An Op-Ed by Ron Ross, CCIM
It is true that there is a housing shortage in many Oregon communities. There are many reasons and factors contributing to this situation. A serious and honest discussion about those issues would seem to be in order. It appears that is not going to happen in Oregon politics.
The easy and politically expedient response is to target, punish, and obstruct housing providers, a.k.a. developers and landlords. Logic would dictate that when there is a shortage of something, the providers of that product should be encouraged and incentivized to provide more. Instead, Oregon politicians have waged an all-out regulatory assault, rather than working with and encouraging those with a vested interest. Various cities, the most notable being Portland and Bend have already enacted policies to discourage, obstruct, and increase costs for housing providers.
Inclusionary zoning which mandates that developers include affordable housing in all multifamily developments, enacted by the city of Portland has nearly stopped all multifamily development since it was imposed in December. The “unknown” factors, the decrease in stabilized property values, and the fact that neighboring jurisdictions are not requiring inclusionary zoning have seriously dissuaded developers from developing in Portland. Inclusionary zoning is also being considered statewide.
Several proposals are currently working their way through the state legislature. The most problematic of those are:
1. Rent control
2. Elimination of no cause evictions
3. Requirement of landlords to pay tenant relocation costs in many situations
4. Inclusionary zoning
Besides the trampling of private property rights, these policies will, without a doubt, discourage housing development and will increase costs for landlords and developers, in turn increasing housing costs for everyone. There are many unintended consequences for such actions that will ultimately result in just the opposite of what is needed, and will hurt renters and home buyers across the board.
Ron Ross, CCIM, is a Principal Broker with Compass Commercial Real Estate Services and a Central Oregon property owner and landlord. His opinions do not necessarily represent those of Compass Commercial.