Increasing housing costs, including rents, have been covered ad nauseam over the past several months.
Changing rents — both increasing and decreasing — are a reality of the housing market, but laws do exist to protect renters and ensure transparency in the process.
The first and most important thing to be conscious of as a tenant is that your agreement must either be up for expiration or renewal, or be a month-to-month agreement in order for the landlord to increase your rent.
A term agreement means that rent is fixed for the given period, and not subject to change. This holds true even in situations where there is a change in ownership of the property.
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Where the rent increase issue can tend to get confusing is differentiating between Washington state law, and laws in the city of Seattle due to two different sets of laws pertaining to rent increase notification requirements.
For any rental property not located within the city of Seattle the process is very simple and straight forward. All that is required is a 30-day notice before the beginning of the rental period (not 30 days from when the landlord sends it) for which the increase is to take effect.
As an example, if a tenant living in Bellevue were on a month-to-month agreement and the landlord sought to increase rent effective the rental period beginning on March 1st, 2014, a minimum of 30-days notice before March 1, 2014 would be required.
Within the city of Seattle there is a unique twist on how much notice is required before a rent increase can take effect if the increase is 10 percent or greater of rent.
In Seattle the number of days notice a landlord must give their tenant is determined by the percentage increase over the current rent amount.
There are two aspects to rent increases of 10 percent or greater in the city of Seattle.
If the rent increase is a one-time amount equaling 10 percent or greater of the current rent, the tenant must be given 60-days notice before the beginning of the rental period for which the increase is to take effect.
In real-world application this means that a tenant on a month-to-month agreement in Seattle paying $1,000 in rent who receives an increase of $100 (10 percent increase) must be provided with 60-days notice before the new rent amount taking place.
The second aspect of the 10 percent threshold applies to cumulative rent increases totaling 10 percent or more over a 12-month period starting after the first rent increase.
This rule manifests itself in the following way: A tenant on a month-to-month lease in Seattle is paying $1,000 rent per month. On March 1, 2014 their rent is set to increase by $75 per month (7.5 percent increase) with the standard 30 days notice.
If the landlord then later decides to increase the monthly rent by another $50, and it is within 12 months after the original rent increase which takes effect March 1, 2014, the landlord would be required to give 60-days notice before the second rent increase because the $50 raise would constitute a cumulative rent increase amount of $125, or 12.5 percent of the original rent amount.
Anything less than 10 percent in the city of Seattle falls under the normal 30 day notice provision of state law.
One other aspect of rent increases which tenants may want to review is when a rent increase is used “primarily to retaliate against a tenant because of the tenant’s good faith and lawful act.” RCW 59.18.240 makes retaliatory rent increases by the landlord illegal.
How can a tenant in this market keep their rents lower?
One thing to consider in the present market is requesting long-term leases beyond standard six- or 12-month periods.
While one of the bigger benefits or renting is flexibility and opportunity to move after a short period of time without feeling locked in to a home, a longer term lease will keep your housing costs locked in and predictable.
Some landlords may want to keep the flexibility of shorter term leases to allow for keeping rents at market rates, but many other landlords will appreciate having a good tenant signed up for a longer period as it ensures not having to deal with the hassle of re-renting a unit should a rent increase price their current tenant out of the property.
Sean Martin is the director of external affairs of the Rental Housing Association of Washington, a not-for-profit association of more than 5,000 landlord members statewide. Rental Resource is the organization’s biweekly column. For more information for landlords or tenants, visit rhawa.org.