The prospect of rent increases as high as 14.6% under Oregon’s rent control law shows the law is ill-equipped to solve the underlying problem, the editorial board writes. Oregon simply needs more housing and must move more urgently to provide it.
WRITTEN BY THE OREGONIAN/OREGONLIVE EDITORIAL BOARD | SEPTEMBER 19, 2022
NOTE: While we are sharing this article from the state to our north, Oregon, it applies here in California and across the United States. Rent control is NEVER THE ANSWER, it benefits very few and legislators have a very difficult time understanding this … if you really want FAIR HOUSING for all, THEN BUILD MORE HOUSING and just stop promoting rent control.
When legislators pushed through a 2019 bill establishing statewide rent control, then-House Speaker Tina Kotek hailed it as a big step forward for tenants. “This groundbreaking tenant protection bill will make a real difference for Oregon renters,” she tweeted.
And oof, what a difference it is making.
The bill, signed by Gov. Kate Brown, capped annual rent increases to 7% plus inflation across the state, with newer buildings exempted from the limit. The generous cap adopted by legislators acknowledged economists’ longstanding skepticism over the effectiveness of traditional rent control. While tightly limited rent increases can help individual tenants, economists have noted such policies discourage new housing – the single best way to moderate rent or even drive it down.
But then came 2022 with its surging inflation. And under the formula of Senate Bill 608, landlords in 2023 may raise their rent up to 14.6%, the state announced last week, understandably triggering shock among renters and their advocates. While many landlords will likely not raise rents to such a level, any significant increase will further strain those already struggling in Oregon’s tight housing market, especially with the expiration of recent pandemic related protections.
As dire as the situation is, legislators should resist calls to lower the rent cap, as Brown suggested in a recent KGW story. Instead, they should make clear that they will not alter the rate and instead will pursue other targeted solutions, such as increased rent assistance, to help any affected tenants as legislators work on the longer-term solutions. While lowering rent increases may seem like a readymade fix, it will do nothing to solve the underlying problem causing this crisis – a severe lack of housing.
Keep in mind that landlords do not have to raise the rent at all, much less to 14.6%. And many likely will not, based on historical rent increases. But setting a cap at all sends a dangerous message to landlords, builders and investors that the state can and does intervene at will. If they believe legislators might ratchet down the rate of increase in the future, they may very well seek to maximize rent now.
The long-term solution, as we all know already, is that Oregon simply needs more housing across the board. Not just subsidized units, but housing at all levels, in all communities. That means we need our state and local governments to amend land-use policies to make housing development easier; streamline notoriously cumbersome permitting processes; and lower taxes or unnecessary requirements that depress development.
An August 2022 report by a work group for Oregon Housing and Community Services and the Department of Land Conservation and Development offers some solid draft recommendations to build on. Among them: the state should take a more active role in setting housing production targets; the focus of land-use considerations should be on how to meet those specific targets; and the state should devote additional funding to subsidized housing developments. The report also hammers home the need for urgency – something that the state has lacked for too long.
But Oregonians, too, must play a part in easing the housing crisis, most critically by accepting higher-density developments in neighborhoods. A true innovation pushed by Kotek in the Legislature – ending single-family-only zoning in larger communities – has eased legal barriers, but residents continue to resist development, decrying a loss of “neighborhood character.” Oregonians must recognize that housing isn’t just about addressing homelessness. Housing is a key pillar of the functional community, effective educational system and resilient economy necessary for preserving the high quality of life that we value. Without more housing, neighborhood character will change one way or another.
Addressing these structural and cultural issues won’t help renters now. Landlords would be wise to keep increases to the bare minimum necessary. And legislators, as well as local leaders, must look at how to financially help those facing large rent increases in the short-term.
But if leaders fail to bring the urgency, attention and economically sound approaches to solving our housing problem, the present housing crisis will be our long-term reality.
-The Oregonian/OregonLive Editorial Board
Editorials reflect the collective opinion of The Oregonian/OregonLive editorial board, which operates independently of the newsroom. Members of the editorial board are Therese Bottomly, Laura Gunderson, Helen Jung and John Maher.
Members of the board meet regularly to determine our institutional stance on issues of the day. We publish editorials when we believe our unique perspective can lend clarity and influence an upcoming decision of great public interest. Editorials are opinion pieces and therefore different from news articles.
If you have questions about the opinion section, email Helen Jung, opinion editor, or call 503-294-7621.
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