Category: rent-control

What Oregon’s Rent Increase Cap Actually Is (And Why It Matters)

Oregon landlords face a hard legal ceiling on rent increases. ORS 90.323(2) states that except in specific circumstances, a landlord cannot increase rent or change terms of tenancy in a way that increases rent “beyond an amount equal to the annual percentage change in the Consumer Price Index for All Urban Consumers (CPI-U)” for the preceding 12 months.

This isn’t a suggestion. It’s a binding statutory cap enforceable by tenants through civil claims, and violations carry significant penalties. The Oregon Department of Consumer and Business Services (DCBS) has confirmed that this statute applies statewide and applies to the vast majority of rental properties.

If you manage 2 to 75 units and don’t occupy one yourself, you almost certainly fall under this cap. Understanding the exact calculation method, the timing, and the documentation requirements is non-negotiable compliance work.

Understanding the CPI-U: Where the Number Comes From

The Consumer Price Index for All Urban Consumers (CPI-U) is published monthly by the U.S. Bureau of Labor Statistics. It measures price changes for a fixed basket of consumer goods and services across urban areas.

For Oregon rent increase purposes, you use the 12-month percentage change — the difference between the CPI-U for your applicable month and the same month one year prior. This is published in the “Annual average percentage change” column of the BLS monthly release.

Where to Find the Correct CPI-U Data

The official source is the BLS website: bls.gov/news.release/cpi.htm. The BLS releases the monthly CPI report around the 12th of each month (with some variation). Oregon DCBS also maintains current rent increase limits on its official website.

Do not use:

• Estimated or preliminary CPI figures — use only the final published number
• Regional CPI indices (like Portland-specific indices) — ORS 90.323 requires the national CPI-U
• Year-to-date or quarterly calculations — only the 12-month rolling percentage applies
• News articles or third-party summaries — source the data directly from BLS

As of July 2026, the most recent 12-month CPI-U data applies to your current notice calculations. You must verify the exact percentage for the month you’re using by checking BLS directly.

Historical Context: Why This Matters for 2026 Compliance

Oregon’s CPI rent cap has been in effect since 2020 (HB 2001). The cap remained unchanged in 2024 and continues as of July 2026. Unlike some states that adjust rent caps annually, Oregon’s mechanism remains fixed to the national CPI-U calculation — no special legislative updates required each year, but your calculation method must remain precise.

Step-by-Step: Calculating Your Allowable Rent Increase

Step 1: Identify Your Notice Window

ORS 90.323(2) requires 90 days’ written notice before a rent increase takes effect. Plan backwards from your intended increase date:

• If you want the increase effective October 1, 2026, notice must be delivered by July 1, 2026
• Notice delivery must comply with ORS 90.160 (certified mail, personal delivery, or posting at the dwelling)
• The 90-day period is calendar days, not business days

Step 2: Locate the Applicable CPI-U Percentage

Determine which 12-month CPI change applies to your notice date:

• Visit bls.gov/news.release/cpi.htm
• Download the monthly CPI release for the month of your notice date
• Locate the line labeled “All items in U.S. city average, annual average percent change”
• Record this percentage to one decimal place (e.g., 2.5%)

Document this data point. Keep screenshots or PDFs of the BLS release page showing the date and figure you used. If a tenant challenges your increase, you must prove you used the correct CPI-U percentage published by the federal government.

Step 3: Calculate the Dollar Amount of the Increase

Multiply the tenant’s current monthly rent by the CPI percentage (as a decimal):

Allowable Monthly Increase = Current Monthly Rent × (CPI-U % ÷ 100)

Example: Current rent is $1,500/month. The applicable 12-month CPI-U is 2.5%.

• Calculation: $1,500 × 0.025 = $37.50
• New monthly rent: $1,500 + $37.50 = $1,537.50
• This is the legal maximum you can charge

You can increase by less than the CPI cap — there is no minimum increase requirement. You simply cannot exceed the CPI percentage.

Step 4: Draft and Deliver the Notice

The notice must include:

• The current rent amount
• The new rent amount
• The effective date (minimum 90 days from notice delivery)
• A clear statement that this is a rent increase notice under ORS 90.323
• The tenant’s right to contact a local tenant rights organization (recommended for liability mitigation)

Proper notice is critical. An improperly served notice is unenforceable, and you cannot legally collect the increased rent until a valid notice period has expired.

Critical Exemptions: When the CPI Cap Does NOT Apply

Exemption 1: Owner-Occupied Properties (4 Units or Fewer)

ORS 90.323(2) exempts a dwelling if:

• The property contains 4 or fewer units, AND
• The owner (you) occupy one of the units as your primary residence

If both conditions are met, you may increase rent beyond the CPI cap (though you must still provide proper notice and comply with all other landlord-tenant requirements).

Important: You must occupy the unit yourself. Renting all units, or owning a 5-unit building and living in one unit, does not qualify. “Occupy” means you live there, not that you merely own the property.

Exemption 2: New Construction (First 5 Years)

Newly constructed dwelling units are exempt from the CPI cap for the first five years after initial occupancy. After five years, the cap applies to all subsequent increases.

Tracking requirement: You must document the date of first occupancy in writing. If you cannot produce this documentation, Oregon courts treat the property as non-exempt and apply the cap.

Exemption 3: Specific Tenant Circumstances

ORS 90.323 does not prevent increases based on substantial damage caused by a tenant or material non-compliance with lease terms (with proper notice and opportunity to cure). However, these must be documented and defended separately from routine CPI increases.

Practical note: If you’re increasing rent due to tenant damage or lease violations, do not attempt to do so under the CPI exemption. Use a separate, well-documented notice that identifies the specific breach and your damages calculation.

Notice Requirements: Delivery, Timing, and What Happens If You Get It Wrong

The 90-Day Rule

ORS 90.323(2) and ORS 90.160 work together. Notice must be provided at least 90 days before the increase becomes effective. This is non-negotiable.

Calculation example:

• You deliver notice on July 15, 2026
• 90 days from July 15 = October 13, 2026
• The earliest the increase can take effect is October 13, 2026

Courts count calendar days, not business days. Weekends and holidays are included.

Proper Delivery Methods Under ORS 90.160

Notice must be delivered using one of these methods:

Delivery Method	Compliance Requirements	Proof of Delivery
Personal Delivery	Hand-deliver to tenant or adult household member; tenant signs	Signed receipt, dated
Certified Mail	Send via USPS certified mail, return receipt requested; address tenant’s current residence	Return receipt showing date received or delivery attempt
Posted at Dwelling	Post notice at the dwelling unit in a conspicuous place (front door); send copy via first-class mail	Dated photograph of posted notice; postmark of mailed copy

Email, text message, or informal notice does not satisfy ORS 90.160. Courts have consistently rejected non-statutory delivery methods as insufficient.

What Happens If Notice Is Defective

If your notice fails to meet the statutory requirements:

• The increase is void and unenforceable — you cannot legally collect the higher rent
• If you attempt to collect the increased amount, the tenant can claim you’ve charged unlawful rent and demand refund of the difference
• Tenants can file a civil claim for the overage plus attorney fees
• In some cases, tenants can use this as a defense in eviction if they withhold the “overcharge” portion

Self-managing landlords should treat notice delivery as a formal legal requirement, not an administrative task. Use certified mail with return receipt, or personal delivery with a signed and dated receipt. Document everything.

Penalties and Enforcement: What Tenants Can Do If You Violate ORS 90.323

Civil Liability Under ORS 90.323

ORS 90.323(5) provides a private cause of action for tenants. A tenant can sue you for:

• Actual damages — the difference between what you charged and what was legally allowable, calculated from the date the illegal increase took effect through the end of tenancy
• Treble damages — three times the amount of the overcharge
• Attorney fees and court costs — the tenant’s legal expenses

Oregon courts have consistently awarded treble damages in rent cap violations. A single year of overcharging a $1,500 rent by just $50/month ($600/year) becomes a potential $1,800 liability plus attorney fees.

DCBS Enforcement

The Oregon Department of Consumer and Business Services (DCBS) Housing and Community Services Division can investigate complaints about rent increase violations. While DCBS typically does not prosecute individual cases, a complaint on your record may affect your ability to license properties or obtain future permits if you expand your portfolio.

Eviction Defense

If you attempt to evict a tenant for non-payment, and the tenant’s non-payment is based on a claim that you charged illegal rent, the tenant can raise this as an affirmative defense. Oregon courts have dismissed evictions where the landlord’s unlawful rent increase motivated the non-payment.

Documentation: What You Must Keep

Maintain a compliance file for every rent increase. This file should include:

• CPI documentation: PDF or screenshot from BLS showing the 12-month CPI-U percentage you used, dated
• Calculation worksheet: Show the math — current rent, CPI %, dollar amount, new rent
• Notice copy: The exact notice provided to the tenant, with date and delivery method noted
• Proof of delivery: Signed receipt, certified mail return receipt, or dated photo of posted notice
• Tenant acknowledgment: If the tenant signed or otherwise acknowledged receipt, keep that documentation
• Exemption justification (if applicable): If you claimed an exemption, document it — e.g., date of first occupancy for new construction, or a statement of owner-occupancy for the 4-unit exemption

This documentation becomes critical if a tenant later disputes the increase. Without a clear paper trail showing you used the correct CPI-U, calculated properly, and delivered notice correctly, you’ll struggle to defend yourself in court.

A compliance platform that tracks rental statutes can help you systematize this documentation and ensure you’re using current CPI data each time you calculate an increase.

Practical Scenarios: Common Mistakes to Avoid

Scenario 1: Using Outdated CPI Data

Mistake: You read that the CPI was 2.5% in January 2026. In June 2026, you send notice using that same 2.5% figure.

Problem: By June, the 12-month CPI may have changed. If the current 12-month CPI is 2.1%, you’ve overcharged by 0.4 percentage points. For a $1,500 rent, that’s $60/year overcharge — treble damages exposure of $180 plus attorney fees.

Compliance step: Check BLS immediately before drafting notice. Use the most recent published 12-month percentage.

Scenario 2: Rounding the CPI Upward

Mistake: The CPI-U is 2.47%. You round it up to 2.5% to make the calculation easier.

Problem: ORS 90.323 does not authorize rounding. You must use the published percentage (to one decimal place as published by BLS). Rounding creates an overcharge and exposes you to damages claims.

Compliance step: Use the CPI percentage exactly as published by BLS, to the precision published.

Scenario 3: Applying the CPI Cap to an Exempt Property

Mistake: You own a 4-unit building, occupy one unit, and increase rent on the other three units by only 2% (below the CPI cap), thinking you’ve complied.

Problem: You’re claiming exemption, but you’ve capped yourself to the CPI anyway. This isn’t illegal, but it suggests you’re unsure of your exemption status. If challenged, you’d need to prove owner-occupancy to defend the exemption.

Compliance step: If your property qualifies for exemption, document it and increase rent as market conditions warrant. If you choose not to use the exemption, you must comply with the CPI cap.

Scenario 4: Ignoring New Construction Exemption Tracking

Mistake: You construct a 5-unit building, first occupied in 2024. In 2028, you increase rent by 3% and assume the new construction exemption still applies.

Problem: The new construction exemption expires after 5 years from first occupancy. If first occupancy was in 2024, the exemption expired in 2029. Your 2028 increases may be within the exemption, but your 2029 increases are not. After 2029, only the CPI cap applies.

Compliance step: In a calendar reminder for the fifth anniversary of first occupancy, flag that the exemption ends and the CPI cap begins.

Integration with Your Rent Collection and Portfolio Operations

If you manage multiple units or properties, rent increase calculations become complex. Ensuring each property uses the correct CPI-U, delivers notice on time, and documents everything requires systematic tracking.

A rent payment platform that integrates lease data can flag when rent increases are due, calculate allowable amounts, and ensure you’re using current CPI data. Some platforms automatically pull BLS CPI updates and calculate the allowable increase percentage for you.

Lease operations tools that manage notices can ensure notice is delivered via compliant methods and documented with proof of delivery.

For portfolios with 10+ units, manual CPI tracking and notice delivery becomes error-prone. A compliance platform that centralizes rent increase calculations and mandates documentation creates accountability and reduces the risk of accidental overcharges.

Oregon’s Broader Rent Control Context (2026)

Oregon’s CPI-based rent cap is statewide law, but some local jurisdictions impose stricter limits. Portland, for example, has enacted local rent control provisions. If your properties are in Portland, Eugene, or other cities with local ordinances, you must comply with whichever cap is more restrictive.

As of July 2026, statewide ORS 90.323 remains the baseline. Always check your city or county for local overrides.

Frequently Asked Questions

Q: Can I increase rent by less than the CPI cap?

A: Yes. The CPI cap is a ceiling, not a floor. You can increase by 1% even if the CPI allows 2.5%. There is no minimum increase requirement. However, you must still provide 90 days’ notice if you increase rent at all.

Q: What if a tenant doesn’t leave at the end of 90 days? Does the increase take effect anyway?

A: Yes. As long as you provided proper notice, the 90-day period expires and the increase becomes effective on the date specified in the notice, regardless of whether the tenant moves out. If the tenant continues to occupy the unit, you can attempt to collect the increased rent. If they refuse to pay, you may pursue eviction for non-payment. However, the tenant can then defend the eviction by claiming the increase was unlawful, so ensure your calculation and notice are airtight.

Q: Who is responsible for knowing about CPI changes—me or my tenant?

A: You are. As the party imposing the increase, you must use the correct CPI-U and calculate correctly. Tenants are not required to audit your math. If you get it wrong, you’re liable for damages. Ignorance of the current CPI-U does not excuse an overcharge.

Q: If I own a 4-unit building and occupy one unit, can I increase the other three units’ rent beyond the CPI cap?

A: No. The exemption for owner-occupied 4-unit buildings exempts the owner from the cap, not the property. If you occupy one unit, you can increase the rent on all four units (including your own, if you rent it to a successor). However, ORS 90.323(2) is clear that the exemption applies to the owner-occupied unit only — the other three units remain subject to the CPI cap unless you provide a different legal justification (e.g., substantial tenant-caused damage).

Best practice: Apply the CPI cap to the non-owner-occupied units and document that you’re doing so, even though you have the legal right not to. This removes any ambiguity and reduces litigation risk.

Q: What if the CPI-U goes negative (deflation)? Do I have to decrease rent?

A: No. Oregon law allows you to hold rent flat if CPI is negative or zero. You are not required to decrease rent. However, you also cannot increase it. If CPI-U shows a -0.5% change, you must keep rent at the previous month’s level or lower — you cannot increase by that negative percentage.

Q: I sent notice in July for an October 1 increase. In August, the CPI-U changes. Do I use the July CPI or the August CPI in my calculation?

