Phil Querin Q&A: Multiple Rent Increases Within One Year - More on Rent Increases Under Rent Control

Want access to MHCO content?

For complete access to forms, conference presentations, community updates and MHCO columns, log in to your account or register.

Phil Querin

 

Question:  I gave a 5% rent increase in June 2019.  Can I do another rent increase again in September 2019?  If I can, how much more can I give?  If I did not give any rent increases in 2019 can I still do those increases in 2020 plus what I what is allowed in 2020?  Are rent increases based on calendar year? 

 

 

Answer.  Let’s start at the commencement of the tenancy. Rent may not be increased during first year of the tenancy. After the first year, rent increases are limited to an amount no greater than 7% plus the change in CPI (“Rent Cap”) over the prior rent.[1]  

 

Let me answer your questions in my hypothetical, assuming that you have month-to-month tenancies in place. Neither ORS 90.600 nor SB 608 place a limit on the number of rent increase notices you can issue during a 12-month period; the limitation under SB 608 relates solely to the amount of the increases.[2]

 

The law does not specifically address how one calculates the 12-month period when there are multiple increases, but logically, it seems you would start from the date of commencement of the tenancy,[3] and measure 12 months hence. So if the tenancy officially began on February 1, 2018, then February 1, 2019 would be the first anniversary date, and the time at which you could have a rent increase. 

 

So, if you wanted to increase rent on February 1, 2019, you would need to have issued a written  rent increase notice no later than October 30, 2018, giving you a full 93 days prior to February 1, 2019 (assuming the notice was mailed). 

 

The amount of the rent increase levied on February 1, 2019 would control how much more you can increase rent during the February 1, 2019 – February 1, 2020 period. If you levied three increases during this period, with proper written notices, they could not, in totality, be more than the Rent Cap. 

 

So assuming the annual change in CPI was 2.00%, the maximum sum of the increases cannot be more than 9.00% (7.00% + 2.00%) over the first year’s rent. If monthly space rent during the first year was $500, rent during the second year of the tenancy could not exceed 1.09% X $500, or $545.00 – regardless of how many notices you issued in getting there.

 

The amount of the first increase would dictate the amount of increase in notices #2 and #3. The totality of the increases during the February 1, 2019 – February 1, 2020 period may not exceed $45.00.[4]

 

[1] The September-to-September average change in the CPI, for All Urban Consumers, West Region (All Items), as published by the Bureau of Labor Statistics of the United States Department of Labor in September of the prior calendar year. According to a January 19, 2019 Oregonian article: “(a)nnual increases in the Consumer Price Index, a measure of inflation, for western states has ranged from just under 1 percent to 3.6 percent over the past five years.”

[2] Note: For manufactured housing communities in the City of Portland,  Ordinance 30.01.085 provides for the payment of Relocation Assistance for tenants when the rent increase is 10% or more.

[3] This assumes the tenancy commenced when SB 608 went into effect, February 28, 2019. 

[4] Note: Although this does not generally apply to manufactured housing owned by the tenant, landlords are not subject to the Rent Cap when the first certificate of occupancy  for  the  rental was issued less than 15 years from the date of the notice of the rent increase.  Additionally, the Rent Cap does not apply where a landlord is providing reduced rent to the tenant as part of a federal, state or local program or subsidy.

© 2011-2019 Manufactured Housing Communities of Oregon (MHCO)

503-391-4496 | Contact MHCO

MHCO Information Security Policy (2018-19)

Web design and development by Cosmonaut