Oregon Landlord Alert

It’s Time to Sell!

If you own a single family (house, townhome, condo) rental property in Portland, it’s time to sell.

“No man’s life, liberty or property are safe while the Legislature is in session.”

Gideon J. Tucker, 1866.

Portland, Oregon is rapidly moving from being a tenant friendly government, to a government that is outright hostile to landlords.

Last fall, the City of Portland passed Ordinance 187380, “Amend Affordable Housing Preservation Code to add Portland Renter Protections (Ordinance; amend Code Chapter 30.01).” The ordinance made two changes to landlord/tenant law in Portland.

  • The required notice a landlord must give a tenant with less than one year of occupancy for a no cause termination of tenancy is now 60 days
  • The required notice a landlord must give a tenant with one year or more of occupancy for a no cause termination of tenancy is now 90 days
  • Landlords are required to give tenants 90 days’ notice of any rent increase that exceeds 5% in a 12 month period

For landlords that may only own one or two properties, and who are not professional property managers, this makes it more difficult to evict problem tenants. Evicting a tenant ‘for cause’ for any cause other than non payment of rent is extremely difficult and time consuming. No cause terminations provide landlords a relatively easy way to get rid of problem tenants without having to document and prove every lease violation.

The Oregon Legislature is taking things even further next legislative session.

House Bill 4001, currently in the House Committee on Rules, and due to hit the floor of the legislature for a vote during the 2017 legislative session, will make the following changes to landlord/tenant law in Oregon:

  • The required notice a landlord must give a tenant with one year or more of occupancy for a no cause termination of tenancy will be 90 days
  • A landlord must pay a tenant with one year or more of occupancy one month’s rent at the time time of delivery of the notice for the termination of the tenancy
  • A landlord may not landlord may not increase rent, or decrease services, or serve a notice to terminate tenancy if
    • The tenant has made any complaint to the landlord related to the tenancy
    • The tenant has organized or become a member of a tenants’ union
    • The tenant successfully defended an action for possession brought by the landlord within the previous six months
  • In an action by or against the tenant, evidence that the tenant did any of the previous three items within six months of the commencement of the action creates a disputable presumption that the landlord’s conduct was in retaliation for the complaint or other act by the tenant.

If you haven’t already figured out why this is terrible news for property owners, let me summarize:

If your tenant has been there longer than a year, you will have to give them 90 days notice and pay them one month’s rent to leave.

While it does not explicitly do so, this law effectively eliminates no cause evictions. No cause evictions are an important tool for landlords. No one is going to evict tenants who pay on time, treat the property well, and are good neighborhood citizens. No cause evictions are used to get rid of bad tenants. For someone who is not a trained, professional property manager, it is pretty much impossible to follow all the rules necessary for a for cause eviction for any reason other than non payment of rent. Even if the tenants trash the property, the burden is on the landlord to prove is is malicious damage, and not just wear and tear.

All a tenant will have to do to to keep from being evicted (with or without cause) for six months is complain about some aspect of their tenancy. The property owner is presumed guilty until proven innocent. The burden of proof the tenant is not acting in good faith is on the landlord.

Under the proposed law, if you sell your property, you can give tenants a 30 day notice to terminate, BUT you will have to have:

  • Accepted an offer to purchase the dwelling unit from a person who intends in good faith to occupy the dwelling unit as the person’s primary residence AND
  • Provided the notice, and written evidence of the offer to purchase the dwelling unit, to the tenant not more than 120 days after accepting the offer to purchase

In other words, if you want to remove the tenants so you can spruce the house up to show it to it’s best advantage, and receive the highest price, you’re going to give tenants who have been there longer than a year 90 days notice, and one month’s rent. This means it will take you a minimum of three to four months to list your property, and under the best realistic circumstances, at least four months (more likely five to six) to close the sale and get paid.

If you own a rental house in Portland, Oregon, I am offering two simple pieces of advice:

Serve notice on your tenants now, while you still only need to give them 30 or 60 days notice, don’t have to pay them a month’s rent to vacate, and they cannot block your no cause termination; and sell.

 

Click Here for a FREE 40+ Page Seller’s Report Specific to Your Property

Your FREE 40+ page Seller’s Report is specific to your property and includes Current Estimated Value, Market Activity, Market Health Charts and Comparisons, and Detailed Information on Comparable Listings and Recent Sales. This is not a generic marketing piece full of fluff, it is a comprehensive report, unique to your property.

UPDATE: Portland’s Mayor Elect is proposing even more ridiculous restrictions on landlords!

Portland mayoral candidate Ted Wheeler on Thursday said he wants to create new rules to better protect renters from evictions.

If elected, Wheeler wants to establish criteria dictating how and when some landlords evict tenants. He didn’t offer many specifics, but said the policy would be modeled after Seattle, which lists only 18 allowable reasons for just-cause evictions for month-to-month renters.

Wheeler also proposed creating a new bureaucracy within the Portland Housing Bureau — the Office of Landlord-Tenant Affairs.

The office would mediate disputes and inform landlords and renters of their rights, according to a press release from the Wheeler campaign. It would also offer renters a new place to submit housing violations.

The Oregonian / Oregon Live, February 11, 2016.

NOTE: Ted Wheeler is now the Mayor Elect, and will be assuming office January 1, 2017.

The cornerstone of the proposed landlord tenant law?

owners may not evict residential tenants without a court order, which can be issued by a court only after the tenant has an opportunity in a show cause hearing to contest the eviction (RCW 59.18.380). Owners of housing units shall not evict or attempt to evict any tenant, or otherwise terminate or attempt to terminate the tenancy of any tenant unless the owner can prove in court that just cause exists

Seattle City Code, 22.206.160, subsection C. Click Here for direct link to City of Seattle website, scroll down to get to ss C.

In other words, No Cause Evictions Will No Longer Exist, and You Will Have to go to Court for EVERY Eviction.

 

If you own a rental house in Portland, Oregon, I am offering two simple pieces of advice:

Serve notice on your tenants now, while you still only need to give them 30 or 60 days notice, don’t have to pay them a month’s rent to vacate, and they cannot block your no cause termination; and sell.

 

Click Here for a FREE 40+ Page Seller’s Report Specific to Your Property

Your FREE 40+ page Seller’s Report is specific to your property and includes Current Estimated Value, Market Activity, Market Health Charts and Comparisons, and Detailed Information on Comparable Listings and Recent Sales. This is not a generic marketing piece full of fluff, it is a comprehensive report, unique to your property.