On Tuesday April 4th, the Oregon State House passed House Bill 2004, which would place new limitations on evictions, require relocation fees for certain evictions, and would reinstate rent controls throughout the state. As this new legislation moves on to the Senate, it would be wise to start preparing for if it passes.
Like California’s AB 1506, HB 2004 aims to address the affordable housing crisis by allowing local municipalities to place rental controls. The bill (as its current form on April 11th) would remove a statewide prohibition on local rent stabilization ordinances for residential rental units. Municipalities that want to create rent ceilings would be required to ensure a fair rate of return for property owners and create a process through which property management companies and independent rental owners could request an exception if they do not receive a fair rate of return. If enacted, new rental communities would be exempt from rent control for at least 5 years.
According to Statesman Journal, the original bill was amended to allow property managers to use no-cause evictions during the first 6 months of an occupancy but after 6 months, property managers can only terminate month-to-month residents with cause. Some just cause evictions (for business or personal reasons) are needing to make repairs or renovations, selling the unit, or if the property owner or their family plans to move into the unit. In these cases Oregon property owners and property managers would have to give a 90-day notice and provide one month’s rent for moving expenses. Independent rental owners with four or fewer units will not be required to pay the relocation fee.
As of February 2nd, the City of Portland enacted a housing policy that requires landlords to pay their residents a relocation fee if they are evicted without cause or if the rent is raised more than 10%. While many have argued that Portland’s move-out reimbursement legislation violates current Oregon state law (because it has a similar effect as rent controls), if HB 2004 is passed by the Oregon Senate, Portland’s laws would be indisputable. With Portland’s relocation fees (and by extension, if HB 2004 is passed), Oregon property managers and owners will need to strengthen their tenant screening criteria in order to avoid potential evictions.
While Oregon’s HB 2004 moves on to the Senate, take the time to review how this potential legislation will affect your communities and your current eviction policies. Make note of potential changes like eviction procedures, potential liabilities and internal fees (like moving expenses), and review if your current tenant screening provider is giving you the quality data you need to avoid potential evictions.
Do you think this law will significantly hurt your property or help it? Do you think rental controls are an effective way to combat the affordable housing shortage? Send us your experiences in the comment section below and be sure to subscribe for more legislative updates.
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