Updated April 2026 — Oregon’s rental laws carry more rules and nuance than most owners realize. From rent increase caps tied to CPI to relocation payments that can cost you three months’ rent if handled wrong, these five laws trip up Central Oregon landlords more than any others. Here is what you need to know to stay compliant.
We deal with these laws every day here at Ridgeline Property Management, and we see owners get tripped up by the same issues over and over. Getting these wrong can mean invalid notices, surprise relocation payments, or penalties up to three months’ rent. Here are five laws we think every Central Oregon owner needs to understand.
1. Rent Increase Caps (ORS 90.323)
Oregon caps annual rent increases at 7% plus CPI, with a hard ceiling of 10%. For 2026, the maximum allowable increase is 9.5%. However, the cap does not apply to properties where the first certificate of occupancy was issued less than 15 years ago.
With all the new construction in areas like NW Crossing, the Old Mill District corridor, and southeast Redmond, this exemption is relevant to a significant number of owners in our market. If your property was built after 2011, you may be exempt — but that changes every year as properties age past the 15-year mark.
Manufactured home parks with more than 30 spaces now have a separate lower cap of 6% under HB 3054. Know the age of your property and check the published rate every year before issuing any increase. If you are considering investing in Bend real estate, understanding which properties are exempt is an important part of the analysis.
2. The 12-Month Occupancy Rule (ORS 90.323)
Under ORS 90.323, you cannot increase rent during the first year of tenancy, and after that you can only increase it once per 12-month period. The key here: the clock is tied to occupancy, not the lease term. If you sign a tenant to a 10-month lease, you still cannot raise rent until 12 months of occupancy have passed.
On top of that, any increase requires 90 days’ written notice. So plan ahead — if you want to raise rent at the 12-month mark, that notice needs to go out by month 9. We recently caught this timing issue for an owner in NE Bend who nearly missed the window, which would have delayed their increase by another full year.
For more on how we approach setting the right rental rates in the current Bend and Redmond market, check out our guide.
3. Termination Notices: Under vs. Over 12 Months (ORS 90.427)
During the first year of occupancy, you can end a tenancy with a 30-day no-cause notice. No reason needed, no relocation payment required.
After the first year, no-cause terminations are off the table. You can only terminate for cause or for a “Qualifying Landlord Reason” (QLR) — things like selling to an owner-occupant, a family member moving in, demolition, or a major remodel. QLRs require a 90-day written notice stating the reason and supporting facts.
One exception worth noting: if you live on a property with two or fewer units (duplex, house with ADU), you can issue a 60-day no-cause notice after the first year. This applies to a lot of owner-occupied duplexes we see in Bend’s Westside and Old Bend neighborhoods.
4. Relocation Assistance (ORS 90.427)
If you terminate after the first year using a QLR, you generally must pay the tenant one month’s rent as relocation assistance along with the 90-day notice.
One recent change worth noting: under Senate Bill 586 (effective September 2025), if you are selling a unit to a buyer who will occupy it as their primary residence, you can now give a 60-day notice instead of 90 days, as long as you still pay one month’s rent in relocation assistance.
There is also an exemption for owners with an interest in four or fewer units in Oregon — so smaller Central Oregon investors may not owe relocation at all. But if you own five or more units, budget for it. Getting the notice wrong can result in penalties up to three times the monthly rent plus damages and attorney fees. We have seen this happen — and it is why many owners who try to manage terminations themselves end up coming to professional management afterward.
5. Service Animal Deposits (ORS 90.300)
Under ORS 90.300(4), you cannot charge a pet deposit for a service animal or companion animal (emotional support animal) that a tenant with a disability needs as a reasonable accommodation. No pet fee, no pet rent, no additional deposit. You also cannot apply breed or size restrictions or require the animal to be “certified.”
The tenant is still on the hook for any damage the animal causes — you can deduct that from the standard security deposit like any other tenant-caused damage. For more on how deposits and renters insurance requirements work together to protect owners, see our recent article.
Frequently Asked Questions
Can I raise rent in Oregon during the first year of a lease?
No. Under ORS 90.323, rent cannot be increased during the first 12 months of occupancy. After that, you can increase once per 12-month period with 90 days’ written notice.
What is the maximum rent increase allowed in Oregon in 2026?
The maximum is 9.5% for 2026 (7% plus CPI). Properties with a certificate of occupancy issued less than 15 years ago are exempt from the cap.
Do I have to pay relocation assistance in Oregon?
If you terminate a tenancy after the first year using a Qualifying Landlord Reason (QLR), you generally must pay one month’s rent as relocation assistance. Owners with an interest in four or fewer units in Oregon may be exempt.
Can I charge a pet deposit for a service animal in Oregon?
No. Under ORS 90.300(4), landlords cannot charge a pet deposit, pet rent, or pet fee for service animals or emotional support animals. You can still deduct damage from the standard security deposit.
What happens if I give an invalid termination notice in Oregon?
An invalid notice can result in penalties up to three times the monthly rent plus damages and attorney fees. Getting the notice type, timing, and required content wrong are the most common mistakes.
These laws change regularly. At Ridgeline Property Management, we stay on top of all of this so our owners do not have to. If you have questions about how any of these rules apply to your property in Bend, Redmond, or anywhere in Central Oregon, contact our property management team — we are here to help.
Not sure if professional management makes sense for your rental? Start with a free rental analysis to see what your property could earn.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Always consult with a qualified landlord-tenant attorney before making legal decisions regarding your rental property.