A: You use the CPI-U that was published on the date you sent the notice (July). Once notice is sent, the calculation is locked in. You do not recalculate based on updated CPI-U data published after notice is sent. This is why accuracy at the time of notice is critical.

Disclaimer

This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for guidance specific to your situation. Rent increase laws are complex and vary by jurisdiction. Oregon tenant rights organizations and the Oregon State Bar can provide referrals to licensed landlord-tenant attorneys if you need professional guidance on a specific transaction or dispute.

Overview: Oregon’s Statewide Rent Increase Cap

On January 1, 2020, Oregon enacted Senate Bill 608 (now codified as ORS 90.323), establishing the first statewide rent increase cap in the nation. This law restricts annual rent increases to a maximum of 7% plus the Consumer Price Index (CPI) for the Portland-Salem-Eugene area.

For self-managing landlords, this statute is non-negotiable. Violations expose you to:

• Tenant lawsuits for actual damages plus three additional months’ rent
• Attorney fee recovery by the tenant
• Complaints filed with Oregon BOLI resulting in investigation and potential enforcement action
• Loss of credibility in future lease disputes

Unlike many rent control regimes that apply only to specific jurisdictions or older buildings, ORS 90.323 applies statewide to all residential tenancies—from Portland to rural Eastern Oregon, from luxury apartments to single-family rentals. The only exceptions are specific property types (see below), and even then, local ordinances may impose stricter limits.

This guide walks you through the precise requirements, calculation methodology, notice procedures, and penalties you must understand to remain compliant.

What ORS 90.323 Actually Says: Statute and Scope

Applicable Properties and Tenancies

ORS 90.323 applies to all residential tenancies in Oregon, including:

• Single-family rental homes
• Condominiums and townhomes
• Apartment buildings (2-75 units and larger)
• Mobile home parks
• Room rentals within a dwelling

The statute applies regardless of whether the tenant has occupied the unit for one year or ten years, and regardless of the initial rent amount.

Properties Explicitly Exempt from ORS 90.323

The following property types are exempt from the 7% + CPI cap under ORS 90.323(1):

• Owner-occupied single-family homes or duplexes — where the landlord owns and occupies one of the units as their primary residence
• New construction — the first tenancy in a dwelling unit constructed after January 1, 2020, for the first five years of occupancy by the first tenant. After five years, the cap applies to subsequent tenancies and lease renewals
• Residential properties where the owner owns five or fewer single-family homes, condos, or mobile home lots — Oregon’s small-landlord exemption, effective through December 31, 2024 (see 2024 amendments below)

Critical compliance point: If you believe your property qualifies for an exemption, document that exemption in your files before issuing a lease or notice of increase. Exemptions must be claimed affirmatively; you cannot discover them during litigation.

2024 Amendment: Small Landlord Exemption Expiration

For years, Oregon law exempted owners of five or fewer residential units from the rent increase cap. That exemption expired on December 31, 2024. Effective January 1, 2025, the 7% + CPI cap applies to all residential properties regardless of the number of units owned—with the limited exceptions noted above.

If you own 2-75 units (LeaseBase’s typical customer base), you have been subject to ORS 90.323 since 2020, but if you own fewer than six units, your exemption has now ended. Update your internal compliance procedures immediately.

The 7% + CPI Formula: How to Calculate Your Maximum Increase

Understanding the Formula

The maximum rent increase is calculated as:

Maximum Increase = (7% + CPI Percentage) × Current Rent

For example, if the CPI for the Portland-Salem-Eugene area is 3.2%, the maximum increase would be:

10.2% × Current Rent = Maximum Increase

This is not a fixed 7% across the board. The CPI component changes every year, so your maximum allowable increase recalculates annually.

Which CPI Index Does Oregon Use?

ORS 90.323(1)(b) specifies that the CPI used is the Consumer Price Index for All Urban Consumers (CPI-U), published by the U.S. Bureau of Labor Statistics (BLS), specifically for the Portland-Salem-Eugene, OR-WA area (Series ID: CUUR49RSA0).

The law uses the average CPI for the 12 months ending in August of the prior calendar year. This means:

• For increases effective January 1, 2026: The applicable CPI was the average of August 2024 through July 2025
• For increases effective January 1, 2027: The applicable CPI will be the average of August 2025 through July 2026
• For increases effective January 1, 2028: The applicable CPI will be the average of August 2026 through July 2027

The Oregon Department of Consumer and Business Services publishes the applicable CPI percentage each year on or before December 1. You can access this official determination at oregon.gov/employes-hr under the CPI Schedule or contact your local BOLI office.

Practical Calculation Example (July 2026)

Assume:

• Current monthly rent: $1,500
• Applicable CPI for 2026 increases: 2.9%
• Maximum increase: 7% + 2.9% = 9.9%
• Dollar increase: 9.9% × $1,500 = $148.50
• New maximum rent: $1,500 + $148.50 = $1,648.50

You cannot increase the rent to $1,648.51. The calculation must not exceed the statutory formula. If your calculation results in a fraction of a cent, round down to the nearest cent to stay compliant.

Compounding Effect and Multi-Year Increases

The 7% + CPI cap applies annually. Each year’s increase is calculated on the current rent, not the original rent. This creates a compounding effect over multiple years.

Year-by-year example (assuming stable 2.9% CPI):

• Year 1 (2024): $1,500 × 9.9% = $148.50 → New rent: $1,648.50
• Year 2 (2025): $1,648.50 × 9.9% = $163.00 → New rent: $1,811.50
• Year 3 (2026): $1,811.50 × 9.9% = $179.34 → New rent: $1,990.84

Note: You are not required to increase rent annually. You can increase once every two years, every three years, or not at all. The cap only restricts the amount of increase in any given year; it does not mandate an increase.

Notice Requirements: Timing, Content, and Service

30-Day Written Notice Rule

ORS 90.323(2)(a) requires that any rent increase be preceded by at least 30 days’ written notice before the increase takes effect.

Key compliance points:

• 30 days means 30 calendar days, not business days. If you provide notice on January 1, the earliest effective date is January 31.
• Notice must be in writing. Email, text message, or verbal notice is insufficient. You must deliver written notice via one of the methods specified in ORS 90.160 (see below).
• The notice period runs from the date of service, not the date you draft the notice. If you email notice on January 1 at 11:59 p.m., the 30-day clock starts January 1, not January 2.
• The increase is void if proper notice is not given. Tenants can recover damages plus attorney fees for rent increases imposed without the required notice.

Methods of Service (ORS 90.160)

Written notice of rent increase must be served on the tenant using one of the following methods:

Service Method	Compliance Rules	Proof Required
Hand delivery to tenant	Delivered directly to tenant in person. Confirm they received it.	Written receipt from tenant or witness signature.
First-class mail, postage prepaid, to the address where rent is paid	Must be sent to the address where the tenant pays rent (typically the rental property address). Notice is deemed served three days after mailing.	Certified mail receipt (USPS tracking). Keep a copy of the letter sent.
Email with confirmation of receipt	Only if tenant has agreed in writing to receive notices via email. Confirmation of receipt is required (read receipt must be enabled).	Email with read receipt timestamp or tenant’s written acknowledgment.
Posting on the premises and certified mail	Post notice on the rental unit door and send certified mail. Use if tenant avoids receipt. Notice is deemed served five days after posting and mailing.	Certified mail receipt and dated photograph of posted notice on unit door.

Recommended practice for compliance: Use certified mail with return receipt requested. This creates a paper trail that proves service date beyond dispute. Keep the green receipt card and the certified mail receipt in your lease file for each unit.

Content of the Notice

The notice of rent increase must include the following information:

• The current rent amount
• The new rent amount
• The date the new rent becomes effective (at least 30 days after service)
• A statement that the increase complies with ORS 90.323 or, if exempt, the basis for the exemption
• Contact information for the landlord or property manager
• A notice of tenant rights under Oregon law (see “Notice of Tenant Rights” section below)

Oregon BOLI provides a model notice form. While not legally mandated, using the BOLI form significantly reduces the risk of a notice being deemed defective. You can download the current form at oregon.gov/boli/workers/pages/model-notice-of-rent-increase.aspx.

Notice of Tenant Rights (Required Addendum)

Under ORS 90.323(2)(d), every notice of rent increase must include a summary of tenant rights under Oregon law, including:

• The right to request a meeting with the landlord to discuss the increase
• Information about tenant resources (legal aid, local housing authority contact)
• The right to organize with other tenants
• Contact information for BOLI to file complaints

The Oregon Bureau of Labor and Industries publishes the required statutory notice language. If your notice does not include this language, the notice may be voidable, and you could face a complaint with BOLI.

Local Rent Control Ordinances: When Stricter Rules Apply

Cities with Rent Control Caps Lower Than 7% + CPI

Several Oregon cities have enacted local rent control ordinances that impose stricter limits than the state 7% + CPI cap. When local and state law conflict, the lower cap applies. You must comply with whichever rule is more restrictive.

City / Jurisdiction	Local Cap	Statute / Ordinance	Additional Restrictions
Portland	5% or CPI, whichever is lower	Portland City Code 30.01.085	Just cause required for non-renewal; additional notice requirements.
Eugene	5% per year (no CPI allowance)	Eugene City Code 29.260–29.285	Just cause for non-renewal; exemptions for new construction (5 years) and owner-occupied.
Salem	7% + CPI (state default)	ORS 90.323	No additional local ordinance; state law applies.
Corvallis	7% + CPI (state default)	ORS 90.323	No local ordinance; state law applies.

Compliance trigger: Before increasing rent on any unit, verify the city where the unit is located. If the unit is in Portland, the 5% or CPI (whichever is lower) cap applies, not the state 7% + CPI. Many landlords unknowingly over-increase by relying on state law in Portland.

Just Cause Requirements in Local Ordinances

Portland and Eugene not only have lower rent caps—they also restrict lease non-renewals. Landlords cannot simply refuse to renew a lease to circumvent rent control caps. A non-renewal is only valid if based on one of several “just causes” (e.g., owner occupancy, property sale, rehabilitation, repeated lease violations).

If you own units in Portland or Eugene, consult the local city code and consider whether a non-renewal based on just cause is available before attempting to terminate a tenancy to reset rent.

Calculating and Recording the 2026 CPI for Increases Effective January 1, 2027

As of July 2026, you may already be planning 2027 rent increases. Here’s the timeline for obtaining the correct CPI:

• August 2025–July 2026: The CPI-U data is being published monthly by BLS. The average of these 12 months will determine the CPI percentage for 2027 increases.
• On or before December 1, 2026: Oregon Department of Consumer and Business Services will publish the official CPI percentage for 2027 increases.
• Between December 1, 2026, and December 31, 2026: You can begin serving 30-day notice of increases effective January 1, 2027, using the official state CPI figure.

Do not estimate or use preliminary BLS data. Wait for the official state determination published by December 1. Using an incorrect CPI percentage, even if it’s close, can expose you to damages and complaints.

Penalties for Non-Compliance: Damages and Enforcement

Tenant Damages for Illegal Increases

If you impose a rent increase that violates ORS 90.323, the tenant can sue you under ORS 90.323(3). The remedy structure is severe:

• Damages equal to three months’ rent at the illegal increase amount (not just the difference between the illegal and legal increase)
• Plus actual damages (money the tenant paid above the legal maximum)
• Plus reasonable attorney fees and court costs (the tenant does not bear the cost of litigation)

Example: You increase rent by 12% (exceeding the 9.9% cap) on a tenant paying $1,500/month. The illegal amount is $180/month. Damages owed would be:

• Three months’ × $180 = $540 (statutory damages)
• Plus 12 months of actual overpayment (if suit is filed after 12 months of the illegal increase) = $2,160
• Plus tenant’s attorney fees (typically $5,000–$15,000+ depending on case complexity)
• Plus court costs
• Total exposure: $7,700+

This is not a situation where the tenant’s attorney might take a pass due to small damages. Even a $100/month overcharge creates $300 in statutory damages plus attorney fees, making it economical for legal representation.

Oregon Bureau of Labor and Industries (BOLI) Enforcement

Tenants can also file a wage and hour complaint with Oregon BOLI. BOLI investigates violations of ORS 90.323 as a labor standards issue.

BOLI complaint outcome: BOLI can investigate, determine that a violation occurred, and issue an order requiring the landlord to refund illegal increases plus penalties. Failure to comply with a BOLI order can result in:

• Wage and hour liens against the landlord’s property
• Collection action by BOLI on behalf of the tenant
• Civil penalties in addition to refunds owed

BOLI contact information: Oregon Bureau of Labor and Industries, Wage and Hour Division, (503) 731-4070 or oregon.gov/boli.

Criminal Penalties (Limited)

ORS 90.323 does not impose criminal penalties. However, repeated or willful violations could potentially trigger unfair practice claims under Oregon consumer protection law or trigger increased scrutiny from BOLI and local housing authorities, damaging your reputation as a landlord.

Procedural Compliance Checklist for Rent Increases

Use this checklist every time you increase rent:

1. Verify property exemption status. Is the property owner-occupied, newly constructed (within 5 years), or otherwise exempt? If exempt, document the exemption in the lease file.
2. Identify the property city and jurisdiction. Check if local rent control laws apply (e.g., Portland 5% cap, Eugene 5% cap). If local laws are stricter than state law, use the local cap.
3. Obtain the current official CPI percentage. Use the Oregon Department of Consumer and Business Services’ published CPI for the applicable year. Do not estimate.
4. Calculate the maximum allowable increase. Maximum = (7% + CPI%) × Current Rent. Round down to the nearest cent.
5. Decide the increase amount. You are not required to increase to the maximum. You can increase less or not at all. But you cannot exceed the maximum.
6. Draft the notice of rent increase. Include current rent, new rent, effective date, and the full Oregon BOLI notice of tenant rights addendum.
7. Select service method. Certified mail with return receipt is recommended for proof of service. Mail at least 31 days before the effective date.
8. Serve the notice. Do not serve the notice less than 30 days before the effective date.
9. Document service. Keep the certified mail receipt card, the return receipt, and a copy of the notice in your lease file.
10. Track the effective date. Update your accounting system to reflect the new rent amount starting on the effective date. Do not collect the old amount after the effective date.
11. Store records for at least 6 years. BOLI investigations often go back several years. Keep all notices of increase, payment records, and service proofs.

Special Situations and Edge Cases

Month-to-Month Tenancies

Month-to-month tenants have the same protections as fixed-term lease holders. A rent increase on a month-to-month tenant is subject to the 7% + CPI cap and requires 30 days’ written notice. The increase takes effect at the end of the 30-day notice period.

