Oregon Landlords Getting Smacked Around. How are you responding?

Beaverton, OR · Member since 2014 · 118 posts · 119 votes

Maybe I'm just going through a little grumpy fit and being melodramatic, but are any other Oregon landlords, particularly Portland area so far, getting to their breaking point yet of how far you can be pushed by political agenda and rules?

I feel like every other month I'm hearing of more policies of power being taken from landlords, statewide rent control, lack of ability to screen tenants, removing no cause terminations, etc.

What's your tipping point before moving somewhere easier? How do you think this will affect current landlords and also your mentality on buying future rentals?

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Mark Sewell

Investor · Houston, TX · Member since 2017 · 1k+ posts · 871 votes

Grew up an hour north of Portland, and I dearly love it there, so please understand when I say this:

Move to Texas. Everybody else is. We'll leave the light on for ya.

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Steve B.
Engineer · Portland, OR · Member since 2014 · 1k+ posts · 1k+ votes
7y
@Robert M. Isn’t it amazing how per capita tax revenues are going up yet the state needs more money for “basic services.” It’s like we operate in a bizarro state where the fundamental theory of “Economy of scale” works only in reverse
1 Reply
Cameron Riley
Rental Property Investor · Phila, PA · Member since 2018 · 554 posts · 118 votes
7y
@Jason Powell
Why would your tax bill be 250k? Do you own 100s of Portland properties?
Very confused
1 Reply
Matthew McNeil
Rental Property Investor · Boise/Portland · Member since 2017 · 709 posts · 742 votes
7y
Your post is interesting. My parents own a portfolio in Central Oregon (Bend/Redmond) and due to the “political agenda” you mentioned they’re wanting to 1031 their properties over into Idaho. They've reached their “tipping point.”
1 Reply
Robert M.
Investor · Dundee, OR · Member since 2016 · 104 posts · 162 votes
7y
Originally posted by @Matthew McNeil:

Your post is interesting. My parents own a portfolio in Central Oregon (Bend/Redmond) and due to the “political agenda” you mentioned they’re wanting to 1031 their properties over into Idaho. They've reached their “tipping point.”
Idaho IS the new Oregon. I was in Idaho this summer looking for property and could help but notice the vehicle bumper stickers, ''don't Oregonize Idaho''. I thought that was ironic. LOL
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Jason Powell
OP
Beaverton, OR · Member since 2014 · 118 posts · 119 votes
7y
@Cameron Riley I don't own any rental houses, just a small handful of multifamily. The price points up here are much different than where you're at. 15% long term cap gains plus Oregon at 9%. Plus depreciation recapture at 25% fed and 9% state for me. That's someone nobody likes talking about on BP because everyone wants to pretend they will 1031 until they die.
Add the cap gains and depreciation recapture together, and all it takes is a little north of $1m in equity to get taxed 250k when you sell.
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Autumn RankinPro Member
Rental Property Investor · Bandera, TX · Member since 2017 · 148 posts · 56 votes
7y
@Jason Powell I’m so sorry you’re invested there. It’s def not a state that is equal when rules are made. Maybe you can sell out and go to a friendlier state? David Greene did
0 Reply
Nick GiulioniPro Member
Rental Property Investor · Carmel, IN · Member since 2016 · 1k+ posts · 615 votes
7y
Sounds like it might be time to exit the market and find one that's a little more landlord friendly.
0 Reply
Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
7y
Originally posted by @Steve B.:

@Robert M. Isn’t it amazing how per capita tax revenues are going up yet the state needs more money for “basic services.” It’s like we operate in a bizarro state where the fundamental theory of “Economy of scale” works only in reverse
Clients/friends of mine are moving from Oregon because of the inheritance tax in Oregon.
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Jeremiah Mon
Rental Property Investor · San Diego, CA · Member since 2018 · 44 posts · 36 votes
7y
@Jason Powell
We only invest in landlord friendly states. No exceptions.
Good luck Jason!
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Cody L.
Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes
7y
Originally posted by @Jason Powell:

Maybe I'm just going through a little grumpy fit and being melodramatic, but are any other Oregon landlords, particularly Portland area so far, getting to their breaking point yet of how far you can be pushed by political agenda and rules?
I feel like every other month I'm hearing of more policies of power being taken from landlords, statewide rent control, lack of ability to screen tenants, removing no cause terminations, etc.
What's your tipping point before moving somewhere easier? How do you think this will affect current landlords and also your mentality on buying future rentals?
I've always wondered why ANYONE buys property in very politically 'blue' areas. You would think the rules would be so anti LL that buyers would dry up, prices would fall, and returns would go up until the pricing was such that it was wroth the risk.

