Oregon Housing Legislation Looms Large in Salem 2/18/2026
Update written and edited by Aaron Kirk Douglas, HFO Director of Market Intelligence.
Short Session Housing Bills Advance: Oregon lawmakers are moving quickly on a slate of housing proposals in the 35-day session, including production funding, land-use changes, permitting tweaks, and landlord-tenant policy. The session is slated to end by Sunday, March 8, 2026.
Inclusionary Zoning/Inclusionary Housing—SB 1521 Could Reshape Portland’s IH Framework
SB 1521 allows cities and counties to require affordability in new multifamily projects. But, in the Portland MSA, those mandates are not enforceable unless the city provides offsets equal to the expected marginal loss in value, based on a formal economic analysis of a “prototypical” project. Offsets may include cash, property tax exemptions, or fee/SDC reductions, and developers must be offered an in-lieu fee option.
How this intersects with Portland’s current IH In Portland, IH applies to projects with 20+ units. Rental projects that provide IH units are subject to a 99-year affordability covenant, while the primary offset tool (MULTE) provides roughly a 10-year property tax exemption. Most underwriting treats these public restrictions as a structural value drag: long-term restricted rents paired with a time-limited tax benefit.
Bottom line for multifamily investors: If enacted, SB 1521 would require Portland to justify IH through a formal economic analysis and ensure offsets match the modeled marginal loss in value. For underwriting, that means modeling two scenarios: • Current IH economics • IH with value-matching offsets It doesn’t eliminate affordability risk; it formalizes the math. It may cause some jurisdictions to reconsider whether inclusionary mandates are worth the administrative and fiscal complexity. Status: 2/5 – public hearing. 2/12 work session; no committee meetings or floor sessions are scheduled.
Funding/Enforcement/Urban Growth/Zoning
HB 4036 would create the Preserve Affordable Homes for Oregon Fund using Article XI-Q bond proceeds to preserve at-risk affordable units. (MFNW Supports) Referred to ways and means 2/12. No further action set.
HB 4037 is a broad “streamlining” package that includes changes to state housing programs, new enforcement tools for the Housing Accountability and Production Office, faster plan review for smaller housing, and process changes intended to shorten land-use approval timelines. (MFNW Supports). Set for second reading 2/17 and third reading 2/18. Land-use and siting flexibility is also a major theme.
HB 4082, which would expand the temporary UGB addition program so a city (or Metro) could add land specifically for manufactured dwelling parks or “housing for older persons,” affordable up to 120% of the area median income. The Housing & Homelessness committee recommended the bill on 2/12. It received a second reading on 2/16, and a third reading is set for 2/17.
SB 1578 would allow certain low-density counties to rezone up to 50 acres for housing at a minimum of five units per acre (through 2034) and would broaden the allowable size of rural ADUs. This bill was referred to the Housing & Development Committee. The committee held a public hearing on 2/10 and a work session on 2/12. No hearings or meetings are scheduled.
SB 1522 is flagged as a placeholder tied to amendment language on “urban reserves” outside urban growth boundaries. Public hearing held 2/12 in Housing and Development. No committee meetings or floor sessions are scheduled.
Landlord-tenant and resident-facing rules
HB 4120 would let multifamily landlords convert a property to nonsmoking for existing tenants with 90 days’ written notice (applying to new and existing rental agreements). Referred to Housing and Homelessness. 2/12 Public Hearing and work session. 2/16 recommended to pass with amendments. 2/17 second reading. 2/18 third reading.
HB 4123 would limit when a landlord may disclose confidential information and would authorize statutory damages for knowing violations. Public hearing held 2/5 in Housing & Homelessness; 2/10 work session held; 2/12 recommended do pass with amendments; 2/16 second reading; 2/17 third reading. ·
SB 1523 concerns tenant portals—the online systems landlords use for applications, document signing, ID verification, and more.
- First, landlords who accept applications through a tenant portal must make a printable version of the application available. They must either post it on their website or provide a printed or printable copy within seven days if someone asks in writing.
- Second, landlords must process applications whether they come through the portal or not. In other words, you can’t refuse to consider someone just because they didn’t apply online.
- Third, if an applicant or tenant asks in writing for an alternative, the landlord cannot require the portal as the sole method to: (a) verify identification, (b) review and sign addenda or legal agreements, or (c) submit tenancy-related documents. So basically, it says portals are fine, but they cannot be mandatory if someone asks for a non-digital option.
- Fourth, landlords are still allowed to use portals internally and enter tenant information into them. The bill does not ban portals.
- If a landlord fails to comply, the applicant or tenant is entitled to actual damages or $100, whichever is greater.
Lawmakers are likely responding to concerns that:
- Some applicants lack internet access
- Some tenants are elderly or not tech-comfortable
- Some individuals have disabilities affecting digital use
- Some people distrust or struggle with digital identity verification.
From an operational standpoint, multifamily operators will need:
- Printable applications ready
- A documented process for handling offline submissions
- Staff training so leasing agents don’t accidentally refuse non-portal submissions
- A system for tracking written alternative requests
The $100 statutory damage provision is small, but it creates private enforcement leverage. In short: portals allowed, portal-only requirements prohibited. This bill passed out of the Housing and Development committee with a do-pass recommendation as amended. A second reading was held on 2/16, and a third reading is scheduled for 2/17 in the Senate.
Labor, building-code, and consumer-protection bills
SB 1566, which would exempt certain public works projects (primarily affordable housing-related) from prevailing wage requirements. 2/2 referred to Labor and Business; 2/9 public hearing held. No additional hearings or meetings are scheduled.
HB 4029 (licensing and required disclosures/contract terms for solar energy systems). First reading 2/16; referred to Energy and Environment. No additional meetings or floor sessions scheduled.
HB 4080, which would allow portable solar PV devices up to 1,200 watts and would limit landlord/HOA/condo restrictions on those devices (with a utility declaration requirement). 2/2 Referred to Climate, Energy, and Environment; 2/5 Public Hearing. No additional meetings or floor sessions scheduled.
HB 4128, which would require a single-family home to be listed publicly for at least 90 days before an institutional investor or entity funded by one that owns 2,500 or more single-family homes or pools investor funds or manages $1B or more in assets could purchase it (with disclosure and enforcement provisions). Exempts nonprofits. $250k penalty per illegal purchase. Public hearing held 2/10. Work session 2/12. Recommended to pass with amendments. Second reading 2/17. Third reading 2/18.
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