Oregon & SW Washington Multifamily Marketwatch® Weekly: October 6, 2025
Welcome to this week’s edition of Multifamily Marketwatch for Oregon and SW Washington.
Portland Apartment Construction Plummets
New apartment construction in 2025 is far below peer cities. Portland’s steep decline in new apartment construction is exacerbating concerns in an already tight housing market. Only about 3,900 new apartment units are expected to be completed in the Portland metro area this year, a roughly 54% drop compared to 2024’s output [32]. That is a much sharper decline than in many similarly sized metros; for context, San Antonio is on track for ~8,100 new units this year, and Salt Lake City is on track for ~6,500 [33].
Portland’s construction slowdown is part of a broader national trend: higher interest rates and building costs, along with signs of softening rent demand in some regions, have made developers more cautious about starting projects [34]. Harvard’s Joint Center for Housing Studies noted earlier this year that “the boom in multifamily construction is ending,” as financing tightens and builders work through existing pipelines [35].
Bad timing.
This downturn comes at an inopportune time for Portland. The city and state have been grappling with a well-documented housing affordability crisis, and officials have enacted zoning changes and incentives to spur more development in recent years [36]. Despite those efforts, new supply is now falling well short of targets. A prolonged construction slump could exacerbate the region’s housing shortage and lead to increased upward pressure on rents in the long term. Local policymakers are watching these trends warily, as Portland’s ability to house its growing population may depend on reversing the decline in construction once interest rates stabilize. For now, though, the steep drop in building in 2025 suggests that developers are pulling back – a warning sign that Portland’s housing woes could deepen if the market doesn’t regain confidence [36].
Oregon Sets 2026 Rent Increase Caps Amid Confusion
Oregon’s statewide rent control law will impose a significantly lower cap on rent hikes in 2026 — but the announcement came with some initial confusion. On October 3, the state Department of Administrative Services (DAS) stated that most landlords could raise rents by up to 9.5% next year, a decrease from the 10% allowed in 2025. [20] (Oregon’s law limits annual increases to 7% plus inflation, capped at 10%, for units over 15 years old [21].)
However, officials soon acknowledged that they had misinterpreted a new law when making that calculation [22].
House Bill 3054 – Mobile Homes and Marinas over 30 Units
House Bill 3054, passed earlier this year, sets stricter limits for larger marinas and mobile home communities. After a hasty correction, DAS clarified that for larger manufactured home parks and marinas with more than 30 spaces, the maximum 2026 rent increase is only 6%, while smaller rentals (30 or fewer units, or those covered under standard rent stabilization rules) indeed have a 9.5% cap [23]. This two-tier system is a first for Oregon and is based on the statutory formula and CPI data [24]. The initial press release mix-up caused some confusion regarding the rent cap, but the Oregon agency has since publicly clarified and corrected the announcement to ensure that landlords and tenants understand the correct 2026 limits [22]. Oregon’s rent control law still exempts new buildings under 15 years old to avoid deterring development [25], but for older units, the 2026 caps are now locked in at 6% or 9.5% depending on the property type and size.
Major Landlords Settle Rent-Setting Algorithm Lawsuit
A coalition of big property managers has reached a blockbuster settlement in a lawsuit over alleged rent price-fixing tools. Greystar, the nation’s largest apartment manager, and 25 other landlords agreed to pay more than $141 million to settle a class-action case accusing them of using RealPage’s software to coordinate rental pricing [26]. The plaintiffs claimed RealPage’s algorithmic pricing system (used by many large landlords) allowed competitors to share detailed private data and “align” rents higher than they otherwise would in a truly competitive market [27].
As part of the settlement, the companies do not admit wrongdoing but have agreed to stop sharing non-public leasing information with RealPage for its rent-setting platform [27]. Attorneys for renters called this a “fundamental shift” that will help reverse the kind of anti-competitive coordination alleged in the case [28]. Greystar alone is slated to pay $50 million of the sum under the proposal, which was filed in federal court last week and still needs a judge’s approval [29][30]. Notably, this class-action settlement does not include RealPage itself, which continues to fight separate antitrust lawsuits brought by the U.S. Department of Justice and state attorneys general [31].
RealPage insists its product is lawful and that landlords often lower rents based on its recommendations, though the company’s access to competitors’ data has drawn intense scrutiny. If approved, the settlement funds will be distributed to millions of renters affected, and it bars the settling landlords from any future collaboration via rent algorithms [27] – a win for tenant advocates who have long suspected such tools inflate housing costs.
Washington State Legislators Preview 2026 Housing Agenda
Washington’s legislative housing leaders have outlined a vision for 2026 focused on expanding affordable housing and tenant protections [1][2]. Key proposals include introducing legislation to prevent cities from denying permits for permanent supportive or transitional housing projects in designated zones [3]. Lawmakers are also exploring solutions for rural areas, such as promoting accessory dwelling units (ADUs), and building on 2025’s reforms that encouraged transit-oriented development, lot splitting, and reduced parking requirements [4].
Washington 2025 Rent Caps
This year, the legislature enacted a statewide rent cap (annual increases limited to 7% plus inflation, capped at 10%) [2] and invested about $600 million into the state’s Housing Trust Fund to finance new affordable homes [5]. However, a strained state budget and looming federal cuts to housing funds could constrain these ambitions [6][7]. To raise revenue, Democratic lawmakers are floating ideas like a “wealth tax” on intangible assets [7], though Governor Bob Ferguson has so far been cool to that suggestion. The 60-day legislative session begins in January, when these housing measures and funding questions will take center stage.
[1] [2] [3] [4] [5] [6] [7] Washington state Legislature’s housing leaders outline vision for 2026 – OPB https://www.opb.org/article/2025/10/05/washington-legislature-housing-vision/
[8] [9] [10] [11] [12] [13] [14] [15] [16] Seattle’s affordable housing industry is in crisis. City faces tough choices
[20] [21] [22] [25] Rent cap confusion: Oregon agency fumbles announcement of 2026 limits | https://www.oregonlive.com/business/2025/10/rent-cap-confusion-oregon-agency-fumbles-announcement-of-2026-limits.html
[23] [24] Oregon Sets New Rent Increase Limits for 2026 with 6 Percent Cap for https://hoodline.com/2025/10/oregon-sets-new-rent-increase-limits-for-2026-6-cap-for-larger-complexes-9-5-for-smaller-housing/
[26] [27] [28] [29] [30] [31] Greystar and other landlords agree to $141M deal over RealPage rent algorithms | AP News https://apnews.com/article/realpage-lawsuit-rental-software-algorithm-greystar-settlement-5a52c3cea866757a508d2efa8e12d0b5
[32] [33] [34] [35] [36] Portland sees 54% drop in new apartment construction – Axios Portland https://www.axios.com/local/portland/2025/09/30/portland-apartment-construction-drop
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