Washington state caps rent hikes at 10% through the end of the year

The Washington State Department of Commerce on Friday announced a 10% limit on rent hikes through the end of 2025.

That decision results from Engrossed House Bill 1217, which limits annual rent increases in Washington to 7% plus the consumer price index, or 10%, whichever is less. It also sets a 5% cap for manufactured/mobile home lots.

The Department of Commerce said it would release rent cap information for 2026 this summer based on updated federal inflation data.

EHB 1217 was passed by both chambers of the Legislature during session and signed into law by Gov. Bob Ferguson on May 2.

The controversial rent cap bill drew a passionate response from both supporters and detractors during this year’s session.

Those advocating for EHB 1217 highlighted the benefits of stabilizing rental costs, including making housing more predictable and affordable for tenants. They argued that this would help prevent homelessness and provide a more secure housing environment.

However, opponents expressed concerns that rent caps could discourage new construction and hurt landlords, potentially leading to a worsening housing shortage.

According to the Department of Commerce, Washington must add 1.1 million homes in the next two decades to meet growing demand. This translates to roughly 55,000 new homes needed annually.