The referendum would eliminate Portland's 5 percent cap on rent hikes when tenants voluntarily move.
A pedestrian passes luxury rental apartments in Portland on May 6, 2022. Credit: Troy R. Bennett / BDN

There’s a new campaign underway to undo a cap on rent increases in Portland.

Landlords, property managers, developers and realtors are behind a referendum drive to eliminate a 5 percent limit on rent increases when a tenant voluntarily moves or the unit changes hands.

The proposal, brought forth by the Rental Housing Alliance, would allow landlords to raise rent by an unlimited amount if a tenant moves or an apartment changes hands. The initiative received more than 3,000 verified signatures, and the Portland City Council agreed back in March to send the measure to voters.

Rep. David Boyer, R-Poland, said he’s involved because he has experience gathering signatures for past citizen initiatives. He also owns two rental units in Portland, and believes the existing law has forced landlords to raise rates more often than they would have otherwise.

“This is a really common-sense fix to alleviate the pressure that housing providers feel to raise the rent,” he said. “It would reduce the incentive for them to, since they know on the back end they’ll be able to bring it to fair market value once a tenant voluntarily vacates.”

The initiative would only eliminate the 5 percent cap on rent increases for voluntary tenant turnovers. Landlords, for example, would still be subject to other limits on rent increases and would need to give at least 90 days’ notice of a rate change.

Boyer said he charges $1,375 for one of the two, three-bedroom units that he owns in Portland. Though he raised the rent recently, Boyer said the rate is still well below the market-rate for the unit.

“Say you bought a building years ago and you rent out one of the units to a family friend or a friend, and you’re giving them a good deal on rent because that’s just what you do,” he said. “And now you’re kind of locked into this good deal and you have to give it to the next stranger that comes along. I don’t think that’s fair.”

Portland voters will consider the measure during the June 13 election.

Campaign finance reports show that the Committee to Improve Rent Control has raised more than $75,000 from property managers, landlords and others to support the initiative.

The Maine Democratic Socialists of America, which spearheaded the original rent control policy back in 2020 and additional changes approved by voters last fall, opposes the initiative. It has raised less than $50 for a text opposition campaign, according to finance reports filed with the city.

This article appears through a media partnership with Maine Public.