Key Takeaways
- Regulations Add Structure, Not Barriers – While Portland’s rental laws have increased administrative requirements for landlords, they do not prevent renting at market rates or earning solid returns.
- Investment Success Depends on Fundamentals – The profitability of a property in Portland depends more on factors like cash flow, location, and financing than on local regulations.
- Property Management Matters – Understanding the laws—or hiring an experienced property manager—can minimize compliance stress and protect your investment.
- Stay Objective and Strategic – Don’t let emotions about Portland’s landlord-tenant rules drive your decision. Treat rental properties as a business and evaluate them with clear financial criteria.
In our role as a property manager, we are often asked about the state of the rental market in Portland. Specifically, people ask whether it is a good idea to invest in Portland or seek rental property outside of the city limits.
The question is driven by the fact that over the last several years, the city has enacted a number of ordinances that have shifted the balance of landlord-tenant law. Prior to these changes, it is fair to say that Oregon landlord-tenant law was more favorable to the owner/landlord.
The laws that are often referred to during discussions regarding the regulatory changes in Portland are:
- Rent Control
- The Elimination of No Cause Terminations,
- Terminating Tenancies
- Relocation Fees
These changes in the Portland rental code received a lot of attention in the news, in forums, in any venue where the topic was “…investing in rental properties in Portland – good or bad.”
These changes in the laws created a great deal of emotional response. The common refrain heard in the investment community is that Portland is not landlord-friendly.
While this article by Portland Homes & Commercial Properties is not focusing on the details of the new era of landlord-tenant laws, we’ll focus on what these changes mean for landlords.
What New Laws Mean for Portland Landlords
From our vantage point as a property manager – these changes in law perhaps create more administrative overhead for the landlord. Certain processes have changed. And yes, there can be costs associated with terminating a tenancy. But this is all part of running a business.
The Portland regulatory environment:
- Does not inhibit the rental of properties at market rates
- Does not keep us from finding qualified tenants
- Allows us to terminate tenancies according to the terms of the lease and prevailing law
- Does not prohibit reasonable rent increases
In short, the current regulatory environment does not in and of itself dictate whether Portland is a good or bad market for investing in rental properties.
When making the decision to purchase a particular rental property, you should be running the numbers. Does “this” property meet your (financial) criteria? Does it move you in the direction you want to take your portfolio? Does it generate cash flow?
Yes, Portland landlord-tenant laws have created an administrative burden in some cases, but that is part of property management – whether you are self-managing or hiring a property manager to do it for you.
Property management requires one to pay attention to the laws and act accordingly. But, these laws don’t change the pro forma of a property.
Portland presents many opportunities for investing in rental properties. Whether the investment is good or not will be more about the fundamentals of the deal, the economy, and interest rates.
Bottom Line
A rental property is not a static investment. Make your decision on whether to invest, taking into account ALL variables.
Don’t let emotions about how the city regulates landlord-tenant laws be the deciding factor. The regulatory environment is a variable that contributes to the overall calculus of your business decision; it does not define it.
Portland Homes and Commercial Properties brings over 40 years of management experience. If you need help managing a property you already own, or are in the process of acquiring a property – we’re here to help.
Whether that would be pointing you in the right direction and sending you on your way, or taking over management of your rental business, get in touch today to learn more!