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The Rental Housing Association of Washington (RHAWA) is suing the City of Seattle over a new law that limits how much a property owner can charge in move-in fees.

Before the ordinance went into effect in January, renters often paid several thousand dollars just to sign a lease, between first and last month’s rent, the security deposit, pet deposit, background check and other fees. Under the new law, Seattle landlords can charge no more than the first month’s rent for a security deposit and move-in fees.

The law was intended to bring relief to tenants already struggling to find housing in an increasingly expensive rental market. Rents citywide have increased more than 40 percent in the last five years. Rent control is illegal in Washington, and the ordinance was seen by many city council members as the next best thing, reports the Seattle Times.   

But RHAWA claims that the ordinance violates the state ban on rent control and takes away people’s property rights. Sean Flynn, the rental-housing association’s president, told the Seattle Times that the laws probably don’t affect huge property owners who have thousands of units. But smaller landlords can’t afford to take on the extra risk that comes with restrictions on charging the fees that they feel are appropriate for their renters. Many end up selling.

“The mom and pops are scared. It’s created havoc,” Flynn told the Seattle Times. “We provide homes for working-class people, and unfortunately this ordinance falls really hard on our membership. It shifts a whole lot of risk back on the landlord and doesn’t allow them to have anything in reserves.”

Flynn asserts that when landlords put their properties on the market, developers move in and turn the property into expensive condos or townhomes, which can’t provide the kind of affordable housing Seattle so desperately needs.

In response, the group Washington Community Action Network issued a statement on Facebook arguing that fee caps have nothing to do with rent control.

“The decision to file a lawsuit over this modest legislation demonstrates that RHAWA doesn’t care if people of color, single moms, seniors, people with disabilities, and low-income families are no longer able to live in this great city,” said Mary Nguyen, executive director.

The lawsuit was filed on Tuesday.

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