Oregon Rent Increase Cap: 7% + CPI Rule Explained for Landlords (2026)

What Is Oregon’s Rent Increase Cap and When Did It Start?

In June 2019, Oregon became the first state in the nation to impose a statewide rent increase cap. Senate Bill 608 (SB 608), codified in Oregon Revised Statutes § 90.323, took effect on January 1, 2020, and fundamentally changed how landlords can raise rent in Oregon.

The law caps annual rent increases at 7% plus the Consumer Price Index. This is not a simple 7% cap—it is a 7% floor plus an inflation adjustment. The CPI used is specifically the “consumer price index for all urban consumers for the Portland-Seattle-Tacoma region” published by the U.S. Bureau of Labor Statistics.

Here’s what this means in practical terms: if CPI for the prior 12 months was 3.2%, your allowable increase is 7% + 3.2% = 10.2%. If CPI was negative (deflation), your allowable increase is still 7% plus that negative number. The cap applies to month-to-month tenancies and lease renewals for all rental units in Oregon.

As of August 2026, landlords continue to operate under this cap. The 2026-2027 allowable increase (effective July 1, 2026) was calculated based on 12-month CPI data through June 2026. This is not optional compliance—it is mandatory for every residential landlord in Oregon managing 2 or more units, and for owner-occupants in certain situations.

How to Calculate Your Legal Rent Increase

The calculation is straightforward but requires you to use the correct CPI figure published at the correct time. Here is the step-by-step process:

Step 1: Identify the Applicable CPI Figure

Oregon law requires use of the Consumer Price Index for all urban consumers (CPI-U), “West region” series, published by the U.S. Bureau of Labor Statistics. The relevant CPI figure is the one published in June of the year your increase takes effect, which reflects the 12-month change ending in May.

For example, if you are raising rent effective July 1, 2026, you use the CPI figure published in June 2026. This data is publicly available at bls.gov and is also published by the Oregon State Bar and landlord associations for ease of reference.

Step 2: Add 7% to the CPI Figure

Take the CPI percentage and add 7 percentage points. If June 2026 CPI-U (West) was 3.1%, your calculation is:

7% + 3.1% = 10.1% maximum allowable increase

Step 3: Apply to Current Rent and Round

Multiply the current rent by the allowable percentage increase. If a tenant is paying $1,500/month and the allowable increase is 10.1%, the new rent is:

$1,500 × 1.101 = $1,651.50 (round to $1,651 or $1,652)

Oregon law allows you to round to the nearest dollar. Courts have held that rounding up slightly is not a violation of the statute, as long as the rounded amount does not exceed the mathematically calculated amount by more than 50 cents.

Step 4: Do Not Exceed the Cap

If you calculate a 10.1% increase is allowable but you want to raise rent less, that is permitted. You cannot raise rent more than the cap. If you propose $1,700 on a $1,500 base rent (13.3% increase), you have violated ORS 90.323 even if your calculation was wrong—the statute is strict liability.

Common Mistake: Some landlords believe they can “bank” unused increases. For instance, if you only raised rent 5% last year when 9% was allowed, you cannot raise rent 13% this year. Each year’s cap is independent. Any increase you do not use is forfeited.

Notice Requirements: The 90-Day Rule

A rent increase, even if it is within the legal cap, is not valid unless you provide proper written notice. Oregon law is extremely strict about this requirement.

Minimum Notice Period

You must deliver written notice to the tenant at least 90 days before the date the increase takes effect. This is codified in ORS 90.323(2). The 90 days is measured from the date the tenant actually receives the notice, not from when you send it.

If you email notice on April 1 and the tenant reads it on April 2, you cannot raise rent effective July 1 (90 days from April 2 is July 1, but you need it to arrive before that). Safest practice: mail or hand-deliver notice at least 95 days before the effective date.

Content of the Notice

The notice must include:

• The amount of the new rent
• The date the increase takes effect
• A statement that the increase does not exceed the legal cap under ORS 90.323
• The calculation showing how you arrived at the increase amount (e.g., “Current rent $1,500 × 10.1% increase = $1,651”)
• A statement of the tenant’s right to terminate the lease without penalty if they do not accept the increase (see below)

Oregon courts have invalidated rent increase notices missing required content. The notice must be in writing—oral notice is ineffective. Email is acceptable if you can prove delivery, but certified mail or hand delivery creates a clear proof trail.

Tenant Right to Terminate

Under ORS 90.323(3), if you raise rent more than 5% in a 12-month period, the tenant has the right to terminate their lease without penalty and without providing additional notice. They do not even need to provide 30 days’ notice—they can simply leave. This right terminates 30 days after they receive the notice.