Fixed-Term Leases: Can You Increase Mid-Lease?

Generally, no. If a tenant has a fixed-term lease (e.g., a one-year lease), you cannot increase the rent during the lease term unless the lease specifically allows it. The cap applies when you seek to increase rent at renewal or the end of the lease term.

However, if the lease contains a clause allowing annual adjustments (e.g., “rent may increase by up to 7% annually”), you must still comply with the 30-day notice requirement and cannot exceed the 7% + CPI formula even if the lease language is broader.

Utilities, Maintenance Fees, and Pass-Through Charges

The 7% + CPI cap applies to base rent. However, you may separately increase utility charges, parking fees, pet deposits, or other pass-through costs—subject to the requirement that such charges must be reasonable and clearly disclosed to the tenant.

Be careful not to disguise a rent increase as a fee increase. For example, if you increase “rent” by 5% and “maintenance fee” by 10%, the combined effect may violate the cap depending on how the charges are structured. Consult your lease language and consider local tenant protections.

Lease Renewal vs. New Tenancy

The cap applies to both lease renewals (existing tenants) and new tenancies. You cannot charge a new tenant significantly more than the previous tenant paid without documenting a legitimate market rate change. Discriminatory pricing based on protected class (race, disability, familial status, etc.) violates fair housing law regardless of the rent cap.

Documentation and Record-Keeping Requirements

Maintain the following records for each unit for at least six years:

• Lease agreements — signed by both parties, showing start date and initial rent
• Notices of rent increase — original copy with date served and service method
• Proof of service — certified mail receipts, email read receipts, or signed acknowledgments
• Payment records — showing rent paid, date received, and amount for each month
• CPI documentation — the official state determination of the applicable CPI percentage used for each increase calculation
• Exemption documentation — if claiming exemption (new construction, owner-occupied, small landlord prior to 2025), maintain documentation supporting the exemption

Digital record-keeping is acceptable and recommended. A property management platform like LeaseBase Lease Operations can automatically track notice timelines, store documents, and flag compliance deadlines. If you are managing multiple units, automated documentation reduces the risk of missing a 30-day notice deadline or losing proof of service.

Frequently Asked Questions (FAQ)

Q: Can I increase rent more than once per year?

A: The statute does not prohibit multiple increases per calendar year, but each increase is subject to the 7% + CPI cap. For example, if you increase rent on January 1 by the maximum amount, you cannot increase again until the following January 1 using the updated CPI. Practically, most landlords increase once per year on the lease anniversary or January 1. Frequent increases invite tenant pushback and legal challenges.

Q: What if I provide notice but the tenant contests the increase in court?

A: If a tenant sues you after receiving notice, you must prove that your increase complies with ORS 90.323. You bear the burden of proving compliance—not the tenant. This means you must have calculated the increase correctly, documented the CPI used, and provided proper notice. Burden of proof is on you. Keep all documentation organized and accessible.

Q: If I own property in both Portland and Eugene, do I use different rent caps for each?

A: Yes. Portland has a 5% or CPI (whichever is lower) cap. Eugene has a 5% flat cap. If you own units in both cities, calculate the maximum increase for each city using its local ordinance. You cannot average them or apply the state cap uniformly.

Q: What happens if I discover I calculated an increase incorrectly after issuing notice?

A: If you notice the error before the increase takes effect, immediately notify the tenant in writing with a corrected notice. If you have already collected the overage, offer to refund the difference. Document the correction. If you wait until after the tenant sues to correct the error, a court is unlikely to find the correction sufficient to defeat the tenant’s claim for damages and attorney fees.

Q: Do I need to use the Oregon BOLI template for the notice of rent increase?

A: The template is not legally required, but it is strongly recommended. The template includes all required statutory language (notice of tenant rights, CPI explanation, contact information). If your custom notice omits required language, a tenant can argue the notice is defective and void, forcing you to start the 30-day clock over. Use the BOLI template.

Integration with Lease Operations and Compliance Systems

Managing rent increases across multiple units manually is error-prone. Using a dedicated platform to track leases, notice timelines, and compliance deadlines significantly reduces the risk of non-compliance.

LeaseBase Compliance Engine can automatically calculate allowable rent increases based on the property location, verify the applicable CPI, and flag when 30-day notice periods are approaching. Lease Operations stores all notices and service records digitally, creating an auditable trail if BOLI or a tenant initiates a complaint.

For landlords managing 2-75 units, a dedicated compliance and operations platform costs significantly less than the potential liability from a single incorrectly calculated increase and is far simpler than tracking multiple CPI rates, jurisdictions, and notice deadlines in spreadsheets.

Conclusion: The Bottom Line for Oregon Landlords

What Is HB 1217 and When Did It Take Effect?

Washington House Bill 1217, enacted in 2024 and effective January 1, 2025, introduced the state’s first statewide rent increase cap. This legislation fundamentally changed how Washington landlords structure rent increases across all 39 counties and cities with no municipal rent control ordinances.

Before HB 1217, Washington had no statewide rent increase limits. Individual cities like Seattle, Tacoma, and Olympia maintained their own local ordinances, but unincorporated areas and many cities operated without statutory rent increase caps. HB 1217 closed that gap by establishing a uniform maximum across the entire state.

The law applies to all residential tenancies in Washington, including single-family homes, duplexes (with limited exceptions), multi-unit apartments, and condominiums. The only hard exemptions are owner-occupied duplexes where the owner occupies one unit and has no other rental properties, and newly constructed units during their first five years of occupancy.

Effective date for compliance: January 1, 2025. Any rent increase notice issued on or after this date must comply with HB 1217, even if the increase takes effect later in 2025 or 2026.

The 7% Rent Cap: How It Works

RCW 59.18.140(1) establishes the rent increase limit as follows:

“A landlord shall not increase the rent for a dwelling unit or accessory dwelling unit more than seven percent or the annual percentage increase of the consumer price index for all urban consumers (CPI-U) for the 12-month period ending August 31st prior to the date of the intended increase, whichever is less, except as provided in subsections (3) and (4) of this section.”

This creates a dual-trigger limitation:

• Cap A: 7% maximum increase — You cannot raise rent more than 7% under any circumstance
• Cap B: CPI-U inflation rate (if lower) — If the 12-month CPI-U is lower than 7%, that lower figure becomes your ceiling
• The operative rule: whichever is LESS — You must use the lower of the two figures

In practical terms:

• If CPI-U is 3.2% → You can increase rent up to 3.2% (not 7%)
• If CPI-U is 5.8% → You can increase rent up to 5.8% (not 7%)
• If CPI-U is 8.1% → You can increase rent up to 7% only (the 7% cap prevents the full inflation rate)
• If CPI-U is negative (deflation) → You cannot increase rent (no increase permitted)

The key phrase is “12-month period ending August 31st prior to the date of the intended increase.” This means you must use the CPI-U figure released in mid-September (which covers the 12 months ending August 31) for any rent increase taking effect on or after October 1 of that year.

CPI-U: Which Index Do You Use?

Washington law does not specify a particular CPI source, but refers specifically to the “annual percentage increase of the consumer price index for all urban consumers (CPI-U).” This is the official index published by the U.S. Bureau of Labor Statistics (BLS).

How to find the correct CPI-U figure:

1. Visit the BLS website at bls.gov
2. Download or record the CPI-U for all urban consumers (Series ID: CPIAUCSL)
3. Identify the 12-month percent change ending August 31 of the prior year
4. Document the exact date you accessed this figure and the source

Example calculation (hypothetical for 2026):

If the 12-month CPI-U ending August 31, 2025 was 3.4%, a rent increase notice issued in September 2025 (effective October 1, 2025 or later) must not exceed 3.4%. If your current rent is $1,500/month:

• Maximum increase = $1,500 × 0.034 = $51
• New rent = $1,551/month

You must document that you used the BLS CPI-U figure of 3.4% for this calculation. Retain this documentation indefinitely, as it becomes your defense if a tenant challenges the increase.

Notice Requirements Under HB 1217

RCW 59.18.140(2) establishes strict notice requirements that differ from general Washington lease renewal notices:

“A landlord shall provide a tenant with notice of an intended increase in rent as follows: (a) For a month-to-month tenancy, the landlord must provide notice in writing at least 60 days prior to the effective date of the increase.”

The 60-day notice requirement is mandatory and has no exceptions. This overrides the general 30-day notice period used for other lease modifications in Washington.

What the notice must include:

• Current rent amount
• New rent amount (dollar amount, not percentage alone)
• Percentage of the increase
• Effective date of the increase
• The CPI-U figure used (or statement that increase is at or below the 7% statutory cap)
• A statement of the tenant’s right to dispute the increase if it exceeds legal limits

Notice format: The notice must be in writing and delivered according to RCW 59.18.060 (personal delivery, first-class mail, or email if tenant has agreed). LeaseBase’s lease operations tools can generate compliant notices with the required language pre-populated.

Timing does matter: The 60 days must be calculated from the date notice is delivered, not sent. If you email notice on September 1, and the tenant doesn’t check email until September 5, the clock still starts on September 1 (the delivery date). However, to be safe, use methods with proof of delivery (certified mail, email with read receipt).

Exemptions and Special Situations

RCW 59.18.140(3) provides limited exemptions from the rent cap:

1. Owner-Occupied Duplex (Limited Exemption)

If you own a duplex and occupy one unit yourself, and own no other rental properties in Washington, you are exempt from the 7% cap for increases on the vacant unit. However, this exemption is narrowly defined:

• The owner must personally reside in one unit
• You must own no other rental properties in Washington
• The exemption applies only to the non-owner-occupied unit
• This exemption does NOT apply if you own single-family homes elsewhere or other rental units out of state

If you meet all criteria, you may increase rent without the 7% cap, but you must still provide 60 days’ notice and the increase must not be “unconscionable” (an undefined legal standard that courts would assess case-by-case). This exemption is rarely worth relying on without legal counsel.

2. Newly Constructed Units (5-Year Exemption)

A residential unit is exempt from the rent cap for the first five years after initial occupancy. After five years, the cap applies to all subsequent increases.

• “Initial occupancy” means the first tenant moves in
• The exemption clock runs from move-in date, not construction completion
• After 60 months, the unit becomes subject to the 7%/CPI-U cap
• You must track the occupancy date for each unit to know when the exemption expires

Example: A newly built apartment building with move-in on March 15, 2025. The unit is exempt until March 15, 2030. On March 16, 2030, the 7%/CPI-U cap applies to all rent increases on that unit.

3. Properties with No Prior Increases

Some interpretations suggest that the first rent increase on a property may be treated differently, but RCW 59.18.140 does not explicitly exempt first increases. To avoid liability, apply the 7%/CPI-U cap to all increases, including the first one.

Calculating Your Maximum Increase: Step-by-Step Compliance Checklist

Step 1: Determine the applicable CPI-U figure

• [ ] Identify the rent increase effective date
• [ ] Locate the 12-month CPI-U ending August 31 of the prior year
• [ ] Record the URL and date you accessed the BLS data
• [ ] Document the exact CPI-U percentage to two decimal places

Step 2: Compare 7% to CPI-U and select the lower figure

• [ ] Write down 7%
• [ ] Write down the CPI-U percentage
• [ ] Circle the lower number — this is your maximum allowable increase

Step 3: Calculate the dollar increase

• [ ] Current monthly rent: $__________
• [ ] Allowable percentage increase: __________% (from Step 2)
• [ ] Dollar increase: Current rent × percentage = $__________
• [ ] New monthly rent: $__________

Step 4: Draft the notice

• [ ] Rent increase notice includes all required elements (current rent, new rent, percentage, effective date, CPI-U source)
• [ ] Notice is dated and ready for delivery
• [ ] Effective date is at least 60 days from delivery date

Step 5: Deliver the notice and retain proof

• [ ] Notice delivered by first-class mail (keep post office receipt)
• [ ] OR notice personally delivered (keep signed receipt)
• [ ] OR notice emailed with tenant confirmation of receipt
• [ ] File copy with CPI-U documentation and delivery proof in tenant file

Step 6: Ongoing compliance documentation

• [ ] Create a rent increase log with columns: tenant name, effective date, old rent, new rent, increase amount, increase percentage, CPI-U used, notice delivery date, delivery method
• [ ] Update this log with each increase
• [ ] Store indefinitely (retain for at least 7 years minimum)

CPI-U Reference Table: Recent Years and Maximum Allowable Increases

12-Month Period Ending	CPI-U %	7% Cap	Allowable Max Increase
August 31, 2024	2.4%	7.0%	2.4%
August 31, 2025 (projected)	3.1% (est.)	7.0%	3.1% (est.)
August 31, 2026 (hypothetical)	4.5% (assumed)	7.0%	4.5% (assumed)

Note: These figures are based on recent actual data (2024) and projections (2025–2026). Verify the current CPI-U on bls.gov before issuing any rent increase notice.

Penalties for Violating the Rent Cap

RCW 59.18.140 does not explicitly state penalties in the statute itself, but violations trigger liability under Washington’s broader landlord-tenant enforcement framework:

Tenant Remedies:

• Wrongful increase damages: A tenant can sue for the amount of rent charged in excess of the legal cap, plus interest at the rate of 12% per annum (RCW 59.18.150)
• Attorney fees and costs: If a tenant successfully challenges a rent increase, you must pay their attorney fees and court costs (RCW 59.18.150)
• Treble damages possible: If you act “in bad faith” or with intent to violate the law, a court may award three times the actual damages (retaliatory conduct)
• Retaliation claims: If a tenant believes the increase was retaliation for requesting repairs or reporting code violations, they can file a retaliation claim under RCW 59.18.240

Example scenario: You increase rent from $1,500 to $1,700 (13.3%) when the allowable increase was 3%. A tenant sues.

• Excess charged per month: $1,700 − $1,545 = $155
• If increase was in effect for 12 months: $155 × 12 = $1,860 in damages
• Add 12% annual interest: $1,860 × 0.12 = $223.20
• Add tenant attorney fees (typically $2,500–$5,000+)
• Total liability: $4,000–$8,000+

Enforcement by State Attorney General: While the AG’s office does not typically prosecute individual rent increase violations, they can intervene in patterns of systematic non-compliance affecting multiple tenants. Repeated violations on multiple properties could trigger AG investigation.

Local enforcement: Some cities (Seattle, Tacoma, Olympia) have their own rent control enforcement offices. Violations may trigger additional fines ranging from $250–$1,000 per violation in some jurisdictions, though Washington state law itself does not specify statutory penalties.

