Out of Control

Why Rent Control Could Help Portland

Comments

1
As someone who rented his home out for a little over a year while I lived on the East Coast the idea that I couldn't ask someone to move after giving them 60 days notice would have forced me to just not rent my home. People should be able to maintain the ability to re take possession of their property after giving people a reasonable period of time to vacate, and the 60 days Oregon already gives any tenant who has lived in a place for a year seems more than adequate.
2
Rights are supposed to be universal, yet the word 'rights' is typically thrown around by special interests as a demand to get something through force. Property rights are universal. You do not reserve the right to dictate what a property owner should or should not do with their property, as long as what they do with it does not infringe on the property of others. You certainly do not get to appeal to the blunt-force arm of the state to get what you want and still consider yourself an ethical person. Renters have contracts, voluntarily entered with a respective property owner, not rights.
3
The solution isn't rent control. The solution is to build more apartments.
4
"It's really not even a question for economists at all," she says. "It's a question of what we want our social and political values to be."

http://sadtrombone.com/?autoplay=true
5
"Renters have contracts, voluntarily entered with a respective property owner, not rights."

Pretending that just because everything is a contract entered into by two notionally-equally-empowered parties that everything is fair is the last refuge of a scoundrel of whom can be said that every nuance of the problem has pretty much flown by them, blithely unnoticed.
6
Until the United States effects solutions to give citizens housing rights, there will be housing crises and homelessness. Property owners have rights which places them about the needs of communities. Profit is always considered above people, which is how we in Portland got into this mess in the first place. Housing ought to be a right, it ought to be a guarantee. There were supposed to be rules and agreements in place so that affordable housing would be built by these developers and property owners and yet so many of those projects violated that and no housing was built. People NEED safe and stable housing. It's incredible to me that people think otherwise.
7
I could go on and on here, but supply and demand is an issue. Building more is not a solution!! New product is expensive!! I think some caps on rent raises wouldn't be the worst thing, 10% a year. 30% a year is what we are seeing in some niche neighborhoods and that is really exorbitant.
8
Why do people always go to the most extreme and unreasonable examples of San Francisco and New York when talking about rent control? Lots of places have rent control, and it works to create stable housing, and therefore work forces, during boom and bust. 1 percent is too little, but five percent should be reasonable.
9
Caps on rent raises, say at the cost of living increase, would be a good start. In Ontario, rent increases are capped at 2.5%, or even lower depending on the municipality. Check out what Germany does: Rental price increases are required to follow a "rental mirror" (Mietspiegel), which is a database of local reference rents. This collects all rents for the past four years, and landlords may only increase prices on their property in line with rents in the same locality.

There are solutions, people - we just have to be brave enough to face down greedy developers.
10
"It's really not even a question for economists at all... It's a question of what we want our social and political values to be."

What social and political values are supported by making residency in Portland conditional on winning the lottery?
11
Much more sensible stance than the "Grow Up, Portland" dreck at that other paper, which will remain nameless...
12
@Spindles - What's "ethical" about claiming ownership of land that you did not make (humans did not create the earth, it was here long before we arrived), in order to put up a building that you did not build (workers used their labor to build the structure, the furniture, maintain the premises, etc)? Libertarianism might be sexy, but it's deeply, deeply unethical, because it is based on exploitation of material resources and human labor. In order for a property owner's contract to be honored, he/she/they must use the "blunt-arm of the state", as you refer to it, right? To imply that there is an "ethical" choice under capitalism is naive, simplistic and wrong.

If you want to talk about the blunt arm of the state being unethical, then you have to go waaaaay back to the core foundations of capitalism - an economic system that requires brutality, exploitation and greed. We need rent control now.
13
"Brutality, exploitation and greed" are a great way to sum up the way just about every single socialist system that has ever existed has operated. Talking real world here, not dreamy textbooks or manifestos.

Big picture and long-term, this is an economy, education and jobs issue. We need to work to grow all 3 in Portland, which means attracting more higher paying jobs to the region and better funding education... with a more reasonable affordable housing approach mixed in.. It is too late for rent control to have a big effect in Portland. Rents would be raised meaningfully ahead of any bill passing (which would take years), and then we would just lock in these high rates with a guaranteed 3% or so increase forever and all be happy?

What needs to happen locally and immediately if rents really are at unbearable levels is this huge class of OG badasses who have created the Portland that we all love (being a little sarcastic there, but not entirely) need to put their foot down and stop agreeing to pay these rents that they are saying are highway robbery. Stand up to the landlords, and realize that the super close-in area of Portland isn't the only option. Hell, with all of the Californians, ice cream chompers, good looking 20 somethings in skinny short shorts, etc. who are "ruining" everything, isn't it more attractive to migrate a little further East or North and set out on your own? I would love to see some newer, more down to earth pockets / clusters of bars, entertainment, shops restaurants, venues, etc. come to life over the next 5 - 10 years, and some of this is already happening. Afterall, this is exactly what people did over the last 15-20 years by moving to the used to be unattractive and cheaper close-in areas that have now blown up. Rents aren't going down significantly anytime soon in close-in Portland, if ever (even if we get rent control). Time to realize this and start working toward Plan B.
14
Once again, AirBnB, Vacasa and HomeAway are part of the problem. They need to be sued out of existence or indicted for conspiring to be the "silk road" of rentals.

If we can :build our way"out of this crisis- why do things get worse as more and more crapartments go up?

