How does Washington State’s Rent Control bill impact Landlords?

This week, Governor Bob Ferguson signed the Washington State House Bill 1217 (HB 1217), or typically speaking, the “Washington State Rent Stabilization Bill”. In this post, we’ll highlight the changes of this law and how it will impact single-family rental property landlords. HB 1217 introduces several changes to landlord-tenant regulations, with an emphasis on increasing transparency and tenant protections.

Key Changes in Bill HB 1217:

• Rent Increase Cap: Annual rent increases are limited to the lesser of 7% plus inflation or 10%. This cap applies to most rental properties, including single-family homes owned by corporations, LLCs, or REITs.
• Notice Requirements: Landlords must provide at least 90 days’ written notice before implementing any rent increase. Previously, you only needed to provide 60-days written notice. The method for how you send any notice now also has to be changed. Previously, you needed to deliver via personal delivery and First-Class mail. Now, you must deliver all notices via personal delivery and now Certified Mail.
• First-Year Rent Freeze: Rent increases are prohibited during the first 12 months of a tenancy.
• Lease Termination Rights: Tenants have the right to terminate their lease with 20 days’ notice if a rent increase exceeds the legal cap, without any lease break penalty.
• Enforcement and Penalties: Violations can lead to legal action by tenants or the Washington Attorney General, with potential penalties including actual damages, up to three months’ rent, and attorneys’ fees. The Attorney General can recover up to $7,500 per violation.
• Exemptions: New construction rentals are exempt from the cap for 12 years after completion.

This law is taking immediate effect. A professional property manager should work to change their processes to accommodate the new law. Below are examples of how Zenith Properties NW is changing our processes.

Changes to Zenith Processes: 

• Training: Our team is receiving full training on this bill through several of our key resources such as our legal representatives and NARPM (National Association of Rental Property Managers.)
• Notice Requirements: We are updating the notice language to be in compliance with the law. We will begin the process of sending all notices via certified mail and have updated our processes to ensure appropriate documentation is saved in our system.
• Bi-Annual Evaluations: Previously, we scheduled an evaluation of the property at the 90-day mark of tenancy, but will now begin the process of scheduling at 120-mark. We want to ensure an evaluation of the property is done prior to sending the lease renewal.
• Lease Renewal: We will begin issuing lease renewals well in advance of the 90-day requirement and have updated our forms with the correct language as advised by our council. Additionally, we have our resources updating our Lease to further be in compliance.
• Communication: We know that navigating this transition will raise questions for our clients and our tenants. Our team will be fully prepared to provide to support both with any questions that arise. You can confidently reach out to your Portfolio Manager for any questions you have.

For a comprehensive overview of HB 1217, you can refer to the official bill summary here.

Why This Matters 

Laws like HB 1217 are exactly why having an experienced, responsive property management team matters. A professional property manager, like Zenith Properties NW, responsibility is to shield you from legal risk, preserve your income, and keep your investments compliant and performing.