But instead, the prices are high, returns are low, and you have to deal with an unfriendly government. No thanks.
I'll stick to Houston. LL friendly. Good returns. Huge growth.
1 Reply
Jason Powell
OP
Beaverton, OR · Member since 2014 · 118 posts · 119 votes
7y
@Nick Giulioni @Cody L. @Jeremiah Mon
How are all you guys investing out of state in more LL friendly states? I like the thought of this, and am considering syndications. I'd get a more passive approach, but I feel like lose control over my tax situation upon sale and likely get a lower return due to the fees/profit split involved in syndications. I also wonder if syndicators are only going for great deals these days in a tough buyers market, or if they are regularly buying subpar deals just to keep money flowing and make an income for themselves. I don't think I'm of the mindset to buy a ton of SFH through a turnkey provider of low priced homes. Honestly though this is an area I need to expand my mind and learn to give up some control and trust.
1 Reply
Account Closed
Rental Property Investor · Torrance, CA · Member since 2016 · 724 posts · 1k+ votes
7y
@Cody L. This is one of the reasons I sold my Seattle duplex. The first come first serve law was the last straw. Now I’m looking for a property in Alabama.
0 Reply
Harry White
Vancouver, bc · Member since 2014 · 19 posts · 11 votes
7y
@Jason Powell
B.C. Canada here, similar boat. Eventually you just get used to the abuse. Every rental provider I know has stopped adding to their portfolio and is holding on to their existing doors (because we don't have 1031 exchange up here.)
0 Reply
Matthew McNeil
Rental Property Investor · Boise/Portland · Member since 2017 · 709 posts · 742 votes
7y
Originally posted by @Robert M.:

Originally posted by @Matthew McNeil:
Your post is interesting. My parents own a portfolio in Central Oregon (Bend/Redmond) and due to the “political agenda” you mentioned they’re wanting to 1031 their properties over into Idaho. They've reached their “tipping point.”
Idaho IS the new Oregon. I was in Idaho this summer looking for property and could help but notice the vehicle bumper stickers, ''don't Oregonize Idaho''. I thought that was ironic. LOL
I can understand a bumper sticker advising Californians to stay away from Idaho. Interesting phrase "Oregonize." Ha!
I'm from Oregon orginally (eastern Oregon), but my portfolio is in Meridian ID. Thankful I invested 10 years ago.
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
7y
Originally posted by @Matthew McNeil:

Originally posted by @Robert M.:
Originally posted by @Matthew McNeil:

Your post is interesting. My parents own a portfolio in Central Oregon (Bend/Redmond) and due to the “political agenda” you mentioned they’re wanting to 1031 their properties over into Idaho. They've reached their “tipping point.”
Idaho IS the new Oregon. I was in Idaho this summer looking for property and could help but notice the vehicle bumper stickers, ''don't Oregonize Idaho''. I thought that was ironic. LOL
I can understand a bumper sticker advising Californians to stay away from Idaho. Interesting phrase "Oregonize." Ha!
I'm from Oregon orginally (eastern Oregon), but my portfolio is in Meridian ID. Thankful I invested 10 years ago.
as you know Oregon is the Willamette valley Eugene to Portlandia ( liberal as heck) and then the rest of the state conservative as heck..
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
7y
Originally posted by @Cody L.:

Originally posted by @Jason Powell:
Maybe I'm just going through a little grumpy fit and being melodramatic, but are any other Oregon landlords, particularly Portland area so far, getting to their breaking point yet of how far you can be pushed by political agenda and rules?
I feel like every other month I'm hearing of more policies of power being taken from landlords, statewide rent control, lack of ability to screen tenants, removing no cause terminations, etc.
What's your tipping point before moving somewhere easier? How do you think this will affect current landlords and also your mentality on buying future rentals?
I've always wondered why ANYONE buys property in very politically 'blue' areas. You would think the rules would be so anti LL that buyers would dry up, prices would fall, and returns would go up until the pricing was such that it was wroth the risk.

