The City of Portland enacted its Renter Protection ordinance in February, 2016 as a temporary emergency measure to address the city’s housing crisis. When they did this, they decided to leave exempted any owner with only 1 Portland rental unit from being affected. As this all occurred, there was a lot of discussion and a lawsuit was filed against the city. Within a few months, however it lost in court.
On March 7, 2018 the Portland City Council voted unanimously to both remove that single owner exemption and also make the ordinance permanent. Additionally, they have signed off on a program requiring mandatory Landlord registration, and there are many questions remaining as to what the collected data will consist of and for what purposes it will be used. Clikc here to read the Affordable Housing Preservation and Portland Renter Protections Ordiance.
Next on the list, per the mayor’s Residential Services Commission (which I was formally a member, but resigned due to its overwhelming bias against landlords), 3 issues remain to be “accomplished”:
- Revise and regulate landlords’ screening criteria, making it nearly impossible to deny an application under the guise of “disparate impact”. (In other words, make it very difficult to deny any applicants.)
- Revise and regulate landlords’ security deposit requirements, capping the amounts that can be charged and regulating the way they must be refunded. (In other words, the pet stain left on a carpet is only worth the 8 inch square, pro-rated amount of an already depreciated flooring material, and not the actual cost to replace the damages that were done.)
- Create and foster a “regional” relationship with neighboring communities, designed to make the ordinance consistent across city and county lines because the marginalized tenants most affected by the housing crisis are being pushed further away from the city’s core. (In other words, owning rentals in Beaverton, Gresham or Milwaukie, etc. doesn’t insure landlords will continue to be unaffected).
While there was a lot of discussion last year at the state capital during the 2017 Legislative session about the housing crisis, (HB 2004 was only narrowly defeated) it is notable that there was almost no mention of it in this year’s just-completed 2018 session. The reasons why are 3-fold:
- The same politicians that voted HB 2004 down are still in power this year.
- The tenant activists look to this next election cycle and hope it will significantly change the make-up by 2019. (Democrat Senator Rod Monroe is largely credited with holding the line against rent control measure, and he is being aggressively challenged for his seat.)
- The City of Portland has taken the lead to permanently change Landlord Tenant Law.
You may ask, “What is really going on?” That’s a good question. We know that the Portland is a “destination-city” with a worldwide reputation that will continue to attract new residents at a significant pace because of its “quality of life”. We know that Oregon is likewise a destination-state that continues to attract people nationwide to migrate here and live in the “great Northwest”.
Lost in the discussion is any real effort to help bring more housing units online faster with less regulations and fees. Little if any of the testimony from which politicians rely on is coming from developers, builders, zoning, permitting or planning commissions who could actively and aggressively make changes and adjustments that would on-board the thousands of housing units so needed in the coming years.
Unfortunately, the ears of our elected officials have been bent by an activist oriented tenants’ rights coalition, whose real aim is to adjust the balance of power between renters and owners. They want to diminish private property rights and justify their actions by claiming discrimination and predatory practices (which, by the way, are already heavily regulated by local, state and federal laws). Tenants deserve affordable and safe housing. Lowering rental standards, removing the ability to extend and terminate renal agreements bi-laterally, capping market rates and disincentivizing housing investment will not solve a housing crisis.
This is neither a liberal vs conservative nor a democrat vs republican debate. It’s not even a property owner vs renter argument. Affordable housing groups have hijacked the messaging to solve a housing crisis by casting property owners as rich and greedy and all renters as victims of injustice. The solutions they propose force property owners to pay for a social agenda the owners did not cause and do not addresses the ultimate need to provide more housing stock. (Listen to my discussion on OPB with the director of the Community Alliance of Tenants):
While their policies may provide temporary relief for a marginalized demographic of the tenant population, they are destined to make rental units even more scarce and more expensive, which in turn will only serve the current trend of thought to enact even more punitive legislation and thus continue the spiral.
And that’s what this is: A “socialist” type of rhetoric which is taking place right now in our community, hurting the very people it claims to be advocating for. If this sounds like hyperbole, visit the websites and social media blasts and observe their claims and tactics.
The solutions being adopted are bad economics for all parties. Look to any city that has rent control. San Francisco, New York City and Seattle all have the highest rents in the country. Tenants are not winning even with these claimed social victories. Questions are now even being asked whether the city of Portland is working for or against affordable housing.
You may wonder, “What happened to that lawsuit against the city of Portland (Owens v City of Portland)?” The update is that it was filed for appearance in the State Court of Appeals is on pace to be reviewed, with supporting arguments from REALTOR groups and others. The Plaintiffs now believe it has a very good chance of succeeding.
Finally, you may consider “What can I do, as a rental property provider?”
I believe there is an obligation to unite against bad social and economic policy. I recommend visiting www.MoreHousingNow.org and donating a year’s profit from your properties to help reverse the political momentum that has built up.
(I know what you’re thinking, “A year’s profit?!” But we need to consider that’s probably a lot less than it would cost to relocate the tenant…)