This means if you raise rent 10% and send proper notice 90 days in advance, the tenant can terminate the lease anytime within 30 days of receiving that notice and move out without liability. You must include a clear statement of this right in your notice.

Practical Impact: Landlords who raise rent by more than 5% should expect tenant turnover. Budget for vacancy, turnover costs, and new tenant screening. If your goal is stable, long-term tenancy, increases above 5% are economically risky.

Exemptions: When the Cap Does Not Apply

The 7% + CPI cap applies to most residential rentals in Oregon, but certain properties and situations are exempt. Understanding these exemptions is critical—if your property qualifies for an exemption, you can raise rent by any amount (within Oregon’s other limits, like prohibition on retaliatory increases).

New Construction Exemption (15-Year Period)

Properties that have not been rented or leased for occupancy before January 1, 2020, are exempt from the rent increase cap for the first 15 years of occupancy. ORS 90.323(4)(a).

This exemption is intended to encourage new construction by allowing market-rate pricing during the initial rental period. Once a building reaches 15 years old (January 1, 2035, for a building first rented in 2020), the cap applies going forward.

Important Clarification: This exemption applies to the building as a whole, not individual units. If one unit in a multi-unit building was rented before 2020, the entire building loses the exemption. Verify rental history carefully before claiming this exemption.

Owner-Occupied Duplex Exemption

A landlord who owns and occupies a duplex (one half) and rents the other half is exempt from the rent increase cap for that rental unit. ORS 90.323(4)(b).

The exemption requires actual occupancy by the owner. If you own a duplex, live in unit A, and rent unit B, you can raise rent on unit B without limitation. However, if you move out or rent both units, the exemption no longer applies.

Subsidized Housing and Low-Income Programs

Housing subsidized by federal, state, or local governments (such as Section 8, public housing, or low-income tax credit properties) may have exemptions or different rules under the programs that subsidize them. ORS 90.323(4)(c) defers to federal and state subsidy program rules.

Verify with your subsidy program administrator whether the 7% + CPI cap applies or whether program rules override state law.

Manufactured Dwelling Parks: Different Rules

Manufactured dwelling parks (mobile home parks) in Oregon have their own rent increase rules under ORS 90.505. The cap is generally the same (7% + CPI), but notice requirements differ slightly. Consult those statutes if you own a manufactured dwelling park.

Common Compliance Mistakes and Penalties

Violations of ORS 90.323 carry serious financial consequences. Courts treat rent increase violations as intentional breaches triggering statutory damages, not innocent mistakes.

Mistake #1: Calculating or Applying the Wrong CPI

Some landlords use the wrong CPI series (e.g., national instead of West region) or use stale data. If you calculate a 9% increase but the cap is 8%, you have violated the law. The tenant did not have to sign a new lease; the law adjusts it automatically.

Penalty: Actual damages (the overcharge) plus civil penalties of up to $200 per day, attorney fees, and costs. On a $1,500/month overage, a 3-month violation could result in $1,500 in overcharges plus $18,000 in statutory penalties ($200/day × 90 days) plus attorney fees. Total liability: $19,500+.

Mistake #2: Failing to Provide 90-Day Notice

If you provide 60 days’ notice instead of 90, the increase is void. The tenant can refuse to pay the higher amount, and you cannot evict for non-payment of an unlawful increase.

Penalty: The increase is invalid, tenant owes only the prior rent amount, and you may face damages and attorney fees if the tenant sues.

Mistake #3: Not Including Required Statements in Notice

Oregon courts have voided rent increases when the notice failed to include a calculation showing the increase was within the legal cap or when it failed to inform the tenant of their termination right.

Penalty: The increase may be unenforceable; tenant can withhold the increase amount and you cannot evict.

Mistake #4: Retaliatory Increases

Even if you stay within the 7% + CPI cap, raising rent within 6 months of a tenant exercising a legal right (like requesting repairs, calling code enforcement, or joining a tenant organization) is presumed retaliatory under ORS 90.385. The burden shifts to you to prove the increase was not retaliatory.

Penalty: Damages, attorney fees, and the increase may be voided.

Mistake #5: Compound Increases Within a 12-Month Period

Raising rent twice in one year (e.g., $1,500 → $1,575 in month 3, then $1,575 → $1,650 in month 9) is lawful only if both increases combined do not exceed 7% + CPI. If the combined increases exceed the cap, the second increase violates the law.

