The Latest on Inflation and Rent Increases

Brand Story- How the Federal Reserve’s efforts to lower inflation is working to help Oregon renters

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In April, the U.S. consumer price index (CPI) rose 4.9%, down from 5% in March.This data was widely reported as the first time that CPI inflation was under 5% since June 2021. As demonstrated by this reduction, it appears that the Federal Reserve’s efforts to fight inflation may be working. This is welcome news for consumers who have seen significant price increases across various economic sectors.

For Oregon renters, inflation has a direct impact on how much a landlord can increase rent. As a result, high inflation in 2022 led to record-breaking rent increases in 2023. Why is this? In 2019, the Oregon legislature passed SB 608, a statewide rental control law that capped rent increases for residences that were built in the last 15 years. SB 608 capped these increases at 7% plus the Consumer Price Index for All Urban Consumers, West Region, as most recently published by the Bureau of Labor Statistics. Due to hyperinflation, that increase was capped at 14.6% in 2023, a remarkable increase over the 9.9% cap in 2022.

In response to this drastic increase, Oregon legislators have put forth legislation to reduce the total cap. Senate Bill 611 (2023) would cap the allowable annual rent increase at 10%, or 5% plus the previous year’s consumer price index, whichever is less. As reported by the Willamette Week, “the bill as initially drafted sought to cap the allowable rent hike at 8%, or 3% plus CPI, whichever was less.” However, after the bill’s main sponsors received pushback for this proposal, the cap was raised. On May 8, the bill passed out of the Senate Rules committee with a “do pass” recommendation.

In other legislative news, Governor Tina Kotek signed House Bill 2001 (2023) into law on March 29. This legislation altered the notice and eviction process for nonpayment of rent to provide greater protections for tenants struggling to make ends meet. Prior to the bill’s passage, landlords could provide 72-hour termination notices when a tenant was behind on rent. Under HB 2001, 72-hour notices are no longer allowed for nonpayment, except if the tenancy is on a week-to-week basis. Instead, renters must be given at least 10 days’ notice before a landlord can evict them for not paying their rent. If a renter pays the full late rent during the 10-day notice period, the landlord cannot file an eviction for unpaid rent. HB 2001 also allows renters to pay overdue rent after eviction proceedings have commenced in order to dismiss the case.

With a few weeks left in the legislative session, Tonkon Torp will keep close tabs on pertinent legislative developments and continue to provide updates. If you have questions about these issues or any other matters, please reach out—we’re always happy to advise.

Brand stories are paid content articles that allow Oregon Business advertisers to share news about their organizations and engage with readers on business and public policy issues.  The stories are produced in house by the Oregon Business marketing department. For more information, contact associate publisher Courtney Kutzman.