ZANE SPARLING Pamplin Media Group
Oregon landlords could increase their rents by as much as 9.9% in 2022, state officials say.
The Department of Administrative Services has approved the statewide maximum increase, which takes effect next calendar year, under an emergency rent control law enacted by lawmakers ago three years.
Since then, the maximum rent increase had been 10.3% in 2019, 9.9% in 2020 and 9.2% in 2021. The law does not apply to new constructions, nor to rentals built in over the past 15 years.
This may seem like a big increase to some, but the increase is actually “relatively moderate,” according to state economist Josh Lehner, given the inflationary roller coaster trends.
“I know some of you may be scratching your head given that inflation is on the rise right now,” Lehner said.
Citing data released by the Consumer Price Index this month, Lehner says inflation in sectors other than autos and hotels is around 4%, or about double the 2% target sought by the Federal Reserve.
But the rent increase formula uses a 12-month average that includes months of low inflation from the depths of the COVID-19 outbreak.
“The current inflation surge will be reflected primarily in the maximum allowable rent increase in 2023,” Lehner said. “The ultimate economic risk is that inflation turns out to be more persistent than you think, so the Federal Reserve will step in and raise interest rates to cool the economy. Not only this economic growth would slow down, but in some historical times it even caused a recession. “