The Mayor Rewrote Chicago's Rental Ordinance Last Week. Whether It Touches Your Building May Now Come Down to Whether You Live in It.
The Protecting Renters Ordinance got a rewrite on September 4. Relocation payments came down, a six-unit exemption went in, and the whole thing needs to clear committee on September 16 to make a full Council vote on September 23. If you own a two-flat, a six-flat, or anything above one, the line the city just drew runs right through your building.
Chicago's rental law was written in 1986. Harold Washington was mayor. Ditka was coaching. Nobody had heard of a "move-in fee" because nobody had invented one yet.
Forty years later, the city is finally rewriting it, and this month is when it either happens or doesn't. I walked through the two competing bills back in August. Since then the mayor's office has quietly rewritten its own version, and the changes are aimed squarely at the people who own most of Chicago's rental housing: small owners with a handful of units.
Here's what changed, what didn't, and the one sentence in the reporting that every small building owner in this city should be reading twice.
The four things that changed on September 4
The mayor's office circulated a revised Protecting Renters Ordinance — PRO — to alderpeople during the week City Council returned from its August recess. Jung Yoon, the mayor's chief of policy, described the changes as a response to specific concerns raised by small landlords and industry groups. Per Block Club Chicago's reporting:
A six-unit exemption. Small landlords with six or fewer units are now exempted from several of the ordinance's provisions, including just cause for eviction and the relocation assistance requirements.
Relocation payments came down. Assistance was reduced to $4,000 for certain no-fault situations — an owner planning to move into a unit, or substantial repairs — and $7,500 in other qualifying cases. Earlier versions ran up to $5,000 or $10,000, or a set number of months' rent.
A first-year grace period. Landlords would be exempt from relocation assistance during a tenant's first year, which Yoon described as a runway before the just-cause protections kick in.
More notice on utility billing changes, including ratio utility billing systems (RUBS), plus clarified anti-retaliation language covering tenant speech on social media.
The sentence worth reading twice
Here is where it gets important, and where I'd tell you not to take anybody's summary — including mine — as the last word.
Different outlets have described the six-unit line two different ways.
Block Club reported that landlords with more than six units would have to provide relocation assistance in no-fault situations. Read plainly, that's a size test: six or fewer units, you're out of it, full stop.
Crain's and The Real Deal have described the exemption as applying to owner-occupied buildings with six units or fewer. That's a size test plus a residency test. Under that reading, a non-owner-occupied three-flat — an enormous share of Chicago's rental stock — is still fully covered.
The Neighborhood Building Owners Alliance, which opposes the ordinance, appears to read it the second way. Its statement objected that "the dividing line isn't need, and it isn't affordability" — it's whether the owner happens to live in the building.
That distinction is not a technicality. It decides whether tens of thousands of Chicago buildings are in or out. If you own small rental property in this city, the version of the text your alderperson votes on is the version that matters, and it is worth asking their office for the current draft language rather than relying on a news summary. That includes this one.
What did not change
Several of the provisions landlord groups have objected to loudest are still standing in the revised bill:
Security deposits capped at one month's rent
A ban on move-in fees and other so-called junk fees
A citywide rental registry, with annual registration and tiered per-unit fees
A new Bureau of Rental Housing Services inside the Department of Housing to take complaints, investigate, and enforce
A formal Tenant Bill of Rights
An Eviction Counsel Program making the existing Right to Counsel pilot permanent
Just cause for eviction and lease nonrenewal — for buildings above the exemption line
The city has said PRO's implementation would phase in over 12 to 24 months after passage, and that registry fees are structured to make the system budget-neutral, with the fee tiers scaled by property size.
The relocation math, run on an actual Chicago rent
The original bill tied relocation payments to rent. The revision appears to replace that with flat dollar figures. That sounds like a small drafting change. It isn't.
Chicago's median rent sat at about $2,215 a month in August 2026 per Zumper, up 1.4% year over year. Here's what that does to the numbers for a landlord above the exemption line:
Situation | Original PRO (June) | At $2,215 median rent | Revised PRO (Sept. 4) |
Owner or relative moves in; major repairs; demolition; condo conversion; removal from the rental market | Greater of $5,000 or 5 months' rent | $11,075 | $4,000 |
Other lawful no-fault nonrenewal not on the list | Greater of $10,000 or 10 months' rent | $22,150 | $7,500 |
Owner-occupied 2–6 flat | Greater of $3,000 or 3 months' rent | $6,645 | Exempt from the requirement |
On a median-rent unit, that's roughly a two-thirds cut. On a $2,500 two-bedroom it's steeper still — the five-month calculation would have run $12,500 against a flat $4,000 now.
There's a second-order effect nobody has said much about. A rent-based formula scaled with the building: a Lincoln Park landlord owed more per tenant than a landlord on the far South Side, because the rent was higher. Flat dollar figures don't scale. Under the revision, the same $4,000 applies whether the unit rents for $1,400 or $3,400. Whether that's fairer or less fair depends entirely on which chair you're sitting in, and both sides have a real argument.
