Washington Enacts Statewide Rent Control: Key Rules Now in Effect

On May 7, 2025, Washington Governor Bob Ferguson signed House Bill 1217 (HB 1217) into law, establishing statewide residential rent control measures, effective immediately. The legislation limits annual rent increases, requires that landlords provide parity in rent for different lease types (month-to-month v. fixed term), and lengthens statewide notice requirements for rent increases from 60 to 90 days.

The legislature exempted certain tenancies from the rent restrictions, including tenancies in new construction for a period of 12 years from certificate of occupancy. It is hard to know whether this apparent attempt to mitigate impacts on the multifamily development pipeline will provide an adequate window to recover upfront investments.  It is possible this legislation could impact long-term projections of property values.

This law makes Washington the third state to implement statewide rent control policies, along with Oregon and California. Most provisions in HB 1217 expire after 15 years on July 1, 2040. The rental caps on mobile and manufactured homes do not have an expiration date.

Implications for Landlords and Property Owners

• Compliance Requirements: Landlords must adhere to the new rent increase caps and notice requirements. Failure to comply may result in legal action and potential damages.
• Exemptions: Landlords owning properties that fall under the exempt categories (new construction, owner-occupied units, nonprofit-owned properties) are not subject to the rent increase limitations but should ensure compliance with the requirements for claiming exemptions as outlined in HB 1217.
• Legal Considerations: Landlords should review existing lease agreements and practices to ensure alignment with the new legal framework.

Key Provisions of HB 1217

1. Restrictions on Rental Amounts
   1. Annual Rent Increase Cap and Notice Requirements.

      HB 1217 imposes a cap on annual rent increases for most residential tenants, which is set forth in the newly created Section 101 of chapter 59.18 RCW. Under the new law, landlords may not increase rent during the first year of tenancy. This restriction applies regardless of whether the tenancy is month-to-month or for a fixed term.

      Following the first year of tenancy, landlords may not increase rent by more than 7% plus the consumer price index, or 10%, whichever is less, in any 12-month period. On June 1 of each year, the Washington Department of Commerce will publish annual calculations of the maximum increase allowable under law using the June 12-month percent change in the consumer price index for All Urban Consumers, All Items, for the Seattle area. The rent cap for manufactured and mobile homes is lower, at 5%. The limits do not apply to rental adjustments after a tenant vacates a dwelling unit.

      Prior to implementing rent increases, landlords must provide tenants with at least 90 days’ notice (or longer if required by city code) – an increase from the prior requirement of 60 days’ notice. HB 1217 provides specific language that landlords must use when sending rent increase notices.

   2. Rental Parity in Lease Types.

      HB 1217 requires that landlords provide rental parity between lease types for a specific dwelling unit. This means a landlord may not charge more than a 5% percent difference in rent depending on the type of lease, regardless of whether the type is month-to-month or for a longer fixed term.

2. Exemptions to Rent Restrictions

   Certain types of tenancies are exempt from the rent increase limitations. A landlord wishing to claim one of the exemptions must include specific facts and documents supporting the basis for the claimed exemption in its written notice of the rent increase.

   The full list of exemptions is set forth in the newly created Section 102 of chapter 59.18 RCW and includes tenancies in the following types of properties:

   • New Construction: Residential buildings for a period of 12 years following issuance of the first certificate of occupancy for the applicable dwelling unit. The reference to the “first” certificate of occupancy suggests the legislature did not intend for this exemption to extend to rehabilitated or renovated buildings.
   • Owner-Occupied Units: Triplexes or fourplexes where the owner occupies one of the units, so long as the property is not owned by a corporation or certain similar entity types.
   • Low-Income Housing Tax Credit (LIHTC) Projects: Properties which have received Section 42 tax credits that are currently subject to an enforceable regulatory agreement.
   • Nonprofit-Owned Affordable Housing: Properties owned and operated by nonprofit organizations that provide affordable housing.
3. Tenant Protections

   HB 1217 provides tenants with defenses against eviction if the action is based on nonpayment of unlawfully increased rent or fees. In the event a landlord increases rent above the amount allowed and the increase is not authorized by an exemption, the tenant must offer the landlord an opportunity to cure the unauthorized increase by providing the landlord with a written demand to reduce the increase to an amount that complies. In addition, the tenant may terminate the rental agreement at any time prior to the effective date of the increase by providing the landlord with written notice at least 20 days before terminating the rental agreement.

4. Enforcement and Legal Recourse

   The bill authorizes the Attorney General to enforce its provisions under the Consumer Protection Act. Tenants are also granted a private cause of action to seek damages if their rights under the bill are violated. These enforcement mechanisms aim to ensure compliance and provide tenants with avenues for redress.

   The following penalties may apply to any noncompliance:

   • Damages in the amount of any excess rent, fees, or other costs paid by the tenant.
   • Damages in an amount of up to three months of any unlawful rent, fees, or other costs charged by the landlord.
   • Reasonable attorneys’ fees and costs incurred in bringing an action for noncompliance.
   • Civil penalties of up to $7,500 for each violation.