Renewal is in, but renters are out
• Longtime residents have few options as rents balloon in Interstate corridor
Those nickel-and-dime rent increases Ñ $10 here, $25 there Ñ are becoming a thing of the past in parts of North and Northeast Portland.
In one extreme example, a North Portland couple recently experienced a $390 hike in their monthly rent, an amount they say will force them to leave their home of 13 years.
'Increases of this amount are not targeted at rising incomes or inflation,' said Tom‡s Gardu–o of Community Alliance of Tenants, a grass-roots tenants' rights organization. 'They're basically sending a message to renters that it's time for them to go.'
Nowadays, rent hikes of about $100 and more are not uncommon within 10 neighborhoods associated with the Interstate Corridor Urban Renewal Area, according to the tenants' group and other members of the Interstate Alliance to End Displacement.
The economic investment, the groups say, has achieved the community's worst fears Ñ exacerbating already rising property values and forcing out moderate- to low-income families from the area between St. Johns and the Rose Quarter.
Dorothy and Robert Hatchett never thought they would get priced out of their three-bedroom duplex in the Boise neighborhood, where they have lived for 13 years.
But the new owner of their duplex increased their rent from $600 to $990 a month. The Hatchetts had the first option to buy the duplex, but they said the $270,000 selling price was beyond their means.
Now they are being forced to move, something they wouldn't have considered at this stage of their lives. They live on a fixed income: Dorothy is retired; Robert works as a parking attendant. They have little in savings.
'We're in a bad situation,' Dorothy Hatchett said. 'Our option now is to try to get a lender to loan us money to buy a house Ñ so we're praying that we'll be able to pay the rent until I can find a new place.'
Landlord Nicole Thorburn, who lives nearby in North Portland, said she and her husband, Mat, purchased the house in January for $269,000.
'We don't want them to move out. But we had no choice (but to raise the rent). ... It went to $990 because we are covering the mortgage, insurance, taxes, garbage and the water bill. All we are doing is covering our expenses.'
The Hatchetts' predicament shows the extent to which market forces can wreak havoc on renters.
Typically, rent hikes in the Portland area have ranged between 3 percent and 5 percent in the past five years, according to a number of property management companies. With the onset of the recession, however, they've dropped to between 2.5 percent and 3 percent.
'Portland doesn't have dramatic rent increases like in the Bay Area or in Seattle,' said Robert Black, a senior marketing consultant at Norris Beggs & Simpson, which manages buildings of 100 or more units in the Portland and Vancouver, Wash., area. 'It's a pretty stable market.'
In fact, Black said, his company's surveys show that overall rents are starting to drop because low interest rates are encouraging more people to buy homes.
A market adjustment
Dramatic rent increases along the lines that the Hatchetts experienced tend to be symptomatic in areas and in properties that haven't kept current with market conditions.
'Rents in North-Northeast Portland have been relatively low compared with the rest of the market because it was a deteriorated area with higher crime,' said Craig McConachie of C&R Realty, a property management group that oversees about 5,000 apartment units.
'Now property values have gone up significantly,' he said. 'What you're seeing now, on a percentage basis, are higher rent increases.'
But Michael Anderson, enforcement director at the Fair Housing Council of Oregon, describes the situation in North and Northeast Portland as one that should be discussed in terms of civil rights because many people of color traditionally have lived in the area.
'Prejudice kept prices artificially low there for years,' he said. 'When financial opportunities became too good to pass up, people were willing to get over their prejudices to make a buck.'
A recent survey sponsored by the city's Bureau of Housing and Community Development showed that more than one-third of renters and one-fifth of homeowners interviewed in the urban renewal area were concerned about being priced out of their homes.
Residents at risk
The housing bureau is expected to complete its final analysis of the survey data next month. Results will be used to shape housing strategy within the urban renewal area, the largest redevelopment project ever undertaken by the city.
The Interstate Alliance to End Displacement, an outgrowth of a city-funded group of grass-roots organizations, has proposed some strategies to help residents at risk of losing their homes.
The alliance suggests that city leaders provide rental assistance for people like the Hatchetts. It also suggests rehabilitation loans for so-called 'mom and pop' landlords who are trying to keep their units affordable as well as assistance for longtime homeowners and ongoing outreach and education about displacement.