A good organized rent strike may be the way to go...
15
Time to move to Detroit!
16
Vaya con dios, pollo.
17
perhaps playing devils advocate, maybe what you need is a realtor, not a landlord. check out redfin east portland listings sometime. you can find viable ranch houses a whopping 1 mile from green line max for under 200k. you can have your own art space, rock space, back yard, and still ride bikes and transit. dude, 3 marginally productive hipsters making 26k a piece could pool their resources and buy their own home. its not that far fetched. what do you think all those rich hippies in SF did back in the late 70s or in war torn manhattan of the early 80s?? got together with friends and bought real estate. stop focusing on inner se and north portland and look to the frontier.....
18
Tom - get out of here with that rational talk, now! ...bring on the "dislikes".

All joking aside, I have made that same argument several times. It seems that this generation (meaning those that are part of the hip "artist" class...not a very accurate term, but that is what has been thrown around in this discussions a lot and is many self-identify) wants to live exactly where they want for the price they choose. They are waaaay too "hip" for an "up and coming" area...they demand the apparent "cred" that comes with living in an area that is already here. I also find it pretty odd that they never stop complaining about big ugly condos, douchey Californians, brunch lines, etc. yet they all seem to want to live right among all of these things...that like it or not, aren't going away. Full disclosure, I am in my early 30's, so not some old curmudgeon.

As you point out, it is crazy that more aren't looking to move to areas where things are still affordable where they can make their mark on the area, ....and most likely make a killer investment - rates are at all time lows, lots of first time homebuyer low down payment loans available, and these neighborhoods further east will begin to see more appreciation in value over the next 5 -20 years as the city grows. Yes these areas aren't as close to your favorite watering hole, music venue, etc, but you can't always have it both ways (and once again, aren't all of these old favorites of everyone's lost to the evil Californians anyways?).
19
The info is pretty accurate in the article. I was paying $850 for a upper duplex near Laurelhurst/Belmont until 2010, now it rents for $1475. I bought a really nice ranch with finished basement, 2 car garage and nice backyard in E Portland for $175K. I have my own studio in the basement and my $1200 mo mortgage will never go up. I probably would have had to leave Portland all together otherwise. But i'm 10 blocks from MAX, or 10 min drive up Foster /Powell back to inner SE. I enjoy my house 10 times more than any small place i ever rented close in. I wish the issue had been addressed with rent and tenant rights a bit sooner. I chose to buy after getting a no cause and could not find another apt let alone an affordable one at that time. the writing on the wall appeared with good timing as I didn't feel stable in renting with those rules in that market. I was real lucky to get out/in on time. I hope the madness stops for the many people i know dealing with rents.
20
Wow i just looked up my old duplex that I rented and it sold last month for $585,000... or $95K above the asking price and was only on the market for 5 days
21
As a landlord will their be limits on how much my expenses related to the property go up every year? No.

A SF landlord I'm friends with describes a scenario where renters in rent protected apartments routinely get $40,000+ cash to move out. Granted these are units currently getting them $238.17 a month so that investment is paid back quickly when the rent goes up to $3,000 a month but still...

Side note: I listed my duplex in St. Johns/Portsmouth back in January for $230k and only 2 people looked at it. I got one shitty offer. It's now doing tremendously well on Air BnB. So while I might have been convinced to give a local renter a 6- or 12-month lease, I won't if rent control becomes a reality. That effectively removes 2 units from the market.
22
Something not mentioned (at least I didn't see it) that contributes to the rents and occupancy rates being so high is the use of apartments and houses for short term rentals, such as are being advertised on Airbnb, Flipkey and VRBO. Many people have taken them off the long term rental market because a $1000 per month apartment can rent for 3 or 4 times that when rented short term. 94% of Airbnb's listings in Portland are not legal, meaning the owners (hosts) do not have a Type A Accessory Short-Term Rental permit, required by the city. How do they operate with out it? The city refuses to enforce it's own laws because, despite operating illegally, they still get the 12.5% tax revenues directly from Airbnb and Flipkey. If they enforced and shut down, what would probably be 50% of the listings because they don't qualify, they'd lose that revenue. So you see the problem. The city has nothing to gain, besides their credibility and putting their money where their mouth is about affordable housing, by enforcing the laws they enacted. Pretty pathetic.
23
Tom McRoy's solution above is interesting: three hipsters making $26k each could easily buy a house in East Portland. That's great for them, but not so great for the young parents each making $24k. They just got priced out of that house that the hipsters bought from their old landlord. Fortunately they found a place on 181st. But wait, that's bad news for the retiree living on $17k Social Security who had been in the place on 181st until his landlord realized he could up the rent.

And so on.

Shelby's explanation of the ups and downs of rent control is useful. But whatever the solution on short-term measures like rent control, we need to make sure it doesn't significantly slow the production of new homes. That's the only long-term way to prevent the gradual kicking out of everybody by the rich folks. If we don't keep building fancy new houses for rich people to move into, the Californians are coming for East Portland next.
24
In terms of Air BnB, it's taking some units off the market(usually fairly nice condos closer in), though it's sort of obvious who's renting out a whole home or non-owner occupied places--or who is sort of abusing the system. Overall there's about 2100 listings total for all of Portland--in comparison a larger(for Portland) apartment building like the Hassalo in the Lloyd District has over 650 total units.

The people just renting out a room in their home aren't really impacting the overall rental market though as much, because it assumes that those rooms would be rented out as long-term rentals as it is if they weren't on Air BnB. I've got a nice spare bedroom in my place, I might consider doing Air BnB occasionally, but I wouldn't bother with a permanent roommate, nor do I really want to deal with one after 15 years of having roommates.