HOW BAD IS PORTLAND'S HOUSING CRISIS?
Much of the United States has a housing crisis, with no major city having a minimum wage able to cover the cost of a 2 bedroom apartment. For Portland, the situation is just as grave, and getting worse. Portland ranks #2 in the U.S. for rent increases (link). Prices increased more than 40% in the last 5 years (link). This means that it’s incredibly challenging to rent here if you make under $75,000/yr (as do our teachers, lobstermen, artists, and service industry workers).
WHAT'S THE DIFFERENCE BETWEEN RENT STABILIZATION AND RENT CONTROL?
Rent control fixes rental prices; rent stabilization fixes the rate of rent increases.
This ordinance is not rent control, prices will not be fixed. It also does not apply to small landlords (folks with five or fewer units).
It allows prices to increase at a gradual pace (with the rate of inflation) so renters can continue to afford housing, and landlords can continue to receive returns on their investments.
Landlords may bank increases across years, if they do not choose to apply them in a given year. Landlords can increase the rent at a managed rate for vacated units using banked increases. Once a tenant moves in, their rent may increase by a specific percent per year.
This keeps the market flexible, while providing renters protection and security.
WHY IS RENT STABILIZATION A GOOD SOLUTION FOR PORTLAND?
In addition to making housing more stable and affordable for renters, rent stabilization will have a variety of positive ripple effects on our city:
- Renters will have more money to spend at local businesses and on healthcare and savings
- Businesses will have less employee turnover since workers won’t have to move to suburbs
- The elderly will reduce healthcare costs by staying in their homes
- Children won’t have to switch school-districts and neighborhoods will stay intact
- Taxpayers will save $10,000+/person per year in social services by preventing homelessness
This solution will balance the housing market so the city can re-focus on longer-term solutions for sustainable growth, such as updating zoning codes to develop more middle-income housing, and improving transportation routes across the city to encourage development off the peninsula.
WHO BENEFITS FROM THIS ORDINANCE? WILL ANYONE LOSE OUT?
The most direct benefits go to 60% of our citizens -- our renters, who:
- Won’t have to move due to rent increases, so our neighborhoods stay intact, children stay in their schools, and elderly folks can age in place
- Will have more of their hard-earned money to spend on savings, healthcare, education, and other crucial expenses
- Once secure in their housing with reasonable protections, can focus their time and money on families and community
The city as a whole will benefit because:
- Landlords will continue to make healthy profits.
- This relieves financial burdens that our city currently shoulders by reducing displacement and homelessness.
- Businesses will grow by keeping long-term employees who live nearby and attracting new workers with reasonable costs of living.
- Neighbors with health challenges will use fewer social services when in stable housing.
- Renters will have more money to spend at local businesses.
This will guide sustainable growth by keeping our community intact and mitigating a market collapse; so the city can focus on longer term housing solutions like zoning updates and transportation infrastructure.
WHERE HAS THIS SUCCEEDED ELSEWHERE? WHAT WERE THE EFFECTS?
Many cities are successfully using rent stabilization because it’s a solution that works for everyone.
Washington D.C. and Los Angeles, among others, continue to thrive because their mixed communities and consumer bases are supported by rent stabilization.
In 2016, many more communities passed similar ordinances: Mountain View, Richmond, and Santa Rosa, California.
Our referendum is modeled on two ordinances that are more than 30 years old, both of small cities: West Hollywood, CA and Takoma Park, MD. In both cases, the cities relieved their immediate housing crisis while supporting long-term development and growth.
These cities continue to thrive since the middle and lower-classes can work and live in the same place, while landlords can maintain their investments.
We can keep Portland’s vitality and also receive these benefits by passing this ordinance.