But instead, the prices are high, returns are low, and you have to deal with an unfriendly government. No thanks.
I'll stick to Houston. LL friendly. Good returns. Huge growth.
I dont have a dog in the hunt but i have brokered a few Apartment buildings in and around portland.. And why the buyers came here was stability and a decent run B class has little to no bad debt and very little turn over or lost rents..
when some think of easy LL laws those are also areas with big turn over in tenants and pretty big swath of C and D class which are really tough look great on paper but if your not on top of it you can get your clock cleaned.. In portland there is such a shortage of housing your tenant base is really pretty strong.. At least thats what my clients tell me..
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Account Closed
Specialist · Paradise Valley, AZ · Member since 2018 · 3k+ posts · 2k+ votes
7y
Originally posted by @Jason Powell:

@Jeff S. It's the "next wave" of screening rules I'm most worried about, as well as general trend. From what I can gather, landlords will not be able to decline applicants based on most criminal records, past evictions, and others as long as it was longer than 12 months ago. Personally, I feel that an applicant that was evicted 18 months ago is someone you couldn't pay me to accept. And thanks; I do consider myself a different breed of advisor. But I do feel like advisors get a bad rep amongst the real estate crowd. Fact of the matter is, the vast majority of folks out there want something 100% passive that will never cause them personal drama or time. RE is like a side business for most. I preach the owner occ FHA 4 plex to young folks, but almost nobody is interested due to the inconvenience and misaligned spousal goals.
@Mathew Wray Thanks for weighing in! I'm trying to decide which group I'm in. I avoided Portland as the path of least resistance, but now I'm being told that the "Portland rules" will be spread to all of Oregon. That was a shock to the system for sure. I have a hard time mentally processing how this will lead to much higher rents. I can obviously see rent control in NY, San Fran, etc and see they have super high rents, but I guess it's a chicken and the egg scenario; I don't know what preceeded what. I figure it may discourage rental house building...??
@Nathan Gesner I tend to agree, and that's the way I feel. The implementation of doing that is a challenge though. I'm fearful of a 1031 exchange into a market I don't know. I hear a LOT of people regretting this decision due to the time pressure. I will have a $250k+ tax bill if I can't pull that off. Speaking of me be grumpy about Oregon, they will shave another 10% off my gain and recapture. I am in the middle of selling one property though and just paying off my house with it (super unpopular move on BP I'm aware). That one was 25% tax free though. I guess that's my middle ground at the moment. Maybe I'll consider selling another in 2020.
None of those insane laws apply in Arizona. In fact, AZ properties still cash flow and the landlord is "Welcome". AZ is "landlord friendly", low taxes and best of all SUNNY! ;-) I sold all of my my properties in Washington because it's going the same way as Oregon. Makes no sense. Go before they come up with a tax on selling a property like they soak you in some places.
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Matthew McNeil
Rental Property Investor · Boise/Portland · Member since 2017 · 709 posts · 742 votes
7y
Originally posted by @Jay Hinrichs:

Originally posted by @Matthew McNeil:
Originally posted by @Robert M.:

Originally posted by @Matthew McNeil:
Your post is interesting. My parents own a portfolio in Central Oregon (Bend/Redmond) and due to the “political agenda” you mentioned they’re wanting to 1031 their properties over into Idaho. They've reached their “tipping point.”
Idaho IS the new Oregon. I was in Idaho this summer looking for property and could help but notice the vehicle bumper stickers, ''don't Oregonize Idaho''. I thought that was ironic. LOL
I can understand a bumper sticker advising Californians to stay away from Idaho. Interesting phrase "Oregonize." Ha!
I'm from Oregon orginally (eastern Oregon), but my portfolio is in Meridian ID. Thankful I invested 10 years ago.
as you know Oregon is the Willamette valley Eugene to Portlandia ( liberal as heck) and then the rest of the state conservative as heck..
My real estate agent over in Boise said he's getting more and more inquiries from conservative people living in Seattle and the Willamette Valley who are fed up with the growing extreme liberalism they see happening in these areas. They want to relocate to more conservative areas.
1 Reply
Johann Jells
Rental Property Investor · Jersey City, NJ · Member since 2011 · 1k+ posts · 876 votes
7y
Originally posted by @Cody L.:

