The 2023 legislative session was a stormy one, but now that it’s over and the dust has settled a bit, there are two significant changes to Oregon landlord tenant law, in addition to the major restructuring accomplished by HB 2001. The two additional changes in the 2023 session involve an updated cap on rent increases (SB 611), and changes to service methods for notices in residential tenancies (SB 1069).
SB 611, passed on the final day of the session, amends the cap on rent increases in residential tenancies to limit price hikes during high-inflation periods. Previously, Oregon law capped rent increases at 7% plus the annual consumer price index (CPI). Because the CPI in 2022-23 was so high, annual rent increases of up to 14.6% were permitted.
To prevent similar unpredictable increases in future, SB 611 amends ORS 90.323, 90.324, and 90.600 to limit rent increases to the lesser of 7% plus CPI (the current cap) or 10%. In other words, in high-inflation years, the maximum rent increase for residential tenancies is 10%. In years with lower inflation, the maximum increase would be lower. This change adds predictability for landlords and tenants, who now know what the maximum annual rent increase can be and can budget accordingly. SB 611 also limits rent increases to once in any 12-month period.
SB 611 does not change existing provisions exempting from the rent-increase cap residential landlords who rent units that have certificates of occupancy less than 15 years old, or units that are subsidized and the increase either does not increase the tenant’s portion of the rent or is required by the terms of the subsidy program.
SB 611 applies to all notices of rent increase issued on or after the bill’s effective date.
SB 1069, which does not take effect until January 1, 2024, amends ORS 90.155 and related statutes to permit residential landlords and tenants to serve notices by email, if the parties agree to do so by separate written addendum to the rental agreement. SB 1069 also allows landlords to return funds to tenants, including security deposits and rent refunds, by electronic means, if the parties have agreed to such electronic delivery in a written agreement. Significantly, however, notices terminating a tenancy, if served by email, must also be served by first class mail.