Washington Rent Cap 2027: What 10% Means for Landlords
Washington's maximum rent increase for 2027 is 10%, up from 9.683% in 2026. The Department of Commerce published the 2027 figure on July 15, 2026. It applies to residential tenancies that aren't exempt, it limits increases across any 12-month period, and it sits on top of two other rules: no increase at all during a tenancy's first 12 months, and at least 90 days' written notice before any increase. If you own a rental, are about to buy one, or are deciding whether to rent first, the percentage is the least important of the three questions you need to answer.
I filmed the video below while 9.683% was the number everyone quoted, and it's still right for increases through December 31, 2026. But with a 90-day notice clock, any notice served from early October on lands in 2027. So this post carries the current figure, the rules that move money, and what the cap means when you buy, own or sell a rental in Kitsap, Pierce or Mason County.
Key Takeaways
- The 2027 cap is 10%. Commerce's formula (7% plus Seattle-area inflation) came out to 11.53%, so the 10% ceiling applies for January 1 through December 31, 2027.
- The cap only covers tenancies that aren't exempt. Units with a first certificate of occupancy 12 or fewer years before the notice, certain affordable housing, and some owner-occupied rentals are outside it.
- No increase in the first 12 months of a covered tenancy, whether it's month-to-month or a fixed term.
- 90 days' written notice is the statewide minimum, on a form substantially like the one in the statute, and the increase can't take effect before the lease term ends.
- When a tenant moves out, the rent resets. The statute lets a landlord set the next rent at any amount, which matters a lot to how a rental is valued.
- The cap is a ceiling, not a forecast. Underwrite a rental on what the market will pay and what the in-place lease allows, not on 10% a year.
The 2027 Number Is 10%, Not 9.683%
House Bill 1217 took effect on May 7, 2025, and its core rule is codified at RCW 59.18.700. The formula is simple: a landlord may raise rent on a covered tenancy by no more than 7% plus the consumer price index, or 10%, whichever is less, in any 12-month period.
The CPI piece is the June-over-June change in the Bureau of Labor Statistics' Seattle-area consumer price index for all urban consumers. Commerce runs the math each summer and posts the limit for the next calendar year.
How each year's limit was set
| Period | Seattle-area CPI change (June to June) | 7% plus CPI | Maximum increase |
|---|---|---|---|
| May 7 to December 31, 2025 | Not published | Not published | 10% |
| January 1 to December 31, 2026 | 2.683% | 9.683% | 9.683% |
| January 1 to December 31, 2027 | 4.53% | 11.53% | 10% |
For 2026, the index went from 354.824 in June 2024 to 364.344 in June 2025, which put the limit at 9.683%. For 2027, it went from 364.344 to 380.849, which put the formula at 11.53%. That's above the ceiling, so 10% is the number.
Source: Washington State Department of Commerce, HB 1217 Landlord Resource Center, and its July 2025 announcement of the 2026 limit.
See the numbers
| Item | Value |
|---|---|
| 2025 (from May 7) | 10% |
| 2026 | 9.683% |
| 2027 | 10% |
What that change means in practice
In the video I warned people not to treat 9.683% as next year's number. The limit did change, upward. A landlord sending a notice today for a 2027 effective date is working with 10%. And 10% is the most the formula can ever produce under current law, so "under 10% forever" was never accurate.
The law also has an end date. RCW 59.18.700 and the exemption section both say they expire July 1, 2040. (If you heard 2024 in the video, the statute's date is 2040.) That's the current statute, not a promise. The Legislature can change it before then.
Does the Cap Even Cover This Rental
This is the question people skip, and it's the one that decides everything else. The cap doesn't apply to every rental in Washington. RCW 59.18.710 lists the tenancies that are outside it.
