The city of Portland passed the relocation assistance housing policy on the 2nd of February, and it is effective immediately. This policy requires landlords to pay huge relocation fees if they choose to evict tenants for no cause, or if they increase rent by more than 10% over twelve months and the tenant chooses to move out. These fees are quite large, and can range from $2,900 to $4,500 depending on the number of bedrooms in the home.
The policy is intended to help prevent involuntary displacement and reduce homelessness, especially for lower income families. In Portland, over half of renters are considered cost burdened, meaning they spend over 30% of their income on rent. The policy is intended reduce large rent increases, and keep more renters from losing their homes. The relocation fee will also help them to pay for the costs associated with finding and moving to a new home.
This policy was created and passed with the best of intentions, but it will likely have unintended consequences.
The relocation fee will likely be very effective for large apartment owners that own many units and properties. However, landlords of single family homes are not being taken into consideration. As it is, owners of these properties are not usually making very much money off them. These landlords often would have to raise their rent more than 10% just to bring their rates to market value. The policy would also make it difficult for landlords to move back into their homes if they wanted to.
The unfortunate out come is that the relocation fee will likely reduce the number of rentals in Portland by making it more difficult to be a landlord. An inadequate number of rental properties is already a problem in Portland, and this policy may just make it worse.
Two landlords in Portland have already filed a law suit the city over the new policy. The policy may be in violation of both state and federal law, as rent control is prohibited. It may also violate existing lease agreements and state contract law.
Read more about the policy here.
What do you think about the relocation fee? Let us know in the comments bellow!