In some ways, it’s never been a better time in the US to be a landlord. Property values continue to climb, rents are at an all-time high, and renting out a property can be a great way to earn income. But understanding Oregon’s rental and landlord laws is crucial to keeping your business sound and avoiding personal or legal trouble. Oregon’s rental laws are designed to protect tenant’s rights, maintain the quality of housing in the rental market, and ensure fair practices among landlords. Whether you’re an experienced landlord or just looking into becoming one, this guide can help you understand the complexities of Oregon’s rental market.
A Landlord’s Responsibilities
Before we delve into the legal and regulatory requirements of becoming one, let’s talk about your primary responsibilities as a landlord:
- You are responsible for providing a safe and habitable rental unit, ensuring that the property meets state and local housing codes. This means basic but essential services such as electricity, heating, and plumbing. You must also make sure the property is free of health and safety hazards.
- You must also comply with all local and state laws and regulations when it comes to housing, such as tenant’s rights (more on that below), property maintenance, and rent control.
- Finally, you are responsible for keeping the property well-maintained and repaired. This both keeps the property in good condition and helps avoid turnover by retaining tenants.
Licensing Requirements for Landlords
In Oregon, certain cities carry specific licensing requirements for landlords. This is particularly true if the landlord operates multiple properties. For example, in Portland, landlords who operate more than one rental unit must register and obtain a license. This requirement is designed to help ensure rental properties meet city standards.
Legalities of Renting
One of the most crucial steps in the rental process is drawing up the lease agreement. This is the document that will outline the responsibilities and obligations of both yourself and the tenant.
Make sure your lease is as detailed as possible and is legally compliant. The agreement should explicitly include terms of rent, security deposits, and any maintenance responsibilities. It should also detail rules on things like renters insurance, smoking, and pets. Finally, consider whether you want to require renters insurance from your prospective tenants.
Requiring renters insurance is popular among landlords because it helps protect the tenant’s belongings against theft or disaster, as well as providing liability coverage — and renters insurance in Oregon is very affordable.
Consider hiring a property lawyer to help you with the finer points of crafting a lease agreement, to reduce the risk of loopholes or misunderstandings.
Rent Control Laws in Oregon
Before settling on a figure for increasing monthly rent, keep in mind that Oregon has statewide rent control laws that limit how much you can increase those rates annually. These laws are intended to prevent excessive rate hikes and protect the rights of tenants. Currently, the state of Oregon caps rent increases at 7% plus the consumer price index per year.
Tenant’s Rights in Oregon
Speaking of tenant’s rights, you should also be aware of the laws and regulations Oregon has in place to protect them. Just as with having a clear and detailed lease agreement, it’s critical to understand these rights to avoid legal entanglements.
- Privacy: a landlord must provide 24-hour notice before entering a rental unit, unless there is an immediate emergency.
- Tenants have the right to request necessary repairs to the unit, and landlords must address these requests promptly.
- Landlords must also provide notice before terminating a lease. How much notice depends on the type of lease and the reason for termination (another reason to have a property lawyer on hand).
- Oregon also has strict legal procedures regarding evictions, and tenants cannot be evicted without cause. Landlords are required to provide notice and may need to obtain a court order, depending on circumstances.
Security Deposits, Rent Collection, and Overdue Rent
Finally, here are some other considerations to help keep your landlord-tenant relationships running smoothly:
- Overdue rent. Have a clear policy about when rent is considered late and what penalties are associated with late payments. Some landlords opt for using property management agencies to handle things like delinquent payments. \
- Set up a consistent and convenient way for your tenants to pay rent — ideally through direct deposit or online payment systems instead of (or in addition to) having tenants drop off a check.
When it comes to security deposits, handling them properly is vital to preventing miscommunications and difficulties. Oregon law regulates the handling of security deposits to protect tenants and landlords alike. Landlords must provide an itemized list of any deductions from a security deposit and return any remaining deposit to the tenant within 31 days of them vacating the property.
