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Since the Oregon Residential Landlord and Tenant Act became law in 1973, Oregon residents have not been allowed to decide which tradeoffs are acceptable when renting an affordable home.
The law expressly forbids tenants from waiving or forgoing any “rights,” including minimum habitability standards, which are minutely delineated. Contrary to the Founders’ belief that rights are inherent to humankind, and that the role of the state is to prevent their infringement, Oregon’s law incorporates the theory that “rights” can be granted to tenants and withdrawn from landlords by force of law. It has more than 100 pages of tenant “protections.” It has just a single section listing tenant responsibilities.
If the law mandated that every rental in the state must have granite countertops and an Olympic-size pool, even our state Legislature might realize that imposing these requirements would price housing out of the reach of our poorer citizens. So why the Legislature, five decades ago, thought it knew better than each Oregonian in every conceivable situation what a prospective tenant was willing to endure to find an affordable rental, can only be answered: It didn’t.
Each mandate increases property owners’ expenses, which must be recouped through higher rents. For example, the mandate that rentals must be “free of vermin at all times” means every rural rental in Oregon lacking a cat or other means of low-cost extermination is either in continual violation, or must incorporate the not inconsequential cost of exterminators in the rent.
Thus, at the margin, each increase in tenant “rights” actually wrongs those low-income renters now priced out of the market. Often, after it is no longer profitable to rent at an affordable rate, “mom and pop” landlords sell out to owner-occupants, thereby reducing the stock of rental housing, or to large corporate purchasers with the savvy and economies of scale to make the numbers work.
Oregon has been profoundly unsuccessful in seeking to solve its self-created problem by pouring tax dollars into “affordable” taxpayer-subsidized housing, banning single family zoning in cities, and wasting hundreds of millions of dollars watching the nonprofit “housing-industrial” complex flail pathetically.
What rational distinction allows Oregonians to be free to eat subsidized junk food, but forbids them by law to decide that they’d rather live with a roof over their heads (even if it’s in a mouse-infested, leaky single-wide), than in a tent?
If I want to grow marijuana commercially, renting a small rural plot with a shack for shelter, Oregon law says that I am smart enough to make my own choices, since my rental is “primarily for agricultural purposes,” and not subject to any of the requirements of the Residential Landlord and Tenant Act. But if I want to rent the identical property and grow for personal consumption, I am forbidden from doing so, since I am now, in the eyes of our state, an instant idiot who lacks the intelligence to decide what’s best for me. Are our farmers really that much savvier than the rest of us?
Given the number of the unhoused who are from marginalized communities, the law’s presumption that tenants are incompetent to make their own housing choices is, if not “systemically” racist, an embarrassing expression of an outdated paternalism.
Oregon could return to pre-1973 rental housing abundance by simply making voluntary a landlord’s participation in the Residential Landlord and Tenant Act. Property owners who “opt out” will immediately save the 10 percent of rental income they now have to pay professional property managers, because the law is so complex that only a professional can navigate its myriad requirements. Rents would instantly be reduced by 10 percent.
As someone who has practiced landlord-tenant law in Oregon since 1970, I would estimate rents are perhaps 20 percent higher because of the law’s complexity and mandates. The fraction of landlords using professional property managers has increased, from perhaps 10 percent in the 1970s to the great majority today.
If the statute required that landlords who choose to opt out make it abundantly clear to prospective tenants that the “protections” of the law do not apply, and the tenant then chooses cheaper rent, why shouldn’t they be free to do so? In return for an affordable rent, they could then negotiate their own habitability and other protections, like any other party to a private contract.
Tenants who feel they need the Residential Landlord and Tenant Act’s current protections can choose to rent from a landlord who doesn’t opt out, just like today. What do we have to lose, again allowing the free market to allocate at least a portion of our scarce rental housing resources, as it so successfully did from 1859 to 1973?