The exemptions that come up most in our three counties
| Exemption | Who it usually covers | The detail that trips people up |
|---|---|---|
| Newer construction | Units whose first certificate of occupancy was issued 12 or fewer years before the date of the rent increase notice | It's a rolling window. A building ages out of the exemption one notice at a time. |
| Shared kitchen or bath with the owner | A room rented in the owner's own home | The owner has to keep their principal residence there. |
| Owner-occupied single-family home | The owner lives there and rents no more than two units or bedrooms, including an ADU | "Small landlord" isn't the test. Living there is. |
| Owner-occupied duplex, triplex or fourplex | The owner lived in one unit when the tenancy began | The exemption lasts only as long as the owner keeps living there. |
| Regulated affordable housing | Housing authorities, public development authorities, qualifying nonprofits and tax-credit properties | Maximum rents are already limited by other rules. |
The ownership trap for investors
If you're buying a small multifamily property to live in one unit, underline this. The three owner-occupied exemptions don't apply if the owner is a real estate investment trust, a corporation, or an LLC with at least one corporate member. Holding the property in the wrong structure can quietly put a tenancy back under the cap.
If you claim an exemption, you have to show your work
A landlord who raises rent above the limit because of an exemption has to include the facts supporting it in the written notice. The statutory form has a checkbox for each exemption, each requiring facts or attached documents. A notice that just says "exempt" isn't doing the job.
For the newer-construction exemption, the fact that matters is the date of the first certificate of occupancy. That's a public record, and I'd pull it before buying any building marketed on its rent upside. My public records checklist for Washington homes covers where to find it.
Manufactured home lots have their own, lower cap
Lots in manufactured or mobile home communities fall under a different chapter. Under RCW 59.20.370, lot rent can't go up in the first 12 months of the tenancy, then can rise no more than 5% in any 12-month period. That section carries no 2040 end date. The landlord has to give three months' written notice under RCW 59.20.090, and the exemptions under RCW 59.20.380 are much narrower, mostly lots owned by housing authorities, public development authorities and qualifying nonprofits.
If you're selling a manufactured home on a rented lot, know this: when the rental agreement transfers to your buyer, the park can take a one-time increase of any size at the first renewal, as long as it told the buyer before the transfer.
The Math on a Real Rent
Once you know a tenancy is covered, the arithmetic is easy. The example I used in the video was a $2,000 rent with no earlier increases in the same 12-month window.
What the cap allows at a few common rents
| Current monthly rent | Maximum increase at 9.683% (2026) | New rent | Maximum increase at 10% (2027) | New rent |
|---|---|---|---|---|
| $1,800 | $174.29 | $1,974.29 | $180.00 | $1,980.00 |
| $2,000 | $193.66 | $2,193.66 | $200.00 | $2,200.00 |
| $2,500 | $242.07 | $2,742.07 | $250.00 | $2,750.00 |
That's my arithmetic on the published percentages, not a recommendation. A maximum isn't an automatic increase, and nothing in the law requires a landlord to raise rent at all.
It's a 12-month window, not a January reset
The limit applies across any 12-month period. It isn't a fresh allowance that refreshes every January 1. If a covered tenant already had an increase in the last 12 months, that increase counts against the limit. A landlord can't stack a December increase and a February increase and call each one legal on its own.
"Fees" count too
The statute and its notice form treat rent as including all recurring and periodic charges for use and occupancy listed in the rental agreement. Renaming part of the rent a "fee" doesn't move it outside the cap. If a seller has layered on parking, storage or utility charges, underwrite the whole recurring number.
The Notice Rules Landlords Get Wrong
The percentage gets the headlines. The notice is where landlords actually get into trouble.
90 days, in writing, on the right form
Under RCW 59.18.140, a landlord has to give at least 90 days' prior written notice of a rent increase, up from 60 before HB 1217. The increase can't take effect before the current rental agreement's term ends. The notice has to be substantially in the form printed in RCW 59.18.720, and it has to be served the way RCW 59.12.040 requires. A text saying "rent's going up" isn't a notice.
There's one carve-out. For a subsidized tenancy where rent is based on the tenant's income or household circumstances, the minimum is 30 days. For the notice-form rule in RCW 59.18.720, a tenancy paid with a portable voucher doesn't count as subsidized, so it still gets the standard form.
Local rules can be longer
The state's 90 days is a floor. As I mention in the video, Seattle requires 180 days. Seattle also requires a relocation-assistance notice when increases reach 10% within 12 months, which a full 2027 increase would hit. Closer to home, Tacoma moved to 180 days' notice on January 1, 2026, under its Rental Housing Code (TMC 1.95.060). Check the city's rules before you assume 90 days covers you.