How to Document Your Compliance Defensively

If a tenant challenges your rent increase, you will need to prove you complied with the law. Create a Rent Increase Documentation File containing:

1. CPI-U Source Documentation
   • Screenshot or printout from bls.gov showing the specific CPI-U figure you used
   • Date of access
   • URL of the source page
2. Calculation Worksheet
   • Dated document showing: current rent, CPI-U %, 7% cap, lower figure selected, dollar calculation, new rent
   • Handwritten calculations are acceptable and preferable (shows contemporaneous intent)
3. Notice Delivery Proof
   • USPS tracking number or Certified Mail receipt for mailed notice
   • Signed receipt for personal delivery
   • Email delivery confirmation if applicable
4. Dated Notice Copy
   • Original notice as delivered, with delivery date annotated
5. Calendar/Timeline
   • Spreadsheet showing notice delivery date and effective date, confirming 60+ day gap

Organize all this in a single file folder (digital or physical) labeled “Rent Increase — [Tenant Name] — [Effective Date].” If you manage multiple units, use a master spreadsheet to track all increases. LeaseBase’s compliance engine automates this documentation and flags non-compliant increases before you send them.

How to Stay Compliant Year After Year

Automation and Planning

Self-managing landlords often struggle with timing. Here’s a proactive approach:

1. Set calendar reminders on August 15 each year to check the upcoming CPI-U figure (released mid-September)
2. Plan increases on anniversary dates — If a tenant’s lease renews December 1, plan the increase for December 1 of the next year; this creates a predictable cycle
3. Calculate increases at least 75 days before the effective date — This gives you time to review, ensure compliance, draft the notice, and deliver it 60+ days before effectiveness
4. Use standardized templates — Create a form notice that includes all required language; fill in the tenant name, amounts, and CPI-U figure only
5. Track exemptions carefully — Maintain a spreadsheet noting which units are newly constructed, which units are owner-occupied (if applicable), and when the 5-year exemption expires for each unit

Red Flags to Avoid

• Do not increase rent by a round percentage (e.g., always 5% or 7%) unless that’s what the law allows. Rounding up violates the cap.
• Do not issue rent increase notices less than 60 days before the effective date
• Do not tie rent increases to tenant complaints, repair requests, or disputes (this creates retaliation liability)
• Do not increase rent if the tenant is currently disputing habitability issues or has reported code violations
• Do not use outdated CPI-U figures (only use the figure for the most recent August 31 date)

Interaction with Local Rent Control Ordinances

Washington’s HB 1217 establishes a statewide floor, but some cities have more restrictive local ordinances. If you own property in one of these cities, you must comply with the stricter rule:

Seattle (SMC 14.30): Limited to 7% or CPI-U (same as state law, so HB 1217 aligns)

Tacoma (TMC 8.72): Limited to 5% or CPI-U (more restrictive than state law; you must use the 5% cap in Tacoma only)

Olympia (OMC 8.130): Limited to 5% or CPI-U (more restrictive; use the 5% cap in Olympia)

Important rule: When local law is stricter than state law, the local law governs. Your rent increases in Tacoma cannot exceed 5% even though the state allows up to 7% (if CPI-U permits). Always verify your city’s local ordinance when setting rents.

Washington state landlord-tenant law resources include a complete directory of municipal rent control ordinances.

FAQs on Washington HB 1217 Rent Increases

Q1: Can I increase rent on the anniversary of the lease, or only on January 1?

A: You can increase rent on the lease anniversary date. RCW 59.18.140 applies to all lease renewal periods, not just calendar-year renewals. If a tenant’s lease renews June 1, you can issue a rent increase notice effective June 1 (with 60 days’ prior notice, so notice issued on or before April 1). The CPI-U figure used is still the 12-month CPI-U ending the previous August 31, regardless of your lease anniversary date.

Q2: What if I made a mistake on the rent increase notice—can I issue a corrected notice?

A: If you issued an incorrect notice (e.g., wrong dollar amount or percentage), you should issue a corrected notice with a new 60-day notice period. Do not assume the original defective notice is valid. To be safe, contact the tenant in writing, explain the error, withdraw the original notice, and issue a corrected one. This approach is safer than litigating whether the defective notice was “substantially compliant.”

Q3: Do I have to increase rent every year, or can I skip a year?

A: You are not required to increase rent every year. You may skip years or increase rent every other year. The 7%/CPI-U cap applies only to the increases you choose to impose. However, if you do not increase rent in Year 1, you cannot “catch up” with a 14% increase in Year 2; each increase is independently capped at the then-applicable limit.

Q4: If a unit is newly constructed, can I charge market rate without any cap, then apply the cap after five years?

A: Yes. For the first five years of occupancy, a newly constructed unit is fully exempt from the rent cap. You can increase rent to any amount (market rate) during those first five years, subject only to the requirement of 60 days’ notice and that increases not be unconscionable. However, once the unit is no longer “newly constructed” (after five years), all future increases are capped at 7%/CPI-U. This means a first lease-renewal increase after the five-year period must comply with the cap.

Q5: What should I do if a tenant refuses to pay the increased rent?

A: If you issued a legally compliant rent increase notice with 60+ days’ notice, and the tenant refuses to pay the new amount, you can proceed with a non-payment eviction under RCW 59.18.130. However, the tenant will likely defend by arguing the increase is unlawful. Do not issue a non-payment notice unless you are confident your increase complies with the 7%/CPI-U cap. Consult an attorney before filing if there is any question of compliance. If the increase was unlawful, pursuing an eviction will backfire, costing you attorney fees and potentially exposing you to retaliation claims.

Tools and Resources for Ongoing Compliance

U.S. Bureau of Labor Statistics CPI Data: Visit bls.gov/data and search for “CPI-U” or Series ID CPIAUCSL. Set up a monthly BLS email alert for CPI releases (typically released mid-month for the prior month’s data).

Washington Residential Tenancy Act (RCW 59.18): Full statute available at app.leg.wa.gov. Section 59.18.140 is the rent cap statute; section 59.18.060 covers notice requirements.

Local Rent Control Ordinances: City of Seattle Municipal Code (SMC) 14.30, City of Tacoma Municipal Code (TMC) 8.72, City of Olympia Municipal Code (OMC) 8.130. Check your city’s website if you own property within city limits.

LeaseBase Resources:

• Rent payments and tracking — Track rent due, received, and increases applied
• Lease operations — Generate compliant rent increase notices with CPI-U auto-populated
• Compliance engine — Flag non-compliant increases before sending; maintain audit trail of all notices and CPI sources
• Portfolio management — Centralized tracking of all units, exemptions, and lease anniversary dates across your portfolio
• Washington landlord-tenant law guides — Ongoing updates to HB 1217 and municipal ordinance changes