High rents, high appreciation, upwardly mobile, high functioning, college educated tenants dripping with common sense (mostly). I've done very well here. My 13 doors are worth more than 100 down in Texas with so many times the roofs, toilets, sinks etc.
The OR screening stuff sounds awful, but honestly, 7%+ inflation allowable raises per year with vacancy decontrol does not sounds onerous to me. I have never exceeded that doing this 21 years. That's far different than is typical in rent control cities around here.
1 Reply
Rhonda Wilson
Rental Property Investor · Tacoma, WA · Member since 2018 · 113 posts · 149 votes
7y
We still have two investment properties in Oregon. We are thinking very seriously about selling and getting out. It's not just Senate Bill 608, it's the trend. It really seems as though the Oregon legislature is convinced that landlords are the problem with housing and not providers of housing. It's very frustrating. I mean, our average rent in Oregon is $800. We do feel that we provide a fair value for value received. I hate to see it change from a market driven to a legal driven housing system.
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Keith A.
Rental Property Investor · TX · Member since 2019 · 236 posts · 392 votes
7y
It all starts with who you vote for. There is a reason people are moving from Cal and Oregon to the blessed state of Texas. God I hope they don’t bring those politics and ideals with them. I hope my landlord friends in Portland fight back.
1 Reply
Cody L.
Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes
7y
Originally posted by @Account Closed:

@Cody L. This is one of the reasons I sold my Seattle duplex. The first come first serve law was the last straw. Now I’m looking for a property in Alabama.
Crazy how the government has the nerve to act as if YOUR property is THEIR property.
0 Reply
Cody L.
Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes
7y
Originally posted by @Jay Hinrichs:

Originally posted by @Cody L.:
Originally posted by @Jason Powell:

Maybe I'm just going through a little grumpy fit and being melodramatic, but are any other Oregon landlords, particularly Portland area so far, getting to their breaking point yet of how far you can be pushed by political agenda and rules?
I feel like every other month I'm hearing of more policies of power being taken from landlords, statewide rent control, lack of ability to screen tenants, removing no cause terminations, etc.
What's your tipping point before moving somewhere easier? How do you think this will affect current landlords and also your mentality on buying future rentals?
I've always wondered why ANYONE buys property in very politically 'blue' areas. You would think the rules would be so anti LL that buyers would dry up, prices would fall, and returns would go up until the pricing was such that it was wroth the risk.

But instead, the prices are high, returns are low, and you have to deal with an unfriendly government. No thanks.
I'll stick to Houston. LL friendly. Good returns. Huge growth.
I dont have a dog in the hunt but i have brokered a few Apartment buildings in and around portland.. And why the buyers came here was stability and a decent run B class has little to no bad debt and very little turn over or lost rents..
when some think of easy LL laws those are also areas with big turn over in tenants and pretty big swath of C and D class which are really tough look great on paper but if your not on top of it you can get your clock cleaned.. In portland there is such a shortage of housing your tenant base is really pretty strong.. At least thats what my clients tell me..
In Houston, the laws are very LL friendly, and in Houston you can buy A properties in A areas, or C properties in C areas or various mixes. So yeah, Houston has it's high yield (if you know what you're doing ) C area / C class properties but that's not what I focus on specifically.
0 Reply
Cody L.
Rental Property Investor · San Diego, CA · Member since 2013 · 3k+ posts · 4k+ votes
7y
Originally posted by @Johann Jells:

Originally posted by @Cody L.:
High rents, high appreciation, upwardly mobile, high functioning, college educated tenants dripping with common sense (mostly). I've done very well here. My 13 doors are worth more than 100 down in Texas with so many times the roofs, toilets, sinks etc.
The OR screening stuff sounds awful, but honestly, 7%+ inflation allowable raises per year with vacancy decontrol does not sounds onerous to me. I have never exceeded that doing this 21 years. That's far different than is typical in rent control cities around here.
It's not that. It's the mentality. That they control what you do with your property. It's that mentality, perhaps not this specific law (rent control @ 7% max) that causes risk in my mind. What happens if tenants all say "We're not going to pay" (rent strike). That same mentality that creates all these LL unfriendly laws is the same mentality that's going to take the tenants side in such a strike.

No thanks.
And my area of Houston has very high rents, high appreciation (every property I've bought in the last 2-3 years has more debt on it than I've paid due to high appreciation. Tons of colleges around my properties. The largest med center in the US (maybe the world?). Tons of job and population growth. And that good 'ole live-and-let-live attitude that I respect.
You say your 13 doors are the same value as 100 in Texas is if Texas is a monolith. Dude, not even Houston is a monolith. Not even our "inner loop" of Houston is a monolith. Within 5 miles you can find old class C at $150k/door and $30k/door.
2 Reply
Nick GiulioniPro Member
Rental Property Investor · Carmel, IN · Member since 2016 · 1k+ posts · 615 votes
7y
@Jason Powell I started with a turnkey to start my connections and have subsequently purchased another 10 houses. Key is to find a great PM and agent. Highly recommend reading Long Distance Real Estate Investing. David Greene lays it all out very effectively!
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