Portland lost 14% of rentals. Did rent control cause the decline?

In 2017, Portland passed rent control. In 2019, the Oregon state legislature added statewide caps on rent hikes and evictions.

Now, a study shows Portland lost 14 percent of its single-family rentals between 2015 and 2020 — twice as much as in the surrounding three-county area.

The homeowner and landlord groups that commissioned the study blame the web of policies for Portland’s loss of rentals, Inman reported. The city, however, is not convinced.

The groups said many smaller owners have opted to sell rather than navigate the patchwork of laws or risk non-compliance.

“A mom-and-pop landlord who isn’t an attorney and only has a couple of units and isn’t doing this as their primary job, they’re really in a bad spot,” Jeremy Rogers, director of policy and legal affairs at Oregon Realtors, one of the groups behind the survey, told the website.

Of course, the buyers of those units might well continue to rent them.

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The city’s rent control laws, which took effect in March 2018, require landlords to cover relocation costs for tenants if owners raise rents by more than 10 percent or file an eviction without good cause.

Owners who violate the ordinance can be fined as much as $4,500 for a three-bedroom property, according to Inman.

The statewide measure tacked on even stricter regulations. Rent increases are capped at 7 percent in most instances. And under the law, landlords face additional burdens to evict tenants who have lived in a property for more than one year.

Michael Havlik, an executive at Multifamily Northwest, another firm that backed the survey, said although the study identified “a broad trend,” it “needs to be investigated more thoroughly.”

The Portland Housing Bureau, which dictates city housing policy, afforded the findings less credit. The agency said it could not comment on the study’s claims as it didn’t account for some factors that could affect the market.

The bureau did note that rental housing has declined across a number of major U.S. cities, according to Census Bureau data.

Plus, the survey shows that the decline in housing began in 2014 and accelerated in 2017, the year before Portland approved its rent control package.

Aside from the difficulty of isolating the impact of a single factor, there is the first rule of statistics: Correlation is not causation. But housing economists do generally prefer adding supply over rent control as a means of lowering housing costs.

[Inman] — Suzannah Cavanaugh