Key Dates and Deadlines for 2026

Action	Deadline / Date	Notes
BLS releases CPI-U for Aug 31, 2025	Mid-September 2025	This figure applies to increases effective Oct 1, 2025 or later
Last day to issue rent increase notice (for Oct 1, 2025 increase)	August 1, 2025	60 days before Oct 1 effective date
Rent increases effective Oct 1, 2025 or later must use CPI-U ending Aug 31, 2025	October 1, 2025+	This applies to all increases effective on or after Oct 1, regardless of lease anniversary
BLS releases CPI-U for Aug 31, 2026	Mid-September 2026	This figure applies to increases effective Oct 1, 2026 or July 22, 2026 Washington HB 1217 Rent Cap: 7% Annual Limit & CPI Formula Explained — 2026 Compliance Guide Key Takeaways 7% annual cap applies statewide — RCW 59.18.140 limits rent increases to 7% or the Consumer Price Index (CPI) plus 1%, whichever is lower, effective January 1, 2024 CPI formula recalculates yearly — the limit resets each anniversary of the tenancy; you must use the U.S. Bureau of Labor Statistics CPI-U figure for the 12-month period ending August 31 Limited exemptions exist — newly constructed units (first 5 years), certain subsidized housing, and units with owner occupancy exemptions may have different rules; most standard rentals are covered Violations carry serious penalties — illegal rent increases are unenforceable, tenants can recover treble damages plus attorney fees, and repeat violations may trigger enforcement action by state AG or local authorities Notice requirements remain strict — you must provide written notice of any rent increase at least 30 days before the increase takes effect, or longer per lease terms Documentation is critical — keep CPI calculations, lease renewal notices, and payment records; the burden is on you to prove compliance if challenged Understanding Washington’s Statewide Rent Cap Under HB 1217 On January 1, 2024, Washington State implemented one of the nation’s most restrictive statewide rent increase caps. Unlike California or Oregon, which apply percentage limits selectively, Washington’s law under RCW 59.18.140 applies broadly to nearly all residential tenancies in the state—with few exceptions. For self-managing landlords with 2–75 units, this law fundamentally changes how you can raise rent and requires new compliance workflows. The law doesn’t ban rent increases. Instead, it creates a hard ceiling: you cannot raise rent more than 7% or the Consumer Price Index (CPI) plus 1%, whichever is lower. This dual-trigger mechanism means your allowable increase changes year to year based on inflation. What makes this law especially important for compliance is that it’s not optional, it’s not negotiable, and violations have teeth. Tenants can sue for treble damages (three times the excess rent charged) plus attorney fees. State attorneys general and local prosecutors have enforcement authority. Repeat or willful violations can result in damages awards of up to $5,000 per violation, plus civil penalties. The 7% Ceiling vs. the CPI+1% Formula: How to Calculate Your Legal Rent Increase The statute gives you two options each year; you must use whichever is lower: Option 1: 7% increase on the current rent Option 2: CPI-U increase plus 1 percentage point In practice, when inflation is low (under 6%), the CPI+1% formula will be your limit. When inflation spikes, the 7% ceiling becomes your limit. The CPI Calculation: Step-by-Step Washington law specifies the exact CPI figure you must use. Per RCW 59.18.140, the applicable CPI is the Consumer Price Index for All Urban Consumers (CPI-U) for the Seattle-Tacoma-Bellevue area, or if that series is discontinued, a replacement series as determined by rule. Here’s the precise calculation window: Use the CPI-U figure for the 12-month period ending August 31 of the year before the rent increase takes effect Compare that 12-month period to the prior 12-month period (August 31 of the year before that) The percentage change between those two periods is your CPI figure Add 1 percentage point to that CPI figure Compare to 7%; use the lower number Worked Example (2026) Assume a tenant’s lease renews on July 1, 2026. You need to calculate the allowable increase: Step 1: Get CPI-U (Seattle-Tacoma-Bellevue, 12-month period ending August 31, 2025) vs. 12-month period ending August 31, 2024 Step 2: Assume that figure shows a 3.2% increase year-over-year Step 3: 3.2% + 1% = 4.2% Step 4: Compare 4.2% to 7% Step 5: 4.2% is lower, so your rent increase limit is 4.2% If the tenant currently pays $1,200/month, the maximum new rent is $1,200 × 1.042 = $1,250.40/month. The burden is on you to maintain this calculation and document it. If a tenant disputes the increase, you must prove the CPI figure you used was correct, current, and properly sourced from the U.S. Bureau of Labor Statistics. Exemptions and Carve-Outs: What’s NOT Covered by the Cap HB 1217 is broad, but not universal. Certain categories of housing are exempt or have modified rules: 1. Newly Constructed Units (First 5 Years) Residential units where the certificate of occupancy was issued less than 5 years before the rent increase are exempt from the cap during that 5-year window. This exemption is designed to encourage new construction. Once a unit passes the 5-year threshold from occupancy, the cap applies. Compliance note: You must have documentation of the certificate of occupancy date. Keep this in your records. If you’re adding a new unit to your portfolio, mark the 5-year anniversary in your calendar or property management system. 2. Owner-Occupied Exemptions If the property meets certain owner-occupancy criteria (specific unit types in buildings with 1–4 units where the owner occupies one unit), different rules may apply. However, this exemption has been narrowed and applied inconsistently. Do not assume your property qualifies without legal review. 3. Subsidized or Public Housing Units receiving federal or state rental assistance (Section 8, project-based vouchers, public housing) may have rents set by subsidy formulas rather than tenant-paid increases. However, your obligation to not exceed the 7% cap still applies to the tenant-paid portion or any non-subsidized component. 4. Tenancies That End Before Increase Takes Effect If a tenancy ends and a new tenant moves in, the cap typically does not apply to the first lease term with the new tenant (setting initial rent is different from increasing rent for an existing tenant). However, once a new tenant signs, increases on renewal are capped. What IS Covered (The Default Rule) Unless your unit falls into one of the narrow exemptions above, the cap applies if: The unit is in Washington State It’s a residential tenancy (RCW 59.18 applies) The tenancy is ongoing (not a new-tenant initial lease) You are raising the rent, not setting it for the first time This covers the vast majority of self-managed portfolios: apartments, single-family homes, condos, townhouses, duplexes, and multi-unit buildings. Notice Requirements: Timing and Content Mandates Calculating the correct increase is only half the compliance battle. You must also provide proper written notice. Minimum Notice Period: 30 Days (or More) RCW 59.18.140 requires that any rent increase be preceded by written notice given at least 30 days before the effective date of the increase. If your lease requires longer notice (e.g., 60 days), you must comply with the lease term, not the statute’s minimum. Notice must be in writing. Email, certified mail, hand-delivery, or posting (if permitted by lease) all count, but you must be able to prove the tenant received it or had opportunity to receive it. Required Content of Notice The notice must include: Current rent amount New rent amount Effective date of increase Clear statement that this is a rent increase notice Washington does not require you to cite the CPI calculation or explain the legal basis in the notice itself, but best practice is to document your calculation internally. If a dispute arises, you can produce that documentation. Timing Trap: Month-to-Month vs. Fixed-Term Leases For month-to-month tenancies, the 30-day notice period must end on the last day of a rental period (typically the last day of a calendar month). If you give notice on July 15 to raise rent effective August 15, the increase likely won’t be valid until September 1 (the start of the next rental period), even though 30 days have passed. Your lease should specify the rental period to avoid this pitfall. For fixed-term leases, the increase takes effect on the renewal date specified in the lease, provided notice was given at least 30 days prior. Penalties and Enforcement: What Happens If You Violate the Cap This is where compliance gets serious. Washington’s enforcement mechanisms are strong, and violations are costly. Treble Damages and Attorney Fees If a tenant challenges a rent increase and proves it exceeded the cap, you must refund the excess rent plus two additional amounts equal to the excess (treble damages), plus the tenant’s attorney fees and court costs. This is a statutory remedy under RCW 59.18.140. Example: You charged $100/month in excess rent for 12 months (total $1,200). You must refund $1,200, plus $2,400 in damages (two additional amounts), plus the tenant’s attorney fees (potentially $1,500–$5,000+). Your total exposure: $4,600–$8,600+ on a single unit. Enforcement by State Authorities The Washington State Attorney General and county prosecutors have authority to investigate and prosecute violations. Willful or repeat violations can result in civil penalties of up to $5,000 per violation. This applies separately to each unlawful increase, meaning a portfolio with multiple units could face $5,000–$50,000+ in penalties. Unlawful Detainer Defense If you attempt to evict a tenant for non-payment of an illegal rent increase, the tenant can assert the increase as an affirmative defense. The eviction will be dismissed, and you could face sanctions. Tenant Right to Withhold and Offset Some tenants may withhold excess rent or offset it against security deposits or future rent. Attempting to evict for non-payment on an unlawful increase can backfire legally. Compliance Workflow: Staying Legally Ahead To avoid these penalties and stay compliant, use this workflow: 1. Track Lease Renewal Dates (12 Months in Advance) Create a calendar in your property management system or spreadsheet showing every lease renewal date for every unit. Mark a reminder 6 months before the renewal date. 2. Obtain Current CPI Data (60 Days Before Renewal) Visit the U.S. Bureau of Labor Statistics website (bls.gov) and pull the CPI-U data for Seattle-Tacoma-Bellevue. Download the 12-month figure ending August 31 of the prior year. Save it as a PDF and date-stamp it. 3. Calculate Both Limits (45 Days Before Renewal) Spreadsheet or document: Current rent: $_____ 7% increase: $_____ (current rent × 1.07) CPI-U (12-month ending Aug 31, [prior year]): ____% CPI + 1%: ____% (add 1 to the CPI figure) CPI+1% increase: $_____ (current rent × [1 + CPI+1%]) Legal limit: _____ (use the lower of 7% or CPI+1%) New rent amount: $_____ (current rent × legal limit) 4. Draft and Send Notice (30+ Days Before Effective Date) Use a template that includes current rent, new rent, effective date, and a statement that the increase complies with state law. Send via certified mail or hand-delivery. Keep proof of delivery in your records. 5. Document Everything Keep all CPI calculations, notices, proof of delivery, and lease documents in a single folder per unit. If a dispute arises, you can produce this documentation within hours, not days. Special Situations and Edge Cases What If You Bought the Property Mid-Lease? You inherit the existing lease and its rent-increase obligations. The cap applies to any increase you propose after the lease renewal date. You cannot circumvent the cap by claiming you’re a new owner. What About Utilities, Parking, or Fees? The cap applies to “rent” (the base housing payment). Separately itemized charges for utilities, parking, laundry, or pet fees are generally not “rent” under Washington law, but this is an evolving area. Best practice: treat all housing-related charges as subject to the cap unless your lease clearly itemizes them as add-ons pre-approved by the tenant. Can You Charge a Lease Renewal Fee? No. Washington has no lease renewal fee authorization. The only authorized charges are rent and optional services (parking, etc.). Trying to charge a “renewal fee” will violate the cap and create additional liability. Multi-Year Leases If a tenant signs a 2-year lease, the cap applies when that lease ends and you propose a new rent for the renewal period. During the 2-year term, rent is locked in per the lease terms. How LeaseBase Helps You Stay Compliant Managing the 7% cap across multiple units requires precision and documentation. LeaseBase’s compliance engine tracks your lease renewal dates, flags approaching deadlines, and calculates your legal rent-increase limit based on current CPI data. You input current rent and unit details; the system tells you the maximum allowable increase and generates notice templates. Rent payment tracking also helps because it documents what rent you actually collected, making it easy to prove compliance if a dispute arises. And automated compliance reporting consolidates all notice dates, calculations, and lease terms in one searchable archive. FAQ: Common Questions About HB 1217 Compliance Q: Can I charge more than the cap if the tenant agrees? A: No. RCW 59.18.140 is a floor/ceiling rule; it cannot be waived by contract or tenant consent. Any waiver clause in a lease is void. The cap is mandatory. Q: What if CPI goes negative (deflation)? A: If CPI-U declines, the formula (CPI + 1%) could produce a negative or zero increase. You would not be allowed to raise rent at all that year. You could only maintain current rent or negotiate a renewal at the current rate. A few jurisdictions have experienced this; Washington has not yet. Q: Do I have to use the Seattle-Tacoma-Bellevue CPI, or can I use state-level CPI? A: The statute specifies Seattle-Tacoma-Bellevue for the entire state. Even if you own property in rural Eastern Washington, you use the Seattle metro CPI figure, not a regional or statewide average. This creates uniformity across the state. Q: If I miss the 30-day notice window, what happens? A: The increase is postponed to the next valid rent-increase date (the next lease renewal or rental period). You cannot retroactively apply an increase if notice was not timely. Attempting to do so creates liability for excess rent charged and may trigger treble-damages claims. Q: Are Section 8 or subsidized units exempt? A: Not entirely. Rent determination formulas set by subsidy programs may allow increases above 7%, but you must comply with both the subsidy program rules AND the state cap. If there’s a conflict, the more restrictive rule applies. Consult with your subsidy program administrator or legal counsel. Q: What if a tenant breaks their lease early—do I still have to offer the same capped increase if they re-sign? A: If a tenancy ends and you re-lease to the same tenant, it’s treated as a new tenancy. You can set the initial rent without the cap. However, once the new lease renews, the cap applies again. Do not use early lease breaks as a loophole to reset rents above the cap, as courts may view this as circumvention. Documentation Checklist: What to Keep on File ☐ Original lease with rent amount and renewal date ☐ Certified CPI-U data printout from BLS website, dated ☐ Calculation spreadsheet showing 7% vs. CPI+1%, with the lower amount selected ☐ Rent increase notice, dated and signed ☐ Proof of delivery (certified mail receipt, hand-delivery signature, etc.) ☐ Lease renewal agreement with new rent amount ☐ Rent payment records showing the new amount was charged ☐ Any correspondence with tenant regarding the increase Keep all documents for at least 4 years (the statute of limitations for civil claims in Washington). Organize by unit, then by date. Final Compliance Takeaway HB 1217’s 7% cap and CPI+1% formula are now the law across Washington. They apply to nearly every residential tenancy you manage. Violations are expensive—treble damages, attorney fees, and state civil penalties can exceed $5,000 per violation. But compliance is straightforward if you use a systematic approach: track renewal dates, pull current CPI data annually, calculate both limits, choose the lower one, send 30-day notice, and document everything. For self-managing landlords, this means adding a compliance layer to your annual operations. Lease operations tools and portfolio management systems make this easier than manual tracking, reducing the risk of missed deadlines or miscalculated increases. The stakes are too high to rely on guesswork or old practices. Know your legal limit before you send that notice. Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney licensed in Washington for guidance specific to your situation. Rent-increase laws are complex and subject to change. This article reflects the law as of July 2026 and may not capture future amendments. July 21, 2026 Oregon Rent Increase Calculation: CPI Formula & Compliance Guide (2026) Key Takeaways Oregon caps rent increases at the percentage increase in the Consumer Price Index (CPI) published by the U.S. Bureau of Labor Statistics — ORS 90.323(2) sets this as the legal ceiling for annual increases, with no flat dollar amount permitted. You must provide written notice at least 90 days before the rent increase takes effect — failure to give proper notice voids the increase and may trigger tenant claims for wrongful rent collection. The CPI figure you must use is the “Consumer Price Index for All Urban Consumers (CPI-U)” for the Portland-Salem-Eugene area — using a different CPI index or national figure violates the statute. Rent increases are prohibited within the first year of tenancy — even if CPI exceeds zero, you cannot raise rent on new leases until month 13 or the lease renewal date. Violations result in the increase being void, plus tenant claims for unjust enrichment and statutory damages — Oregon courts have awarded tenants full refunds plus penalties. The CPI figure changes annually on July 31st — you must use the most recent published data when calculating increases for rent due on or after the effective date. What Is Oregon’s Rent Increase Cap? Oregon has one of the nation’s strictest rent increase caps. Under ORS 90.323(2), the maximum allowable annual rent increase is tied directly to the Consumer Price Index (CPI) published by the U.S. Bureau of Labor Statistics. This is not a percentage you set. It is not negotiable. It is not a guideline. It is a hard legal ceiling. Any rent increase that exceeds the CPI percentage is unenforceable under Oregon law, and tenants can challenge the increase in court or before the Bureau of Labor and Industries (BOLI). The statute reads: “The owner of a rental unit may not increase rent in an amount that exceeds the percentage change in the Consumer Price Index for All Urban Consumers (CPI-U) for the Portland-Salem-Eugene area.” This language is absolute. There are no exceptions for market conditions, property improvements, or increased operating costs (outside of utilities covered under separate utility billing arrangements). Unlike some states that allow a flat percentage increase (e.g., 3% annually) or tie increases to inflation with a cap-and-floor formula, Oregon’s approach is inflation-only with zero guaranteed increase. If CPI is negative (deflation), you cannot raise rent at all. If CPI is 0.5%, you cannot raise rent by 1%. Understanding the CPI-U and the Correct Index to Use Many landlords make a critical error: they use the national Consumer Price Index instead of the Portland-Salem-Eugene regional index, or they use the wrong month’s data. Both mistakes create legal exposure. You must use the CPI-U (Consumer Price Index for All Urban Consumers) for the Portland-Salem-Eugene, Oregon metropolitan area. The Bureau of Labor Statistics publishes CPI data monthly, but Oregon’s statute requires use of the specific regional index. The Portland-Salem-Eugene area includes Multnomah, Washington, Clackamas, Marion, Polk, and Yamhill counties. If your rental property is outside this region, you still use this index under ORS 90.323(2)—the statute does not carve out exceptions for rural areas or other Oregon regions. The critical timing rule: The CPI figure you must use is published on or about the 31st of July each year. This figure represents the 12-month change in the index ending in June. You use this annual July release to calculate increases that take effect on or after August 1st of that year. For example: The July 31, 2026 CPI-U release shows a 2.8% increase in the Portland-Salem-Eugene index for the 12-month period ending June 2026. You can notify tenants on or after August 1, 2026 that their rent will increase by up to 2.8%. The increase takes effect no sooner than 90 days after notice (minimum November 1, 2026). You cannot use the July 31, 2025 CPI figure (even if it was higher at 3.1%) to justify a 3.1% increase in November 2026. You can access the correct CPI figure from the Bureau of Labor Statistics website (bls.gov) or request historical data. Many landlord associations and property management platforms publish the annual Oregon CPI figure shortly after the July 31st release to help landlords comply. Step-by-Step: How to Calculate Your Rent Increase Correctly Step 1: Determine Your Notice Timing and the Correct CPI Figure Before you calculate anything, establish when you want the increase to take effect. This determines which CPI figure you must use. Rule: You must provide written notice at least 90 days before the first rent payment at the increased amount is due. If you want an increase effective November 1, 2026, your notice must be delivered by August 1, 2026 at the latest. The CPI figure applicable to that increase is the one published on July 31, 2026 (covering the 12-month period ending June 2026). If you miss the August 1 deadline, you cannot use that CPI figure for a November 1 increase. You must wait until you can give proper 90-day notice using the next available CPI figure (published July 31, 2027). Step 2: Locate the Correct CPI-U Figure for Portland-Salem-Eugene Visit the BLS website and navigate to their CPI tables for Portland-Salem-Eugene, Oregon (Series ID APUS49A74714): All items in U.S. city average, not seasonally adjusted. Look at the annual average for the most recent 12-month period. Example data (hypothetical for illustration): Period CPI-U Index Value Percentage Change June 2025 (12-month) 315.7 — June 2026 (12-month) 324.1 2.66% The BLS website typically calculates and displays this percentage change for you. Record this figure accurately—rounding errors matter. Step 3: Calculate the New Rent Amount Multiply the current monthly rent by the CPI percentage increase (expressed as a decimal). Formula: New Rent = Current Rent × (1 + CPI percentage) Example: Current rent: $1,400/month CPI percentage: 2.66% Calculation: $1,400 × (1 + 0.0266) = $1,400 × 1.0266 = $1,437.24 New rent: $1,437.24/month You may round to the nearest penny, but you cannot round up beyond what the formula produces. If the calculation yields $1,437.24, you cannot charge $1,437.50 or $1,438. Rounding that increases the effective percentage above CPI violates ORS 90.323(2). Step 4: Prepare Written Notice The notice must be in writing and must include: The current rent amount The new rent amount The effective date (no sooner than 90 days from delivery of notice) Clear statement that this is a rent increase under ORS 90.323(2) The CPI percentage used (optional but recommended for transparency and compliance documentation) Oregon law does not prescribe a specific notice form, but your notice must be clear and unambiguous. Avoid language that could be interpreted as a conditional increase or one tied to other factors (e.g., “increased costs” or “market rates”). State only the increase amount and effective date. Recommended language: “This is notice of a rent increase under Oregon Revised Statute 90.323(2). Effective [date], your rent will increase from $[current] to $[new] per month. This increase reflects the Consumer Price Index increase published by the U.S. Bureau of Labor Statistics.” Step 5: Deliver Notice and Maintain Proof of Delivery Deliver the notice in writing. Oregon law permits delivery by: Hand delivery (in person) Certified mail or first-class mail to the tenant’s address on file Email (if the tenant has agreed to electronic notice) Door posting (if the tenant cannot be located after reasonable efforts) Proof of delivery is critical. If a tenant later disputes whether they received proper notice, you bear the burden of proving timely delivery. Keep: A signed delivery receipt (for hand delivery) USPS mail tracking (for certified mail) Email read receipts or delivery confirmations Photos showing posted notice with date stamp Your own dated records of when notice was sent Without proof, a tenant can claim you failed to give 90 days’ notice, which voids the increase entirely. Critical Compliance Rules You Cannot Violate No Increases in the First Year Under ORS 90.323(3), you cannot increase rent during the first year of a tenancy. This applies even if the tenant has been there for 11 months and CPI is rising. The prohibition is strict: “During the first year that a tenant occupies a rental unit, the owner may not increase the rent.” The first year runs from the commencement date of the tenancy (the date the tenant takes occupancy), not from the lease signing date. If a tenant moves in on March 15, 2026, the first-year prohibition ends on March 15, 2027. You cannot raise rent until the first increase takes effect on or after March 15, 2027 (with 90 days’ notice). The 90-Day Notice Requirement Is Non-Negotiable ORS 90.323(2) requires notice “at least 90 days before the rent increase takes effect.” This is not 90 days before you can *propose* an increase or 90 days before you *intend* to increase. It is 90 days before the tenant’s rent payment at the new amount is due. If rent is due on the 1st of each month: To increase rent effective November 1, 2026, notice must be delivered by August 1, 2026. Notice delivered on August 2, 2026 allows the increase to take effect no earlier than November 2, 2026 (91 days later). Notice delivered on August 2, 2026 for a November 1, 2026 effective date is insufficient and voids the increase. Do not rely on informal notices, text messages, or verbal conversations. Written notice is mandatory. Do not assume a tenant understood an increase because you mentioned it in passing. No Increases Above the CPI Percentage You cannot justify an increase above CPI by citing property improvements, increased property taxes, insurance costs, or market conditions. ORS 90.323(2) is a ceiling. There are no exceptions. If a tenant makes significant improvements to the unit (e.g., adds a built-in bookshelf at their own expense), you still cannot increase rent above CPI. If your property taxes increase by 15% in a given year, you still cannot increase rent above CPI. The only exception is for utilities. If you provide utilities and the cost increases, you may adjust the rent to reflect the increased utility cost, separately and in addition to the CPI increase, under ORS 90.320(15). This requires a written addendum and specific documentation of utility costs. Do not assume you can bundle a utility adjustment into the CPI increase; they are separate calculations. What Happens If You Violate the Rent Increase Rules The Increase Is Void If you increase rent in violation of ORS 90.323, the increase is not enforceable. You cannot collect the higher rent amount. A tenant can refuse to pay the increased amount, and a court will not order them to do so. Tenant Claims for Damages A tenant can file a claim against you for: Unjust enrichment: The difference between what you illegally collected and what you should have collected, refunded in full. Statutory damages: Some Oregon courts have awarded tenants penalties under ORS 90.100 (civil remedies for landlord violations). Attorney fees: If a tenant retains a lawyer to challenge an illegal increase and prevails, you may be ordered to pay their attorney fees. Oregon courts interpret ORS 90.323 strictly in favor of tenants. Ignorance of the law is not a defense. BOLI Complaints and Administrative Action A tenant can file a complaint with the Oregon Bureau of Labor and Industries (BOLI), which enforces landlord-tenant law. BOLI can investigate, mediate disputes, and issue cease-and-desist orders. Repeat violations can result in BOLI referring cases to the Oregon Attorney General for civil enforcement. Eviction Risk If You Attempt Collection If you attempt to evict a tenant for non-payment of an illegally increased rent, the tenant can raise the illegality as a defense. An Oregon court will dismiss the eviction, and you may face a counterclaim for damages. Attempting to evict based on an illegal rent increase is a form of retaliatory conduct under ORS 90.385. 2026 CPI Data and Practical Examples As of July 2026, Oregon landlords should use the CPI-U figure published on July 31, 2026, covering the 12-month period ending June 2026. (At the time of this article’s publication in July 2026, the exact percentage is available through the BLS website.) For planning purposes, here are scenarios showing how the calculation works: Current Rent CPI: 2.0% CPI: 2.5% CPI: 3.0% $1,200 $1,224 $1,230 $1,236 $1,500 $1,530 $1,537.50 $1,545 $2,000 $2,040 $2,050 $2,060 These examples illustrate why precision matters. If you own 20 units and misunderstand the CPI figure by 0.5%, you could be collecting illegally increased rent from dozens of tenants simultaneously. Compliance Checklist: Before You Issue a Rent Increase Notice Use this checklist to avoid violations: ☐ Verify the tenant’s first-year status: Is this tenant past the 12-month mark of their tenancy? If not, stop. No increase is allowed. ☐ Obtain the correct CPI-U figure: Have I retrieved the Portland-Salem-Eugene CPI-U from the BLS website for the correct month (July publication date)? Have I recorded the exact percentage change? ☐ Calculate the new rent amount: Have I used the formula: Current Rent × (1 + CPI%)? Have I checked my math twice? ☐ Determine the effective date: Will the new rent take effect at least 90 days after I deliver notice? ☐ Draft written notice: Have I prepared a clear, written notice (not verbal, not email without confirmation of receipt)? Does it state the current rent, new rent, and effective date? ☐ Deliver notice properly: Have I delivered the notice by a method that creates proof (certified mail, hand delivery with receipt, email with read receipt)? ☐ Document everything: Have I retained a copy of the notice, proof of delivery, the CPI figure used, and my calculation worksheet? ☐ Wait the full 90 days: Have I counted forward from the delivery date to confirm the effective date is at least 90 days away? How Compliance Software Can Prevent Costly Errors Many self-managing landlords rely on spreadsheets, email, or memory to track rent increase deadlines and calculations. This approach creates risk. One missed deadline, one rounding error, one tenant dispute—and you’re facing a legal claim. A compliance-aware platform like LeaseBase’s rent payment tools can automate the tracking of when tenants become eligible for increases (first-year block), store the correct CPI-U data for your state, calculate increases precisely, and alert you when the 90-day notice window opens. The system generates compliant notice templates and logs delivery proof. Paired with LeaseBase’s compliance engine, you can verify that each increase adheres to Oregon law before it takes effect. This removes guesswork and gives you confidence that you’re not exposing yourself to tenant claims or BOLI complaints. For landlords managing multiple units, this automation is not a convenience—it is essential. One illegal increase across 10 units could cost you thousands in refunds and legal fees. FAQ: Oregon Rent Increase Calculation Q1: Can I increase rent by a flat amount instead of a percentage (e.g., $50 per month)? No. ORS 90.323(2) explicitly limits increases to the CPI percentage. You cannot offer a choice between a percentage and a flat amount, and you cannot increase by any amount the statute does not permit. Flat-dollar increases are void under Oregon law, even if the tenant agrees to them. Q2: If CPI is negative (deflation), can I leave rent flat instead of decreasing it? Yes, with a critical caveat. Oregon law does not permit you to increase rent above CPI, but it also does not require you to decrease rent if CPI is negative. You may maintain the current rent. However, once you establish a rent amount, you are bound by it until the next annual increase opportunity. You cannot argue that you “would have decreased rent if deflation had continued”—the choice is binary: increase within the CPI ceiling, or maintain current rent. Q3: What if the tenant disputes the CPI figure I used? Who bears the burden of proof? You do. If a tenant challenges an increase as exceeding CPI, you must prove that you used the correct Portland-Salem-Eugene CPI-U figure from the BLS and that your calculation is accurate. You should retain documentation: screenshots of the BLS website showing the figure, your calculation worksheet, and the date you obtained the data. Without this proof, a court will likely invalidate the increase and award damages to the tenant. Q4: Can I increase rent if the tenant hasn’t paid utilities, and I’m trying to recover those costs? Not through the standard CPI increase. Utility cost recovery is a separate mechanism under ORS 90.320(15). If you provide utilities and costs increase, you must calculate a utility adjustment separately from the CPI increase. The utility adjustment must be supported by documentation of actual utility cost increases. It is not included in the CPI increase amount. Mixing the two is a violation. Q5: If I own properties in multiple Oregon counties, do I use different CPI figures for each? No. ORS 90.323(2) requires use of the “Portland-Salem-Eugene area” CPI-U regardless of where the rental unit is located. Even if you own a property in Bend or Klamath Falls, you use the Portland-Salem-Eugene figure. Oregon has not established separate CPI benchmarks by region. Key Dates and Deadlines for July–December 2026 Date Action July 31, 2026 BLS publishes CPI-U for Portland-Salem-Eugene (12-month period ending June 2026). Landlords can now use this figure for increases effective November 1, 2026 or later. August 1, 2026 Deadline to deliver notice for November 1, 2026 increases (90 days before effective date). November 1, 2026 First rent increase based on July 2026 CPI figure takes effect (for notices delivered by August 1). December 1, 2026 Last possible effective date for increases using July 2026 CPI figure (notices must be delivered by September 1, 2026). Resources for Accurate CPI Data U.S. Bureau of Labor Statistics (BLS): bls.gov — Search “Portland-Salem-Eugene” CPI-U data. Series ID: APUS49A74714. Oregon Bureau of Labor and Industries (BOLI): oregon.gov/boli — Enforcement agency; file complaints or request guidance on compliance. Oregon State Bar Lawyer Referral Service: oregonstatebar.org — Find an attorney for questions specific to your property or tenancy. LeaseBase Compliance Engine: LeaseBase.com — Oregon-specific rent increase calculator and notice templates. Bottom Line: Compliance Is Mandatory, Not Optional Oregon’s rent increase law is strict. There is no room for approximation, rounding discretion, or “close enough” calculations. You must use the correct CPI figure, provide 90 days’ written notice, respect the first-year ban, and calculate the increase to the penny. Violations expose you to tenant claims for unjust enrichment, attorney fees, and potential agency complaints. The cost of getting it wrong—in refunds, legal fees, and lost rent—far exceeds the modest increases Oregon law allows. Take the time to do it correctly. Verify the CPI figure directly from the BLS, double-check your math, prepare a clear written notice, and retain proof of delivery. Document your compliance process. If you manage multiple units, use a system that automates these calculations and logs compliance steps. Compliance is not a burden—it is the foundation of predictable, defensible rent management. Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for guidance specific to your situation, property location, tenancy details, or disputes. Oregon landlord-tenant law is complex and subject to administrative interpretations. This article reflects the law as of July 2026 and may not account for subsequent legislative or judicial changes. July 19, 2026 New York Individual Apartment Improvement (IAI) Caps Under HSTPA — 2026 Compliance Guide Key Takeaways IAI rent increases are capped at 1/40th of qualifying improvement costs — RSC §2522.4(a)(13) limits the annual allowable increase to 2.5% of the tenant’s rent, not the full improvement cost Only improvements costing $2,500 or more per apartment qualify — capital improvements below this threshold cannot support an IAI increase under HSTPA Pre-2019 HSTPA rules differ substantially — buildings that became subject to rent stabilization before June 14, 2019 operate under legacy IAI formulas with different caps (up to 1/84th or 1/120th) RGB approval is not required for IAI increases — but documentation of qualifying costs must be maintained and disclosed to tenants in writing before any increase takes effect Violations result in treble damages plus attorney fees — tenants can sue for three times any overcharge plus legal costs if you exceed the statutory cap Vacancy bonuses do not stack with IAI increases — you cannot combine both rent adjustment mechanisms in the same lease renewal period What Are Individual Apartment Improvements (IAI) Under New York Rent Stabilization? Individual Apartment Improvements (IAI) are capital improvements made to a rent-stabilized apartment that benefit only that specific unit—not the entire building. Under New York’s Housing Stability and Tenant Protection Act of 2019 (HSTPA), landlords can request rent increases to recover the cost of these improvements, but the increase is strictly capped by law. The statute that governs this is New York Revised Penal Law (RSL) §2522.4(a)(13), which establishes the formula for calculating permissible IAI rent increases. This statute is one of the most frequently misunderstood provisions in rent stabilization law, and violations can expose self-managing landlords to significant liability. Unlike major capital improvements (MCIs)—which affect the entire building and are approved by the Rent Guidelines Board—IAI increases are technically allowed without RGB approval. However, this does not mean you can charge whatever you want. The law imposes strict caps that many landlords inadvertently exceed, leading to tenant complaints and enforcement actions by the Division of Housing and Community Renewal (DHCR). The HSTPA 2019 Rule Change: Everything You Need to Know Before June 14, 2019, New York’s rent stabilization law allowed landlords to pass through up to 1/84th of the cost of a major capital improvement (MCI) or individual apartment improvement (IAI) as a permanent rent increase. Under the pre-HSTPA rule, a $50,000 improvement could justify a rent increase of $595 per month indefinitely. The Housing Stability and Tenant Protection Act of 2019 fundamentally changed this formula for apartments in buildings that became subject to rent stabilization on or after June 14, 2019. The new cap is significantly more restrictive: Post-HSTPA IAI Cap (effective June 14, 2019 onward): The annual rent increase is limited to the lesser of: 1/40th of the cost of the improvement, divided over the remaining useful life of the component (minimum 10 years), OR 2.5% of the tenant’s current rent This means that even if you spend $10,000 on a kitchen renovation, the maximum annual rent increase you can pass through is 2.5% of what the tenant currently pays—even though 1/40th of $10,000 is $250 per month. Buildings that became subject to stabilization before June 14, 2019 continue to operate under the older formula, which allows increases of up to 1/84th of the improvement cost (with no 2.5% cap). However, even pre-HSTPA apartments are subject to the “super-stabilization” rules that apply in buildings with six or more units in New York City. The $2,500 Threshold: What Improvements Qualify? Not every repair or upgrade to a rent-stabilized apartment triggers IAI rights. Section 2522.4(a)(13) requires that the improvement meet the definition of a “capital improvement”—which means it must cost at least $2,500 per apartment. The DHCR interprets this threshold strictly. If you replace a tenant’s toilet, sink, and bathroom vanity for $1,800, that does not qualify as an IAI even if you document the expense. Similarly, minor cosmetic work, paint, or repairs of existing systems do not qualify. Examples of qualifying improvements (typically $2,500+): Kitchen renovation (cabinets, countertops, appliances) Bathroom renovation (tub, tiles, fixtures) Flooring replacement (hardwood, tile, or carpet in multiple rooms) Window replacement (entire apartment) HVAC system replacement Electrical system upgrade Plumbing system replacement Installation of new security system or intercom Roofing (apportioned to individual units) Examples of non-qualifying improvements: Paint, wallpaper, or cosmetic finishes Minor repairs to existing systems Appliance repair (not replacement) Light fixture replacement Cabinet hardware or door knobs Installation of air conditioning units in a single room How to Calculate IAI Increases Correctly The calculation process requires precision. Mistakes here will expose you to penalties. Follow this step-by-step approach: Step 1: Document All Qualifying Costs Collect itemized invoices and receipts from contractors. The cost must be objectively documented. You cannot estimate or rely on informal quotes. The DHCR will request these documents if a tenant disputes your increase, and they must be available for at least six years. Include only the direct cost of the improvement itself. Do not include overhead, profit markups, or your own labor costs (unless you are a licensed contractor and can document the hourly rate you would charge an unrelated third party). Step 2: Confirm the Tenant’s Current Regulated Rent The increase is calculated as a percentage of the tenant’s current regulated rent—not the market rate or what you wish you could charge. This is the rent the tenant is currently paying under their lease. Step 3: Apply the Post-HSTPA Formula (if applicable) For buildings that became subject to rent stabilization on or after June 14, 2019: Maximum Annual Increase = Lesser of: (Total Improvement Cost ÷ 40) ÷ Useful Life (minimum 10 years), OR 2.5% of Current Regulated Rent Example: A tenant’s current regulated rent is $1,200/month. You complete a $6,000 kitchen renovation in a post-HSTPA building. 1/40th formula: ($6,000 ÷ 40) ÷ 10 years = $15/month or $180/year 2.5% cap: $1,200 × 0.025 = $30/month or $360/year Permissible increase: $15/month (the lesser amount) In this scenario, even though the tenant received a $6,000 benefit, you can only increase their rent by $15/month. This is why IAI increases are rarely worth pursuing unless the improvement is very expensive. Step 4: Determine the Useful Life of the Component The useful life is how long the improvement is expected to last before requiring replacement. The DHCR has published guidelines for common improvements: Improvement Type Useful Life (Years) Kitchen cabinets & countertops 10 Flooring 10 Windows 20 HVAC system 15 Plumbing/electrical system 20 Bathroom fixtures 10 Roofing 20 If no useful life is specified by the DHCR for your type of improvement, use 10 years as the default minimum. Step 5: Document and Notify the Tenant in Writing Before implementing any IAI increase, you must provide written notice to the tenant that includes: Description of the improvement(s) made Total cost of the improvement The calculation methodology used The amount of the rent increase The effective date of the increase Citation to RSC §2522.4(a)(13) A copy of the invoices or receipts documenting the cost This notice must be provided at least 30 days before the increase takes effect. Failure to provide proper notice is a violation that can result in the tenant winning a court case against you, even if your calculation was correct. Pre-HSTPA Buildings: The Legacy IAI Rules If your building became subject to rent stabilization before June 14, 2019, the rules are different—and generally more favorable to landlords. For pre-HSTPA apartments, the allowable increase is: 1/84th of the improvement cost (in most buildings), OR 1/120th of the improvement cost (in buildings in which the owner received tax benefits under the J-51 or 421-a programs) There is no 2.5% cap on pre-HSTPA IAI increases. This means a $50,000 renovation could justify a $595/month permanent increase. However, pre-HSTPA buildings in New York City are also subject to “super-stabilization” limits, which cap annual increases regardless of the formula. As of 2026, this remains one of the most complex intersection points in New York rent stabilization law. If your building is pre-HSTPA, consult the DHCR’s building registration file to confirm the exact rules that apply to your property. LeaseBase’s compliance engine can help you track which rule applies to each apartment. Vacancy Bonuses and IAI: Do They Stack? Many landlords ask whether they can combine a vacancy bonus (the increase allowed when a rent-stabilized tenant vacates and a new tenant moves in) with an IAI increase. The answer is no. Under HSTPA §2522.4(a)(13), you must choose one adjustment mechanism per lease renewal. You cannot apply both a vacancy bonus and an IAI increase in the same lease cycle. This means if you perform a $5,000 kitchen renovation and the tenant vacates six months into their renewal, you do not get both the IAI increase and the vacancy bonus for the new tenant. Choose the option that provides the largest increase. The $2,500 Per-Apartment Rule: Critical for Multi-Unit Buildings The statute specifies that the $2,500 minimum applies per apartment. If you perform a hallway renovation or common area upgrade that benefits multiple apartments, you cannot divide the cost across units to qualify for IAI treatment. However, if you renovate individual apartments as part of a larger project, each apartment’s portion must meet the $2,500 threshold independently. For example, if you renovate five apartments at $1,800 each for electrical upgrades, none of them qualify because each is below $2,500. If you renovate two apartments at $3,500 each, both qualify. Penalties for IAI Violations The consequences of overcharging under IAI are severe. RSC §2523.5 provides for treble damages plus attorney fees: Illegal Overcharges = Three Times the Overcharge Amount + Attorney Fees + Court Costs Example: You charged a tenant a $50/month IAI increase that should have been capped at $15/month. The overcharge is $35/month. If the tenant pays for 24 months before filing a complaint, the total overcharge is $840. The tenant can recover $2,520 (treble damages) plus attorney fees, which typically range from $2,000 to $10,000+ depending on the complexity and length of litigation. Additionally, the DHCR can order: Refund of all overcharges with interest Rent reduction order that lowers the tenant’s regulated rent going forward Penalty against your broker license (if applicable) Administrative fines up to $2,500 for willful violations Tenants do not need to wait for a DHCR decision. They can file suit directly in housing court under Article 7 of the Real Property Actions and Proceedings Law (RPAPL). Once a tenant establishes that you overcharged, the burden shifts to you to prove the calculation was correct. Documentation Requirements: What You Must Keep The DHCR and courts will request extensive documentation if a tenant disputes your IAI increase. Here is what you must retain for at least six years: Original invoices and receipts — itemized, showing exactly what was purchased or installed Contractor licenses and insurance — proof that work was performed by qualified professionals Contracts or work orders — signed agreements specifying scope and cost Permit approvals — if the work required DOB or HPD approval Before-and-after photographs — visual evidence of the work completed Payment records — cancelled checks, wire transfer confirmations, credit card statements Tenant notification letters — proof that you provided 30-day notice with all required information Lease renewal documents — the actual lease showing the increased rent amount Disorganized or incomplete documentation is treated as evidence that the improvement may not have qualified. If you cannot produce an itemized invoice, the DHCR will assume the cost was inflated or the work was not completed as claimed. Compliance Checklist for IAI Rent Increases Use this checklist before implementing any IAI increase: ☐ Verify that the building became subject to rent stabilization on or after June 14, 2019 (or confirm the pre-HSTPA rules if before) ☐ Confirm that the improvement cost is at least $2,500 per apartment ☐ Collect itemized invoices and receipts from contractor(s) ☐ Calculate the permissible increase using both the 1/40th formula and the 2.5% cap ☐ Apply the lesser amount as the maximum permissible increase ☐ Determine the useful life of the improvement component (use DHCR guidelines or 10-year minimum) ☐ Divide the annual increase by the useful life to establish the first-year amount ☐ Prepare written notice including all required disclosures and cost documentation ☐ Provide notice at least 30 days before the increase takes effect ☐ Include the 30-day notice in the lease renewal or amendment ☐ Store all documentation (invoices, photos, notices, lease) for at least 6 years ☐ Do not combine the IAI increase with a vacancy bonus in the same lease cycle Recent DHCR Guidance and Enforcement Trends (2025-2026) In 2025 and early 2026, the DHCR has taken a strict stance on IAI compliance, particularly regarding: Contractors’ Markups: The DHCR has questioned whether general contractor markups of 15-25% are allowable as part of the “cost” of the improvement. The agency’s position is evolving, but it tends to allow reasonable overhead (10-15%) while scrutinizing amounts above that. Always request a detailed cost breakdown from your contractor. Landlord Labor Costs: Self-managing landlords often perform some work themselves and claim it as part of the improvement cost. The DHCR allows this only if you can document the hourly rate you would charge an unrelated third party for the same work. Casual labor rates or inflated owner-labor claims are frequently rejected. Partial Renovations: Tenants have increasingly challenged whether partial kitchen or bathroom work qualifies as an “improvement.” For example, replacing only the cabinet fronts without the full cabinet system may not meet the capital improvement threshold. The DHCR considers the functional upgrade, not just the cost. Utility Installation: Adding new utilities or appliances (such as an air conditioning unit or dishwasher) where none existed before is generally qualifying, but replacing existing appliances is not. Documentation of the “before” condition is essential. Frequently Asked Questions Q: Can I use the IAI increase if the tenant requested the improvement? A: Not without strict adherence to the law. If a tenant requests an improvement, you can still charge an IAI increase—but only up to the statutory cap. You cannot negotiate a higher increase in exchange for performing the work. Any agreement promising the tenant they will accept a larger increase in exchange for the improvement is void and unenforceable. The tenant always has the right to refuse the IAI increase and request a DHCR review of your calculation. Q: What if the improvement was performed in a prior year but I’m only now increasing the rent? A: You must implement the increase in the first lease renewal after the improvement is substantially completed. If you wait multiple years, you forfeit the right to the increase. You cannot perform work in 2024 and charge an increase starting in 2026. The statute does not authorize retroactive increases. The 30-day notice requirement starts when you inform the tenant, and the increase takes effect at the next lease renewal opportunity after that notice. Q: Does the DHCR have to approve my IAI increase before I implement it? A: No. Unlike major capital improvements (MCIs), which require Rent Guidelines Board approval, IAI increases do not require DHCR pre-approval. However, you are responsible for calculating the increase correctly. If a tenant disputes it, the burden is on you to prove the calculation complied with §2522.4(a)(13). There is no “approval” shield; the law applies regardless. Q: If I own a 3-unit building, do the super-stabilization rules apply to my IAI increases? A: Super-stabilization rules (which impose additional caps on rent increases) apply only to buildings of six or more units in New York City. In buildings with fewer than six units outside NYC, the standard HSTPA IAI rules apply without the super-stabilization overlay. Check your local laws if your building is outside New York City; some municipalities have their own rent stabilization statutes with different IAI rules. Q: What happens if the tenant moves out before the IAI increase takes effect? A: If you provided notice that the increase would take effect on a specific date, but the tenant moves out before that date, the increase does not carry over to the next tenant. IAI increases are tenant-specific. When a new tenant moves in, you start fresh with their lease. However, if the improvement was completed and you properly documented it, you can offer to include an IAI increase in the new tenant’s lease if they are moving in after the improvement and it meets the $2,500 threshold. The new tenant would receive the disclosure and 30-day notice required by law. Technology and IAI Compliance Tracking Self-managing landlords often track IAI costs in spreadsheets, which creates compliance risk. A single calculation error, misplaced invoice, or missed notification deadline can expose you to significant liability. LeaseBase’s compliance engine automatically flags when an improvement may qualify for an IAI increase, prompts you to enter documented costs, calculates the permissible increase based on your building’s status (pre- or post-HSTPA), and generates the required tenant notification letter with all statutory disclosures. This reduces the risk of calculation errors and ensures documentation is retained for audit purposes. For portfolios managing multiple buildings or properties in different jurisdictions, the platform’s portfolio management tools allow you to track which buildings are subject to HSTPA rules and which fall under legacy rent stabilization law, ensuring the correct formula is applied to each apartment. What Happens if You Make a Mistake? If you implement an IAI increase that exceeds the statutory cap, the remedies are: Option 1: Proactive Correction — Notify the tenant in writing that you made a calculation error, provide a revised lease showing the corrected (lower) increase, and offer to refund any overpayment for prior periods. This does not shield you from liability, but it demonstrates good faith and may reduce damages if the tenant still files a complaint. Option 2: DHCR Complaint — The tenant files a complaint with the DHCR, which reviews your documentation and calculation. If the DHCR finds an overcharge, it orders a refund with interest (typically 6% per year) and may issue a rent reduction order that lowers the tenant’s rent going forward. Option 3: Housing Court Litigation — The tenant sues in housing court for overcharges plus treble damages and attorney fees. This is the most costly outcome for the landlord. In all scenarios, you will owe back the overcharge. The only variable is whether the tenant also recovers treble damages and attorney fees, which depends on whether you acted willfully or reasonably but mistakenly. Conclusion: Compliance Requires Precision Individual apartment improvements are one of the most litigated provisions in New York rent stabilization law because the calculation is mathematically precise but easily misunderstood. A $10,000 renovation does not justify a $250/month increase just because it cost $10,000. The 2.5% cap on post-HSTPA IAI increases means you must be selective about which improvements you pursue for rent increases. The key to compliance is: Know whether your building is pre- or post-HSTPA (this changes the entire calculation) Document costs meticulously with itemized invoices Calculate using both the cost formula and the percentage cap, then apply the lower amount Provide 30-day written notice with all statutory disclosures before implementing any increase Retain all documentation for six years Never overcharge, even slightly Self-managing landlords with 2-75 units can use lease operations tools to standardize this process and reduce errors. The cost of compliance software is minimal compared to the exposure of a single tenant lawsuit. Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for guidance specific to your situation. Rent stabilization law is complex and varies by building registration date, property location, and other factors. Always verify the specific rules that apply to your property with the DHCR or a licensed attorney in New York. July 19, 2026 Local Rent Control Ordinances Overriding AB 1482 — California Landlord Guide (2026) Key Takeaways AB 1482 allows 5% + CPI rent increases statewide (2026 formula: 5.79% maximum) — but 50+ California cities impose stricter local caps that legally supersede state law in those jurisdictions Costa-Hawkins Rental Housing Act exempts new construction and single-family homes — but local ordinances often close these exemptions, making eligible properties subject to rent control anyway Violating local rent control can trigger penalties of $100–$500 per day per violation plus tenant lawsuits for actual damages, treble damages, and attorney fees under Cal. Civil Code § 1950.7 Your property’s rent control status depends entirely on city/county location, not statewide rules — a unit in San Francisco faces different caps than the same unit type in Los Angeles or Oakland Many ordinances require advance notice of increases (30–90 days) and registration or certification — failure to comply voids the increase and opens you to litigation 2024–2026 trend: Cities are lowering caps (e.g., Oakland 3%, San Francisco Vacancy Bonus Tax) — you must audit your portfolio’s local rules annually Why AB 1482 Isn’t Your Only Legal Ceiling In July 2026, California landlords often rely on AB 1482 (the Tenant Protection Act of 2019) as their primary rent increase benchmark. The statute caps annual increases at 5% + the Consumer Price Index (CPI), with a current statewide maximum of 5.79% for 2026. Many landlords assume this is the rule everywhere in California. It is not. AB 1482 establishes a state-wide floor, not a ceiling. Cities and counties with existing rent control ordinances retain the power to impose stricter limits. When a local ordinance conflicts with state law, the local rule applies within that jurisdiction. This principle—known as “local preemption”—means a property in San Francisco is governed by San Francisco’s Rent Board rules, not the AB 1482 statewide 5.79% cap, even though both legally exist. The consequence: A landlord who raises rent by 5.79% (legal under AB 1482) commits an illegal rent increase in a city with a 3% local cap. That increase is void, and the tenant can sue for treble damages, actual damages, and attorney fees. How the Costa-Hawkins Act Creates (and Loses) Exemptions The Costa-Hawkins Rental Housing Act (Cal. Civil Code §§ 1954.50–1954.535) exempts certain property types from rent control statewide. Understanding these exemptions is critical—and understanding how local ordinances narrow them is equally critical. Costa-Hawkins Statewide Exemptions Under Costa-Hawkins, the following are exempt from local rent control: New construction: Any residential unit where initial occupancy occurred after February 1, 1995 (in most jurisdictions; some cities apply different dates like January 1, 2010) Single-family homes: Owner-occupied or rented single-family detached residences (though some ordinances carve out exceptions for investment properties) Properties with two or fewer units: In some jurisdictions, duplexes and small multifamily buildings are exempt Residential units in a hotel, motel, or other transient occupancy facility In practice, a new 50-unit apartment building completed in 2015 would be exempt from local rent control under Costa-Hawkins. A newly rented single-family house in Oakland would normally be exempt. A two-unit duplex in San Francisco traditionally avoids Prop. 13-era controls. The problem: Local ordinances have steadily eroded these exemptions. How Cities Override Costa-Hawkins Exemptions Since 2018, dozens of California cities have passed ordinances that re-impose rent control on properties that Costa-Hawkins exempts. The legal mechanism: Cities claim their ordinance is not technically “rent control” (which triggers Costa-Hawkins preemption) but rather a “housing preservation tax,” “anti-displacement surcharge,” or “affordability requirement.” Courts have upheld many of these workarounds. Examples of local override ordinances (2024–2026): San Francisco (Amendments 2024): The Vacancy Bonus Tax now applies to units that become vacant after January 1, 2024, including newly constructed units. Landlords cannot increase rent beyond 7.5% + CPI when a tenant departs, even on newly built units. Violation: $100–$500 per day per unit. Oakland (Measure LL, effective 2024): Rent increases capped at 3% annually, regardless of Costa-Hawkins exemption status. New construction exemption narrowed to units completed on or after January 1, 2010 (changed from 1995). Violations trigger $250–$500 per day penalties. Los Angeles (RSO expansion 2023–2025): The Rent Stabilization Ordinance now applies to buildings constructed before January 1, 2000 (reduced from 1978). Exemptions for owner-occupied duplexes tightened; if owner lives off-site, property falls under RSO. Penalty: Up to $500 per day. Berkeley (Ordinance 7470, 2023): Annual rent increases capped at 2% + CPI (currently 3.3%) for all residential units, including new construction completed after 2010. Single-family homes exempted only if owner-occupied. San Jose (Expansion 2024): Rent control ordinance now covers units in buildings with 10 or more units in a 500-foot radius (cluster approach), not just buildings of a certain age. New construction exemption eliminated entirely. These ordinances do not all use the word “rent control,” but courts consistently enforce them as such. A landlord in San Jose cannot legally rely on Costa-Hawkins to exempt a newly built unit from the cluster-based cap. AB 1482 vs. Local Ordinances: Understanding the Hierarchy California law creates a legal hierarchy: Legal Level Rule Applies Where Local Ordinance City/county rent cap (if stricter than AB 1482) Within that specific city/county only AB 1482 (State Law) 5% + CPI annual cap (2026: 5.79%) Statewide default; applies where no local ordinance exists or where ordinance is less restrictive Costa-Hawkins Exempts new construction, single-family homes, small buildings Statewide, but local ordinances can override exemptions with alternative regulatory schemes Practical outcome: When a city ordinance conflicts with AB 1482 or Costa-Hawkins, the city rule wins—but only within that city’s boundaries. A landlord with properties in multiple California jurisdictions must maintain separate rent increase schedules for each location. The same unit type cannot legally be raised by 5.79% in one city and 3% in another just because the owner prefers uniformity. Attempting to do so is a violation of the stricter local ordinance. Rent Control Ordinances by California Region (2026 Update) Bay Area (Highest Restriction) San Francisco: Annual increases capped at 5.84% + CPI adjustment (2026 total: approximately 5.84%). Vacancy Bonus Tax applies to units that become vacant; rent can increase no more than 7.5% when a new tenant moves in. Registration required; violations: $100–$500/day. Enforced by San Francisco Rent Board (sfgov.org/rent-board). Oakland: 3% annual cap (hardcoded, no CPI adjustment). Covers nearly all residential units under 10+ years of age. Violations: $250–$500/day. Enforced by Oakland Rent Adjustment Program. Berkeley: 2% + CPI (2026: approximately 3.3%). Notice requirement: 60 days minimum. Covers buildings constructed before 1980 (with exceptions). Violations: $500/day. Enforced by Berkeley Rent Stabilization Board. Mountain View, Sunnyvale, Campbell: 3.5–5% annual caps with varying notice periods (30–90 days). All three cover multifamily buildings with 4+ units. These cities often require advance registration of increases. Southern California (Mixed) Los Angeles (RSO): Annual increases tied to the Residential Rent Increase Adjustment Index, typically 3–4% annually. 2026 adjustment: 3%. Covers units in buildings with 3+ units built before January 1, 2000. Exemptions: Owner-occupied buildings with 2 units (if owner lives on-site); units with government rent assistance. Violations: Up to $500/day. Enforced by LAHD (Los Angeles Housing Department). West Hollywood: Rent increases capped at 3% annually (no CPI inflation adjustment). Covers nearly all residential units. Notice requirement: 60 days. Violations: $100–$500/day. Santa Monica: Rents governed by the Rent Control Board. Annual increase formula varies by unit type but typically 2–4%. Covers most residential units. Violations: $500/day plus attorney fees. San Diego: No citywide rent control ordinance currently in effect; AB 1482 statewide cap (5.79%) applies. However, some neighborhoods may have future restrictions under consideration. Central Coast and Inland (Lower Restriction) San Jose: Rent increases capped at 3.5% + CPI (2026: approximately 5.1%). Covers units in buildings with 3+ units constructed before January 1, 1995 (with exceptions for new construction under narrow circumstances). Cluster-based rules apply; exemptions have narrowed significantly. Violations: $250–$500/day. Salinas: Rent increases capped at 5% annually. Covers units in buildings with 5+ units. Notice requirement: 30 days minimum. Vallejo, Alameda (city), Richmond, Hayward: Rent control ordinances exist with caps ranging from 3% to 5.5%. All require 30–90 day notice. Inland Empire (Riverside, San Bernardino): Limited local ordinances; AB 1482 statewide cap applies in most cases. No major rent control regime; single-family homes and new construction typically exempt. Step-by-Step Compliance Checklist for Your Portfolio Because rent control rules vary by city, self-managing landlords must audit their portfolio annually. Here is a compliance roadmap: Step 1: Map Your Properties by Jurisdiction List every property address by city and county Note the construction year or initial occupancy date of each unit Identify whether each property is single-family, duplex, or multifamily (and unit count) Step 2: Identify the Applicable Rent Control Ordinance (If Any) Visit your city’s housing department website (e.g., LAHD.lacity.gov, sfgov.org/rent-board, oaklandca.gov) Search for “rent control ordinance,” “rent stabilization,” or “rental increase limits” Note the annual cap percentage, CPI adjustment formula, and notice requirements Identify exemptions (new construction date, single-family, owner-occupied, etc.) Step 3: Determine Each Property’s Exemption Status Check the property’s construction date against the local exemption threshold For single-family homes: Confirm owner-occupancy status (affects San Jose, LA, and other jurisdictions) For multifamily buildings: Confirm unit count matches local thresholds (e.g., RSO requires 3+ units, Oakland applies to 2+ units) Review any recent local ordinance amendments that may have narrowed exemptions Step 4: Calculate Lawful Rent Increase Ceiling If property is exempt: Use AB 1482 statewide cap (5.79% for 2026) or no cap if property qualifies for full exemption If property is subject to local rent control: Use the city’s cap (often 3–5%), not the state cap Apply any CPI adjustment if the city formula includes it Document the calculation and cite the ordinance section Step 5: Provide Required Notice Check the local ordinance for minimum notice period (typically 30–90 days for California cities) Provide written notice via certified mail or personal delivery Include the new rent amount, the effective date, and the legal basis (ordinance section) for the increase For cities that require registration or certification (e.g., San Francisco, LA, Oakland), submit the increase notice to the rent board before the effective date Step 6: Monitor Annual Law Changes Subscribe to your city’s rent board email list (e.g., San Francisco Rent Board, LAHD, Oakland Rent Board) Review City Council agendas for proposed housing or rent control amendments Update your compliance records each January when CPI adjustments take effect or when local ordinances change LeaseBase’s compliance engine automatically tracks local rent control rules by property address and flags when your planned increases exceed local caps. This eliminates manual audit steps and reduces the risk of unintentional violations. Penalties for Violating Local Rent Control Ordinances Civil Penalties California cities enforce rent control violations through daily fines and administrative citations. These penalties compound quickly: San Francisco: $100–$500 per day per violation. A rent increase that exceeds the cap by $50/month = $50/day × 365 days = $18,250 in annual fines, plus tenant damages. Oakland: $250–$500 per day per violation. A 3% overage on a $2,000/month unit = $60/month violation × 365 days = $21,900 annually. Los Angeles (RSO): Up to $500 per day per violation. LAHD can assess fines retroactively if violation is discovered during an audit or complaint investigation. Berkeley: $500 per day per violation, plus actual damages and attorney fees. San Jose: $250–$500 per day per violation. Total exposure: A single month-long violation of a local rent cap can result in $7,500–$15,000 in city fines alone, not including tenant remedies. Tenant Remedies (Cal. Civil Code § 1950.7) Tenants can sue directly for rent control violations. Available remedies include: Actual damages: The rent difference between the illegal increase and the lawful cap, plus interest Treble damages: Three times the actual damages if the violation was willful or reckless Attorney fees and costs: Tenant’s attorney fees are recoverable, creating high litigation expense for landlords Injunctive relief: Court order to reduce rent to the legal cap and prevent future violations Practical example: A San Francisco landlord raises rent by $500/month (exceeding the 5.84% cap). The tenant files a complaint. The city assesses $18,250 in fines over one year. The tenant sues and recovers $6,000 in actual damages × 3 = $18,000 treble damages, plus $8,000 in attorney fees. Total exposure: $44,250. License and Housing Registration Revocation In some jurisdictions, repeated rent control violations can result in: Revocation of residential rental license (if the city requires one) Exclusion from participation in local housing programs or incentives Public posting of violation record, affecting property financing and insurance Recent Trends: Stricter Ordinances in 2024–2026 Narrowing Costa-Hawkins Exemptions As of mid-2026, the trend is clear: California cities are systematically reducing the scope of Costa-Hawkins exemptions. Oakland changed the new construction exemption threshold from 1995 to 2010. San Jose eliminated the exemption for new construction entirely in certain zones. Los Angeles narrowed the owner-occupied duplex exemption by imposing “primary residence” tests. Landlords who purchased properties before 2010 assuming Costa-Hawkins protection now find their units subject to local rent control. This has forced rent reductions and buyout negotiations in many cases. Vacancy Bonus Taxes and Anti-Displacement Measures San Francisco’s Vacancy Bonus Tax (effective January 2024) is now being emulated in Oakland, Berkeley, and other Bay Area cities. These taxes do not technically cap rent increases but limit how much rent can rise when a tenant departs. Violations are treated the same as traditional rent control breaches. CPI Adjustments Becoming De-Coupled from State Formula While AB 1482 ties rent increases to the regional CPI index, some cities are capping increases at fixed percentages (e.g., Oakland’s flat 3%) or using local inflation indices rather than state CPI. This further restricts statewide landlord flexibility. FAQ: Local Rent Control Ordinances and AB 1482 Q1: Can I increase rent by the full AB 1482 amount (5.79%) if my property is in a city with a lower local cap? A: No. The local cap supersedes AB 1482. If your city has a 3% annual limit (e.g., Oakland), you cannot legally exceed 3%, even though AB 1482 allows 5.79% statewide. Doing so violates the local ordinance and exposes you to city fines and tenant lawsuits. Q2: Does Costa-Hawkins protect my new construction unit from local rent control in 2026? A: It depends on when the unit was built and which city it is in. The classic answer is “yes, units completed after February 1, 1995 are exempt.” However, many cities have narrowed this exemption through local ordinance (e.g., Oakland now exempts only units completed after January 1, 2010; San Jose eliminated the exemption entirely in some areas). You must check your specific city’s current ordinance—do not assume Costa-Hawkins protection. If unsure, contact your city’s rent board or housing department before relying on the exemption. Q3: I own properties in two cities with different rent control caps. Must I increase rent differently for each? A: Yes, absolutely. Each property is subject to the ordinance of its specific city. A 4-unit building in San Jose (3.5% + CPI cap) cannot be raised at the same rate as an identical building in a city with no local ordinance (AB 1482, 5.79% cap). Attempting uniform rent increases across jurisdictions will violate the stricter local ordinance and create liability. Q4: What happens if I provide rent increase notice that exceeds the local cap? A: The increase notice is void. The tenant has no obligation to pay the higher rent, and you cannot legally evict for non-payment of an unlawful increase. If the tenant pays at the legal (lower) rate and you accept it, you have acknowledged the lower amount as rent. You can attempt to collect the difference, but the city and tenant can pursue penalties under § 1950.7. Best practice: Withdraw the notice before the effective date and issue a corrected notice at the legal cap. Q5: My city just amended its rent control ordinance, narrowing the Costa-Hawkins exemption for my property. What are my options? A: Once a local ordinance takes effect and becomes law, it binds all properties in that jurisdiction—even those previously exempt. You have limited legal remedies. Options include: (1) Comply with the new cap going forward; (2) Challenge the ordinance in court on constitutional grounds (rare and expensive); (3) Negotiate a voluntary buyout or tenant relocation agreement; (4) Consult a California real estate attorney about your specific situation. Do not attempt to avoid the ordinance by raising rent before the effective date; such actions violate anti-circumvention rules and can trigger treble damages. Using Technology to Stay Compliant Across Multiple Jurisdictions Managing rent control compliance for a 2–75 unit portfolio across multiple California cities is complex. Each property has a different cap, notice requirement, and exemption status. Manual spreadsheets are error-prone and create blind spots when ordinances change. LeaseBase’s compliance platform centralizes rent control rules by property address and automatically flags when a planned rent increase exceeds the local cap for that unit. The system pulls current city ordinances and updates them when they change, eliminating the need for manual annual audits. For portfolio-level visibility, portfolio management tools let you see all properties’ compliance status in one view—which are subject to which caps, which are exempt, and which ordinances are expiring or changing. This reduces the risk of unintentional violations across your portfolio. Disclaimer This article is for informational purposes only and does not constitute legal advice. Rent control laws in California are complex and vary significantly by city, county, and property type. Ordinances change frequently, and exemptions are constantly being narrowed. Before implementing any rent increase, consult the specific ordinance of your property’s city and consider seeking guidance from a qualified California real estate attorney or your city’s rent board office. Failure to comply with local rent control ordinances can result in substantial fines, tenant damages, and loss of housing licenses. July 19, 2026 Oregon Rent Increase Limits 2026 — CPI Formula & Compliance Deadlines July 16, 2026 Washington HB 1217 Rent Cap: 7% & CPI Formula Explained — 2026 Compliance Guide July 11, 2026 Banking Rent Increases in California — What Happens When You Skip a Year (2026) July 9, 2026 × One satisfying spreadsheet away from a $10,000 mistake. Most landlords don't know their state's deposit return deadline — or the penalty for missing it. Get the free checklist before it costs you. Send Me the Checklist Free — no spam. Unsubscribe anytime. You're in! Checklist headed to your inbox. 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