Penalty: The second increase is void; statutory damages and overcharge recovery apply.

Enforcement and Penalties: What Happens If You Violate ORS 90.323

Oregon law provides multiple enforcement mechanisms, and tenants have strong incentives to challenge unlawful increases.

Civil Action by the Tenant

A tenant can sue under ORS 90.323(5) for:

• Actual damages (the overcharge amount)
• Statutory civil penalties of up to $200 per day of violation
• Attorney fees and court costs
• In cases of willful violations, punitive damages

The tenant does not need to prove harm—the violation itself triggers statutory damages. If you overcharge $50/month for 12 months ($600 total) and get sued, you could owe $600 in actual damages plus up to $2,400 in statutory penalties (assuming $200/day × 12 days the case was active in court) plus attorney fees potentially exceeding $2,000. Total exposure: $5,000+.

Defense Available: Good Faith Error

Oregon law provides a narrow defense if you made a genuine, documented good faith error in calculating CPI or in applying the increase. The defense requires:

• You consulted a reliable source for CPI (e.g., the Oregon State Bar or BLS website)
• You applied the calculation consistently
• You corrected the error as soon as you discovered it
• You refunded the overcharge to the tenant

This defense does not apply if you failed to provide proper notice. If notice was deficient, no defense is available.

Agency Enforcement

While Oregon does not have a dedicated rent control enforcement agency, the Oregon Bureau of Labor and Industries (BOLI) can investigate complaints, and the Attorney General’s office can bring enforcement actions in public interest. Additionally, local jurisdictions (Portland, Eugene, Salem) may have additional rent control or rental housing provisions that layer on top of state law.

Documenting Compliance: What to Keep on File

To defend yourself if a tenant challenges an increase, maintain detailed records:

Compliance Checklist for Each Rent Increase

• CPI Source Document — Print or screenshot the official BLS or Oregon State Bar CPI figure used in your calculation, dated and labeled
• Calculation Worksheet — Show the math: prior rent × (1 + [0.07 + CPI%]) = new rent. Include rounding explanation if applicable
• Notice of Increase Letter — Signed copy of the notice sent to tenant, including all required statements
• Proof of Delivery — Certified mail receipt, email read receipt, or signed acknowledgment by tenant
• Delivery Date Documentation — Calendar or letter header showing the 90-day lead time before effective date
• Lease Amendment or Lease Renewal — Copy of any lease document reflecting the new rent amount, signed by both parties
• Tenant Acceptance Confirmation — If the tenant began paying the new rent, that is acceptance; keep rent payment records showing the new amount was paid

Store these documents in a centralized lease file for at least 6 years. If a tenant sues or threatens suit, you can quickly produce evidence showing your compliance.

Interaction With Other Oregon Rent Control Laws

ORS 90.323 is Oregon’s primary rent cap statute, but other laws may apply concurrently:

Local Rent Control Ordinances

Portland, Gresham, and some other jurisdictions have enacted local rent control ordinances that may impose stricter caps or longer notice periods than state law. Local rules take precedence. If you own property in Portland, apply Portland’s local rules first; if they conflict with state law, the stricter rule applies.

Retaliatory Rent Increases (ORS 90.385)

Raising rent within 6 months of a tenant requesting repairs, filing a complaint with code enforcement, or organizing a tenant union is presumed retaliatory. Even if the increase is within the 7% + CPI cap, the increase may still be illegal if retaliatory intent is shown.

Essential Services (ORS 90.320)

If your property fails to provide essential services (heat, water, electricity, habitability), the tenant may withhold rent. You cannot raise rent while your property is non-compliant with habitability standards.

Frequently Asked Questions

Q: If I own rental property in Oregon but live out of state, does the 7% + CPI cap apply to me?

A: Yes. ORS 90.323 applies to all residential rental properties in Oregon, regardless of where the landlord resides. If your property is located in Oregon and is rented to tenants, you must comply with the cap. Oregon courts have jurisdiction over non-resident landlords and will enforce the law against them.

Q: Can I raise rent if my mortgage, property taxes, or insurance increased more than the legal cap?

A: No. The law does not provide exceptions for increased operating costs. You must comply with the 7% + CPI cap regardless of your expenses. (This is one reason landlords oppose rent control laws, but it is the law you must follow.) Plan your rental pricing to account for cost increases within the cap.

Q: The tenant moved out mid-lease. Can I raise rent on the next tenant without waiting 12 months?