Exempt doesn't mean notice-free
A tenancy that's exempt from the percentage cap is still subject to the 90-day notice rule. The cap, the exemption and the notice are three separate questions. Answer all three before anything goes out the door.
Two smaller rules that still move money
Late fees: under RCW 59.18.170, a landlord can't charge a late fee for rent paid within five days of the due date. That isn't a five-day extension of the due date. Rent due on the first is still due on the first.
Lease-type pricing: under RCW 59.18.700, a landlord can't charge more than a 5% difference in rent for the same unit depending on whether the tenant picks month-to-month or a fixed term. That 5% difference also can't push the rent above the increase limit. Compare the actual terms, not just the monthly number.
What Happens When an Increase Breaks the Rules
This is for owners as much as tenants. A sloppy notice can cost more than the increase was worth.
The tenant's first step is a written demand
If a landlord raises rent above the limit without a valid exemption, the tenant has to give the landlord a chance to fix it, by sending a written demand to bring the increase down to a lawful amount. A phone call can clear up a misunderstanding, but it isn't the step the statute describes.
The tenant can also end the rental agreement before the increase takes effect, with at least 20 days' written notice, owing rent for the month they move out and no termination fees.
What a court can award
| Remedy | Who gets it |
|---|---|
| Any excess rent, fees or other costs the tenant paid | The tenant |
| Up to three months of the unlawful rent, fees or costs | The tenant |
| Reasonable attorneys' fees and costs | The tenant, or the Attorney General, whoever brings the action |
| Civil penalties of up to $7,500 per violation | The state, in an action by the Attorney General |
A landlord also can't report a tenant to a screening service for refusing to pay the unlawfully increased portion. And the Attorney General doesn't have to wait for the tenant's cure demand before acting.
For a landlord, the cheapest fix is a correct notice the first time.
Buying a Rental in Kitsap Under the Cap
This is where the law turns into money.
Underwrite the lease you're inheriting
When you buy an occupied rental, you inherit the tenancy. If it's covered, rent growth is limited by the percentage, the 12-month window, and a 90-day notice that can't land before the lease term ends. A pro forma that jumps rent 20% in year one on a covered tenancy isn't a plan.
Before you write the offer, get:
- Every current lease, with start dates and terms.
- The rent history, including the date and size of the last increase, because it counts against the next 12 months.
- Any exemption the seller claims, and the documents behind it.
- All recurring charges, not just base rent.
Vacancy is the reset button
The statute lets a landlord adjust rent by any amount after a tenant vacates and the tenancy ends. So setting rent for a new tenancy and raising rent on an existing one are two different analyses. The market still decides what a new tenant will pay, but a vacant property and an occupied one at the same price can be very different investments.
The carrying cost doesn't care about the cap
The cap limits what you can collect. It does nothing to what you owe. At the Freddie Mac 30-year average of 7.32% as of October 22, 2026, principal and interest on a home at Kitsap County's September median sale price of $595,000 (NWMLS), with 20% down, comes to about $3,270 a month. That's my arithmetic, before taxes, insurance and maintenance.
If the in-place rent doesn't come close to that carry, the cap tells you how slowly the gap can close. And don't underwrite lower turnover just because increases are predictable now. My guide to what your budget buys in Kitsap shows the same payment math at other price points.
If you're selling one investment property to buy another, the tax side matters as much as the rent side. What a 1031 exchange attorney told me about avoiding costly mistakes is worth reading before you list.
Selling a Rental: How the Cap Shapes Your Buyer Pool
If you own a rental in Kitsap and you're thinking about selling, the cap is now part of how buyers will price your property. This part is my read of the market, not something the statute spells out.
Occupied versus vacant
An investor buying your occupied rental is buying your tenant's lease and its limits. If the in-place rent is well under market and the tenancy is covered, that buyer can only close the gap gradually, and will price that in.
A vacant home, or one where the tenant is leaving on schedule under the lease, opens the door to investors who can set a new rent and owner-occupants who just want a house. A wider pool usually means a stronger price. How you get to vacant has to follow the lease and the law, so talk to an attorney before you change anything with a tenant.
