By Thaddaeus Elliott, NLIHC Housing Advocacy Organizer
On May 7, 2025, Washington Governor Bob Ferguson signed House Bill 1217 into law. This makes Washington the third state after California (passed in 2019) and Oregon (passed in 2019, updated in 2023) to institute statewide rent stabilization.
Under the new law, annual residential rent increases are capped at 7% plus the Consumer Price Index (CPI) or 10%, whichever is lower. This cap applies to apartments and single-family homes with the following exempt: subsidized housing owned by nonprofits and public housing authorities, homes built by low-income housing tax credits regulated by the Washington State Housing Finance Commission, and duplexes through fourplexes where the owner lives onsite. For manufactured homeowners, rent increases are capped at 5% annually. Newly built homes are exempt from rent stabilization for the first 12 years, and caps for residential tenants end after 15 years. Rent increases for manufactured homeowners are capped at 5% per year. This cap does not expire.
The road to the final version of this bill and a landmark win for renters in Washington State was tumultuous. Previous legislation to cap rent increases to 7% had been introduced in each of the previous two sessions and failed to progress through the state legislature both times. Last year, opponents to the measure claimed that capping rent increases could discourage construction of new rental housing and place greater economic strain on struggling landlords. However, polling going into the 2025 legislative session showed that the vast majority of Washington voters supported a bill to limit “excessive rent increases or excessive move-in and late fees.”
The high level of support is reflective of the severe housing affordability crisis in the state. Nearly 40% of the state’s residents are renters, with 21% of renters being extremely low-income (ELI), earning 30% of area median income. Washington has one of the largest gaps between wages and rent with Fair Market Rent (FMR) for a one-bedroom home at $1,756 per month. The rent affordable to an ELI household in the state is $911/month. Of ELI renters, 77% are severely cost-burdened, spending over half of their income on housing. In a review of census data, NLIHC state partner, the Washington Low Income Housing Alliance (WLIHA), found that 47% of renter households in Washington saw their rent increase over $100/month in 2024, with 15% seeing an increase over $250/month. A 2020 U.S. Government Accountability Office study found that every $100 increase in rent leads to a 9% increase in homelessness. In 2024, Washington state had it’s highest eviction filing count in its recorded history.
Key provisions of the original version of the bill were a rent cap—including fees—of up to 7% annually, a cap of all move-in fees to the equivalent of one-month’s rent, and late fees to 1.5% of the tenant’s total monthly rent. It also included a provision that prevents landlords from treating month-to-month leases differently than fixed-term leases in terms of rent levels and fees, to end the practice of landlords charging “month-to-month fees” or much higher rents to compel renters to sign fixed-term leases, which are exempt from Washington’s just cause eviction protections. It also originally exempted new construction for the first 10 years.
The bill passed the House in March, but advocates were dealt a major setback when the Senate approved the bill with two detrimental floor amendments: (1) the rent increase cap raised to 10% plus CPI and (2) single-family homes were exempt from any limits to annual rent increases. The Senate Ways and Means made an additional amendment that extended the exemption for new construction from 10 to 15 years. Michele Thomas, Director of Policy and Advocacy at WLIHA, commented in response to these changes, “Excessive rent increases threaten people with evictions, displacement, and homelessness. Rents across the state are out of reach and every rent increase causes more instability. The 7% in the bill was already a compromise, with many renters telling us it was the highest they could afford. Because the conference committee bill significantly raises the cap above 7%, we are afraid that it will not result in the stability that we fought for.”
Advocates did not give up the fight and mobilized to pass the bill in the final days of the legislative session. This included a rally at the state capitol in Olympia on April 18 attended by over 100 advocates from across the state, sign-on letters and written messages from constituents to their state delegates, as well as a phone banking drive. The bill in its final form was passed on April 27, the last day of the legislative session. Other wins in the legislative session include $605 million for the state Housing Trust Fund, plus an additional $9 million for youth and young adult projects in the final capital budget. The operating budget also fully funds the Housing and Essential Needs rental assistance program, funds the operation of permanent supportive housing, increases funding for right to counsel, and fills a funding gap in homelessness services.
“While not everything we wanted,” commented WLIHA executive director, Rachael Myers, in a message to their network, “this [legislation] will provide predictability and protection from rent gouging for tenants all across Washington. Passage of this bill represents an important step forward toward housing justice and gives us a strong foundation to further improve tenant protections in the future.” NLIHC applauds our Washington state partner, Washington Low Income Housing Alliance and their network for mobilizing over 5,700 individuals across the state who sent over 40,700 messages to their legislators to make these important wins possible.