In Portland, homeowners will pay to move for tenants unable to pay rent
Portland landlords now have to pay relocation costs for tenants who cannot afford to pay for their home after rent increases. Should landlords all over the country worry? Tells Fool.
Many tenants are barely making ends meet during the coronavirus crisis. Rent increases during this time could lead to serious financial distress, given that millions of Americans are out of work or their income has dropped.
To protect tenants from rent increases in these troubled times, the Portland, Oregon government has ordered homeowners to pay their tenants' moving costs if those tenants are unable to pay after the rent increases and the landlord increases the rent. This rule will apply to rent increases introduced prior to March 31, 2021, and could cost homeowners $ 2- $ 900 for each move. The rule may be extended depending on the circumstances.
A blow to homeowners
Landlords in Portland will need to give tenants at least 90 days' notice if they plan to increase their rent. In response, tenants can send a written notice that they need help and landlords will have to pay their moving costs.
Of course, the goal here isn't to hurt landlords, but to help tenants avoid becoming homeless in the absence of a statewide eviction moratorium. But it is clear that the new rule will be a big blow to homeowners - especially family landlords who lack the resources that larger management companies have.
Should homeowners across the country worry
If landlords can be forced to cover the costs of relocating tenants in Portland, then technically the same can happen anywhere. But this rule only applies to rent-raising landlords and does not apply to others.
Thus, even if similar regulations are passed in other cities, homeowners can avoid the burden of paying tenant relocation by simply maintaining stable rental prices while the country continues to grapple with a protracted recession.
Of course, some landlords may try to raise their rent to offset the loss of income over the past seven months. Many had no choice but to withhold rent during the coronavirus pandemic. But many small homeowners have been driven to despair by the crisis, and for them rent increases may be an act of last resort.
The Portland Ordinance is just one example that rental laws tend to be more protective of tenants. But many homeowners have also begged for help since the first round of eviction bans were introduced at the start of the pandemic.
While some homeowners only care about their bottom line, in reality many are struggling to survive as much as their tenants. Portland's new law is another hurdle for homeowners. However, many fear that if there are more such laws, small homeowners will simply lose their livelihoods - and tenants will have to deal exclusively with larger real estate management firms, which may not be as convenient and accommodating.
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