A builder can file plans for a twelve-unit building three hundred feet from your house, and depending on where you live, there is now a real chance you hear nothing about it until the excavator shows up.
That is not a warning about something the Legislature is considering. It went into effect on July 1.
Quick note before we go further. I’m a licensed Oregon Principal Broker, not a land use attorney. This is how the rules work in practice, not legal advice, and if you have an application pending right now or you are trying to fight one, call an attorney this week rather than reading a blog post about it.
As of July 1, 2026, Oregon House Bill 4037 changed how cities handle housing applications that meet clear and objective standards. On that track, a city may notify only owners within 100 feet of the site, or 500 feet for projects of 20 units or more. It may not require a public hearing. And only the applicant may appeal the decision.
Jenny walked through the whole 2026 session on video, including the two growth boundary bills and the inclusionary zoning trade that nobody is covering accurately. If you want the full picture, her breakdown of all four bills is worth the time. What follows here is the one piece that changes ordinary life for people who already own a house.
What exactly changed on July 1?
Section 17 of HB 4037 rewrote ORS 197A.400, the statute that requires cities to apply clear and objective standards to housing. Clear and objective means measurable. Height in feet. Setbacks in feet. Units per acre. It is the opposite of a standard like “compatible with neighborhood character,” which is a judgment call and therefore something a neighbor can argue about.
For applications running on that measurable track, three things moved at once.
| Before July 1, 2026 | Now, on the clear and objective track | |
|---|---|---|
| Who gets notice | Set by local code, and cities were free to notify more widely than the state minimum | Owners of record within 100 feet, or 500 feet for 20 or more units, and no further |
| Public hearing | Local government could require one | Local government may not require one |
| Who can appeal | Anyone who appeared and had standing | Only the applicant, locally and at the state land use board |
Read that middle row carefully, because the softer version circulating in the coverage is weaker than the statute. It does not say a city is no longer required to hold a hearing. It says the local government may not require one. That is a prohibition, not permission.
There is a second-order effect nobody is talking about. Notice goes to owners of record. If you rent an apartment near a proposed project, the notice goes to your landlord, not to you.
Does this apply everywhere in Portland?
No, and this is the part I have not seen explained anywhere.
The new limits hang off subsection (1) of the statute, and subsection (2) carves two things out of subsection (1) entirely. The first is residential development in an area identified in a formally adopted central city plan, or in a regional center as Metro defines that term, in a city of 500,000 or more. The second is residential development in historic areas designated for protection under the statewide goal covering historic resources.
Portland is the only Oregon city over 500,000, so that first carve-out applies to Portland and nowhere else. Its Central City plan area, its Gateway regional center, and its protected historic districts sit outside all of this. Own in one of those and your notice and appeal rights did not change on July 1. Own in Beaverton, Gresham, Hillsboro, Milwaukie, or most of Portland outside those areas and they did.
Note what that does to the Metro regional centers outside Portland. Downtown Beaverton, downtown Gresham, and Hillsboro’s regional center are regional centers as Metro defines them, but they are not in a city of 500,000 or more, so the carve-out does not reach them. Same designation, different outcome, purely because of the city they sit in.
That is an uncomfortable amount of geographic precision to carry around, which is the honest reason I would just ask before assuming either way. Rules vary by jurisdiction and by plan designation, and the city-by-city breakdowns we keep for the metro are a reasonable starting point for who governs what.
Can neighbors really not appeal anything now?
Not quite, and the version going around overstates it in two directions.
First, the clear and objective track is the applicant’s choice, not the city’s. The same statute preserves an alternative approval process using criteria that are not clear and objective, and the applicant keeps the option of the measurable route. A builder who wants design flexibility badly enough can take the discretionary path instead, and none of these new limits apply there. So the accurate framing is not “no more appeals in Oregon.” It is “no more third-party appeals on the track the builder picked.”
Second, land use attorneys have flagged that restricting appeals to the state land use board is not the same as closing every courthouse door. The statute speaks to that board specifically. Whether other judicial challenges survive is genuinely untested.
While we are correcting things: you will hear that the old system let a single opponent tie up a project for a year or more at the state board. The board itself runs on a clock. It has 77 days to issue a final order once the record comes over, and if it misses that deadline the applicant can go to circuit court to force one. The year-plus delay was never one proceeding. It was the stack, a local appeal and then the board and then possibly the Court of Appeals, each with its own clock, one after another. HB 4037 did not speed the board up. It removed most of the stack.
Is anyone fighting this?
Sherwood is, and it is the most interesting standoff in Oregon land use right now.
In January, Sherwood voters amended the city charter, by a margin north of 90 percent, to require at least one public hearing whenever a major new residential development is proposed. Two months later the Legislature passed a statute saying cities may not require exactly that hearing. Home rule against state preemption, with housing in the middle.
Six months on, nothing has resolved, because nothing has tested it. As of the start of August, Sherwood had received no land use or annexation application subject to the amendments, and the city has not changed its ordinances. Mayor Tim Rosener’s read is that a builder is unlikely to pick the fight, because challenging the city would only delay the builder’s own project. He also makes a structural point worth sitting with: the state used to set a notice floor that cities could exceed, and now it sets a ceiling they cannot.
So the honest answer is that nobody knows how this resolves until a project tests it and a court rules. Four weeks of a statute is no case law, and neither is four months.
What should I actually do about it?
If you are buying, the calculation on what sits next to a house has changed. A vacant lot, an oversized lot, a tired house on a corner, any of those now carry less warning than they did a year ago. Look at the zoning, not just the view. Small multi-unit projects and accessory dwelling units on close-in Portland lots are exactly the kind of thing that moves fastest under this.
If you are selling and your zoning allows small multi-unit development, your realistic buyer pool may now include builders who are more confident about timelines than they were a year ago. That is worth knowing before you price. Ask your agent to check your zoning specifically, because it varies block to block in a way that surprises people.
If you already own and you are simply annoyed by all this, the practical move is unglamorous: know your zoning and your neighbors’ zoning before something is filed rather than after, since the notice that used to arrive may not. And if you are heading into a transaction, the Oregon-specific rules we get asked about most are worth a read alongside this.
I am not going to tell you whether this is good policy. Oregon has a real housing shortage and process friction is a real part of it. I will tell you that the trade was made, that it was made quickly, and that most homeowners have no idea it happened.
The other three bills out of this session are a different story, and one of them cuts against the headline in a way almost nobody has reported. Jenny covers all of it on video, bill by bill.
If you want to think through what any of this means for a specific property, that is the conversation we are built for. No pressure and no assumption you are buying or selling anything.
Sources: Enrolled House Bill 4037 (2026), sections 17 and 18, amending ORS 197A.400 and setting the July 1, 2026 operative date; ORS 197.830(14), the 77-day deadline and mandamus remedy; Sherwood Sun, “Sherwood’s Home Rule: What changed after Salem stepped in,” August 1, 2026. The new subsections (5) and (6) of ORS 197A.400 were created by HB 4037 and do not yet appear in the published ORS, which runs through the 2024 session, so the bill is cited rather than the statute. This article is general information from a licensed Oregon real estate broker and is not legal advice. For advice on your situation, consult a land use attorney. Lovejoy Real Estate is a member of RMLS and WVMLS.