There are several bills making their way through the Oregon legislative process which are relevant to housing costs. This will likely be a controversial post, as I think both ‘sides’ are saying some things that make sense – and some that don’t. If you have an opinion, jump in and discuss it on our new Facebook group: https://www.facebook.com/groups/BendYIMBY/
One bill would disallow no-cause evictions, and allow cities to pass rent-control bills:
These might seem like good ideas at first as they’d help people who are getting hit by the sharp end of the housing crisis. Beyond the short term, though, they don’t help, as landlords who have less control over their property are that much more likely to get out of the rental business altogether and simply sell the property. These provisions would also likely provide fewer incentives for people to jump in and build new housing or renovate and rent out a house. So while they may help a few people now, they may well be counterproductive, which means that renters in the future may pay for them. For instance, landlords could very well get a lot pickier about who they rent to if it becomes significantly more difficult to ask people to leave.
See this Paul Krugman article about rent control.
Some say that there are loopholes and exceptions and so on – but doesn’t that just make things more complex (more lawyers?) and make these previsions weaker?
Ultimately, the only way to fix the housing crisis is to add enough supply – which can also mean building up, or infill, not just building out – rather than band-aid solutions that don’t address the root cause of the crisis: too many people chasing after too few places to live. Much of economics is more complicated than simple “supply and demand”, but it’s a pretty good place to start. Look at how adding lots of apartments helped stabilize rent prices in Denver:
Another proposal sounds more interesting: removing the mortgage interest deduction above a certain threshold.
As above, appearances can be deceiving: what at first glance sounds like something that might help people to own homes mostly accrues to wealthier people (they own more expensive homes). Removing this large government subsidy would likely lower the price of housing, as a significant amount of “easy money” would be removed from the system for things like vacation homes.
In the case of a house purchased to rent out, some of the price increase might be passed on to renters, so the bill may be worth modifying from that point of view, or at least considering future ramifications. But given Oregon’s budget woes, subsidies that mostly accrue to people wealthy enough to own vacation homes could likely be dispensed with.