursion]

5. Skyrocketing rents mean you haven't built enough buildings

It's a fundamental problem.

We tell people housing should be an investment. But that means its value has to rise faster than inflation (or it's not an investment).

We also say housing should be affordable. But that means its value has to rise slower than inflation (or it's not affordable).

We can't do both, and the people who own buildings are politically much more powerful.

[Croney]

6. I really see both sides of the rent control issue.

When we had it here in Cambridge MA, much of the housing stock was in poor condition, and well-off people paid for secret extra apartments just for convenience (a city councilor was one.)

We are landlords and we charge our long-term tenant well below the market rate. People need housing, that's a given. I don't have a solution for the conflicts of interest. I can only do my part and not gouge.

[DeminPennswoods]

14. Rented for many years

and you are doing exactly what my landlord did. He loved having a long term, stable tenant who took care of his property and priced my rent accordingly. I'm sure your tenants are as appreciative as I was.

[GatoGordo]

9. It will only cause rents to increase that much further.

If you tell a landlord in a "hot market" that they can't increase rent by 10% each year, they will increase it by 9.9% and stop offering multi-year leases. And if the tenant protests, they will be evicted at the end of the one year lease (because the lease is up), and a more willing tenant will be found. I've talked to property owners in various rent controlled areas and they are very savvy when it comes to these laws. And if they tighten the screws further, the property owners will take the rental properties off the market. Again, I heard it all before.

If you don't believe it, read the forums in the various newspapers (Portland's OregonLive.com). Landlords are taking their rentals and selling them at a premium to other developers/owners who price them FAR out of the price range of the ordinary renter. Often times splitting up lots and charging even more for as many as 4 new narrow lot houses on what used to be just one property.

Despite how well intended it may sound, it won't do what it was intended to do. So I can't get on board this purely symbolic law.

From OregonLive.com

The law caps annual rent increases to 7 percent plus inflation throughout the state, which amounts to a limit of just over 10 percent this year. Annual increases in the Consumer Price Index, a measure of inflation, for Western states has ranged from just under 1 percent to 3.6 percent over the past five years.

The rent increase restrictions exempt new construction for 15 years, and landlords may raise rent without any cap if renters leave of their own accord. Subsidized rent also is exempt.

The bill also requires most landlords to cite a cause, such as failure to pay rent or other lease violation, when evicting renters after the first year of tenancy.

Some “landlord-based” for-cause evictions are allowed, including the landlord moving in or a major renovation. In those cases, landlords are required to provide 90 days’ notice and pay one month’s rent to the tenant, though landlords with four or fewer units would be exempt from the payment.

Cause: End of the lease, non-renewal.

[mathematic]

10. Inflation + 7% is hardly rent control

Inflation + 7% means rent doubles every 8 years! The number of units that can sustain rent increases of more than rate that for even 2-3 years is vanishingly small.

The "rent control" part of the bill is virtually pointless. A big single year rise will now be done over two years but, long term, there is no real limit to rents other than market forces.

I think the real reason that people are making a big deal about this is because they are for/against real rent control. Like something that limits increases to inflation + 2% or similar.

[Igel]

12. It'll produce what I've seen elsewhere.

You charge the maximum possible increase each year.

Then you reduce it through rebates, "continuing renter loyalty", or some other gimmick to what you *would* have charged.

It hurts the first few years. But once you're ahead of the price curve, then you wind up saying that the 800 sq ft apt. that runs for $2000/month is actually a steal at the rebate price of $1200/month.

This hurts most in areas undergoing gentrification or that are trendy.

[at140]

13. We are lucky here in NE Florida...

They are building so many new apartment complexes, the landlords are begging for tenants.
There are huge bill boards advertising available apartments...LEASING NOW!

[msongs]

11. when tenants totally trash a property will oregon pay for the damage? nt

[YOHABLO]

15. $1200 a month is still beyond the reach for many. Yeah, pat yourselves on the back.

But this country is full of people who are homeless. It's a national disgrace.