Get the paperwork ready before you list
Leases, rent history, the last increase notice and proof of any exemption are what a smart buyer will ask for. A messy file is a reason to discount.
Pricing a rental is its own exercise. My notes on pricing your Kitsap home in 2026 cover the owner-occupied side. For a real number on your property, tenant situation included, ask me for a valuation. I price it myself against the homes that actually compare, not with an automated estimate.
Rent First or Buy Right Away
I get this question constantly. The cap makes one part of a rental budget more predictable, for a covered tenancy. That can support a rent-first plan while you learn the area. It doesn't make renting first the automatic answer.
What the first-year rule really protects
For a covered tenancy, the landlord can't raise rent during the first 12 months, whether you sign month-to-month or a fixed term. That's the first year of the tenancy, not your first year in Washington, and a renewal lease doesn't automatically restart the clock. A newer complex, or a room or ADU in an owner's home, may be exempt, so ask the landlord whether the unit is covered, and why.
Run both numbers
If you start a lease late this year, your first anniversary lands in 2027, when the limit is 10%. On a $2,000 rent that's up to $200 a month more in year two. Compare that against buying now. If you're a first-time buyer, check the Washington first-time buyer programs before you decide you can't buy yet.
Your timeline, commute, finances and the actual rent matter more than the cap.
What Is Washington's Maximum Rent Increase for 2027?
Washington's maximum rent increase for 2027 is 10%, published by the Department of Commerce for January 1 through December 31, 2027. The formula of 7% plus the June-to-June change in the Seattle-area consumer price index came out to 11.53%, so the 10% ceiling applies. The 2026 limit is 9.683%. Both apply only to tenancies not exempt under RCW 59.18.710.
Can a Landlord Raise Rent in the First Year of a Lease in Washington?
No, not for a tenancy covered by the rent cap. Under RCW 59.18.700, a landlord may not increase rent during the first 12 months after a tenancy begins, whether the tenancy is month-to-month or for a fixed term. Exempt tenancies, such as newer construction or certain owner-occupied rentals, aren't covered. After 12 months, increases are limited to the published annual percentage.
Are New Buildings Exempt From Washington's Rent Cap?
Yes. A unit whose first certificate of occupancy was issued 12 or fewer years before the date of the rent increase notice is exempt from the percentage cap. The window rolls forward, so a building eventually ages into the cap. A landlord claiming the exemption must include the certificate date and supporting facts in the notice, and the 90-day notice requirement still applies.
How Much Notice Does a Washington Landlord Need to Raise Rent?
At least 90 days' prior written notice, under RCW 59.18.140, and the increase can't take effect before the current lease term ends. The notice must be substantially in the statutory form and served as RCW 59.12.040 requires. Subsidized tenancies with income-based rent need 30 days. Some cities require more, so check local rules for the property.
Final Thoughts
For 2027 the most a landlord can raise rent on a covered tenancy is 10%, not 9.683%. But the percentage was never the whole rule. Check the tenancy, check the exemption, check the notice, then check the math.
If you own or are buying a rental, treat the cap as a limit, not a growth forecast. The in-place lease, the rent history and the vacancy reset matter more to value than the annual number, and your buyers will do that same math.
This post cites Washington statutes (RCW 59.18.140, 59.18.170, 59.18.700, 59.18.710, 59.18.720, 59.20.090, 59.20.370 and 59.20.380) as they read in October 2026, Department of Commerce rent limits, and Seattle and Tacoma notice rules as the cities publish them. The Kitsap median is from the NWMLS residential Local Market Update for September 2026. Information and statistics compiled and reported by the Northwest Multiple Listing Service. The rate is the Freddie Mac PMMS average as of October 22, 2026, and changes weekly. Dollar figures are my arithmetic. This isn't legal, tax or financial advice. For a specific notice or dispute, talk to a Washington landlord-tenant attorney, and confirm current rules with Commerce and the Attorney General's office.
Buying, holding or selling a rental?
Tell me what you own or what you're looking at, and I'll walk you through how the tenant situation changes the price, from either side of the table. Book a no-pressure call or reach me at (360) 777-7212.
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