A: Yes. The 12-month cap resets when a new tenant moves in. However, the notice requirement (90 days for rent increases over 5%) applies to the new tenant. You must send written notice 90 days before the new rent takes effect. If you want the new rent to apply from the first day of tenancy (day 1 of their lease), you must disclose it in the lease they sign—this is not a “rent increase” in the legal sense but rather the initial lease term rent.

Q: I calculated the increase and gave 90 days’ notice, but I used the wrong CPI figure (national instead of West region). Is the increase void?

A: Likely yes. Oregon courts interpret ORS 90.323 strictly. Using the wrong CPI series means your calculated cap was incorrect, and the increase you applied likely exceeded the true lawful cap. This is a violation, and the tenant can sue to recover the overcharge plus statutory penalties. Immediately recalculate using the correct CPI, determine the overcharge, and refund the tenant before they sue.

Q: Can I avoid the rent cap by converting to month-to-month and then raising rent?

A: No. The cap applies to month-to-month tenancies and to lease renewals. It makes no difference whether you give formal notice of a rent increase or attempt to end the month-to-month tenancy and re-rent at a higher rate—the cap applies either way. Oregon courts have closed this loophole.

Best Practices for Rent Increase Compliance

Use this checklist every time you raise rent:

Action	Timeline	Compliance Requirement
Research Current CPI	6 months before increase	Use BLS.gov or Oregon State Bar published figure; verify you are using West region CPI-U series
Calculate Allowable Increase	6 months before increase	7% + (current CPI%) = cap; do not exceed this percentage
Prepare Notice Letter	5 months before increase	Include new rent amount, effective date, calculation, cap compliance statement, and termination right statement
Deliver Notice	At least 95 days before increase effective date	Use certified mail or hand delivery; obtain proof of delivery; email acceptable if read receipt obtained
Document Delivery	Immediately upon sending	File proof of delivery, letter, CPI calculation, and all supporting documents
If Lease Renewal Occurs	Before new lease begins	Ensure new lease document reflects the increased rent; obtain tenant signature; keep signed copy
Monitor Compliance for 12 Months	After increase takes effect	Do not raise rent again within 12 months unless the combined increases stay within cap; retain all payment records

Technology Tools for Compliance Tracking

Managing rent increases manually across multiple units is error-prone. Consider using a compliance management platform that:

• Stores and auto-updates current CPI data
• Calculates the allowable increase for each unit based on local rules
• Generates compliant notice letters with all required statements
• Tracks 90-day delivery deadlines and alerts you before they pass
• Maintains a searchable archive of all rent increase documentation per unit
• Flags potential retaliatory rent increases based on maintenance request dates

A platform like LeaseBase’s lease operations module reduces compliance errors and creates defensible audit trails. For landlords managing 2-75 units, the cost of a compliance tool ($50–200/month) is negligible compared to the cost of a single rent increase violation ($5,000–20,000).

Additionally, rent payment tracking ensures you have clear records of when rent was paid and at what amount, which is critical evidence if a dispute arises.

Recent Changes and 2026 Updates

As of August 2026, Oregon’s 7% + CPI cap remains in force with no pending legislative changes. However, monitor the following:

• Portland and Local Ordinances: Portland and other Oregon cities have proposed stricter local caps. Check your city’s current rent control rules; they may exceed state minimums.
• CPI Adjustments: CPI fluctuates annually. The allowable increase percentage changes every July 1. Stay informed of the June CPI release each year to know the upcoming year’s cap.
• Eviction Moratorium Remnants: Some pandemic-era tenant protections have expired, but new protections may emerge; verify current law before issuing any notice to quit or pay rent.

Conclusion: Compliance as a Competitive Advantage

Oregon’s 7% + CPI rent increase cap is one of the nation’s most prescriptive rent control laws. For self-managing landlords, compliance requires precision: the correct CPI figure, proper calculation, timely written notice with specific language, and meticulous record-keeping.

The cost of non-compliance is high—$200/day in statutory penalties alone, plus overcharge refunds and attorney fees. The cost of compliance is low: one hour per year to research CPI, calculate the allowable increase, and send a letter.

Landlords who master this statute build trust with tenants, avoid costly litigation, and maintain defensible practices. Those who cut corners or guess at calculations face liability that erodes rental income and forces sale of properties at distressed prices.

Start by pulling last year’s rent increase documentation (if any) and verifying that your calculation and notice met these requirements. If errors exist, consult an Oregon landlord-tenant attorney about correction procedures—voluntary refunds and corrected notices often prevent litigation.

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Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a qualified Oregon attorney licensed to practice in your jurisdiction for guidance specific to your situation.