What does WA State Rent Control Mean?

What is Washington State's new rent control law going to mean for tenants and for owners? Let me break it down. First of all, there's no limits on where you can place new tenants' rent. There's no limits on rent in general. There are limits on rent increases— 7% plus inflation, or 10%, whichever is less, every single year. Now, while this is pretty generous and not going to have a huge impact, here is where it is going to impact tenants and landlords. Value-add projects in Washington State are mostly done if a project's under-rented and poorly managed. You cannot take slums and make them nice. Slums will now stay slums. There's nothing you can do about it. You can't make them economically viable anymore. Value-add is more or less out the window on a management standpoint. In addition, families who have larger units, when they have kids move out, say a 4-bed, they usually move down to a 2-bed. That saves some money for them. Well, now the rent's more or less locked in. They're going to stay in a larger unit instead of pay more to downsize, which is going to cause some inventory problems, especially in the larger units, which means for families, anyone who needs a 3, 4, or 5 bed unit, rent's going to go up more or less permanently. It got a little bit less affordable and a little bit harder to find housing. Other than that, it's more or less business as usual. We can still operate our properties, stabilize landlords. We now have rent increases guaranteed to happen every year, like every single state that's tried this. So rough on tenants, stabilized landlords are about to get rich. Value-add is going to get a lot harder.