One note on the rent figures: the sources disagree on the level. Zumper puts Chicago's median around $2,215 and RentHop puts two-bedrooms near $2,400, while RentCafe shows an average closer to $2,529 — but RentCafe's methodology draws on buildings with 50 or more units, which is precisely the segment that rents highest. The direction is consistent across all three. The level is not, so treat any single number as a starting point rather than gospel.
Why a two-flat owner should care about a bill aimed at corporate landlords
Because in Chicago, small buildings are the rental market.
Research from the Institute for Housing Studies at DePaul puts two-to-four unit buildings at roughly 26% of all residential units in the city. On the rental side, units in 2-to-4 unit buildings were just over 32% of Chicago's rental stock as of 2021 — still the most common rental type in the city, but down from just over 38% in 2012.
That decline is the whole ballgame. IHS found that since 2012, rental units in small 2-to-4 unit properties fell by nearly 12%, while buildings with 50 or more units grew by nearly 28% and mid-sized 5-to-49 unit buildings grew by nearly 19%. Chicago has been steadily trading small, older, unsubsidized rental buildings for large new ones.
And the small ones carry a load the big ones don't. Nearly 40% of rental units in 2-to-4 unit buildings have three or more bedrooms, compared with 14.8% in 5-to-49 unit buildings and 5.9% in buildings over 50 units. If you're a family of five looking to rent in this city, you are almost certainly looking at somebody's two-flat.
Which is why where the exemption line lands is not an accounting question. It's a supply question.
The other bill is still sitting there
PRO isn't running unopposed. A coalition of alderpeople — reported at 16 authors and backed by a larger bloc — introduced the Fair and Accountable Illinois Rental Ordinance (FAIR) in July, led by Ald. Gilbert Villegas (36th). It keeps pieces of PRO, including the registry and the deposit cap, and strips out just cause, relocation assistance, and the Tenant Bill of Rights. It was assigned to the zoning committee rather than housing.
The tenant side considers FAIR a step backward; a Metropolitan Tenants Organization organizer has argued it leaves renters worse off than current law. The landlord side doesn't love it either but treats it as a workable starting point.
Reporting from The Real Deal in early September indicated NBOA leaders were mobilizing members ahead of the debate, with some hoping division on the Council causes both measures to fail — while remaining more open to negotiating on FAIR. An NBOA panelist described PRO as a nonstarter for the industry, primarily over just cause.
What each side is actually arguing
The case for PRO
About 54% of Chicago households rent — roughly 622,000 households — and over 40% of those renters are cost-burdened, spending more than 30% of income on housing. The city's position is that enforcement today is complaint-driven, that tenants rarely have legal representation, and that the city has no reliable data on who owns what. Historical analysis cited by supporters puts Chicago above 22,500 eviction filings a year, with sharp disparities in filing rates across the city. A registry plus a dedicated bureau is meant to fix the data and enforcement gaps at once.
The case against
Housing providers argue the costs don't evaporate — they show up as higher rents, tighter screening, deferred maintenance, and fewer units offered. NBOA's president has framed it simply: you can't make housing cheaper by making it more expensive to provide. The Chicagoland Apartment Association has argued the ordinance imports policies from some of the country's least affordable markets. And the compliance burden itself is a real cost: notice requirements, disclosures, registrations and relocation calculations that all have to be executed correctly and in order, with litigation risk if they aren't.
I'm not going to tell you which of those is right. Both contain claims that are testable and neither has been tested in Chicago yet.
If you own a Chicago rental building right now
Count your units and check the residency question. Six or fewer may or may not be enough on its own. Owner-occupancy may be the deciding factor. Get the actual draft text.
Look at your move-in fee structure now. The fee ban and the one-month deposit cap survived the rewrite. Many owners moved to move-in fees specifically to avoid Chicago's deposit litigation exposure. That door may be closing.
Note that a sale can be a triggering event. Reporting lists the sale of a unit among the no-fault situations that can trigger relocation assistance for covered landlords. If you're planning to sell a building above the line and the buyer wants it delivered vacant, that's now a line item, not an afterthought.
Get your leases and tenant files in order. A registry means somebody will eventually be able to look up what you own. Clean records are cheaper than clean-up.
Don't panic-sell on a draft. This is not law. It phases in over 12 to 24 months if it passes at all.
If you're buying a Chicago rental building this fall
Ask where the building sits relative to the exemption line before you write the offer, not during attorney review.
Get a tenant estoppel — signed statements from each tenant confirming rent, deposit held, lease term, and any side agreements. This matters more, not less, if just cause passes.
Put vacant possession in writing if your plan requires it, and price the possibility of relocation assistance into the deal.
Underwrite the registry fee as an operating expense per unit per year, and assume some compliance overhead.
Watch the small-building math specifically. If the exemption survives as written, an owner-occupied three-flat and an eight-unit building are about to operate under meaningfully different rules. That's a real factor in which one pencils.
If you're buying vacant property to rehab, the state-level squatter and deed-fraud changes stack on top of all of this.
Where this could still go sideways
Everything above describes a draft that has been revised once already and can be revised again on the committee floor. Substitute ordinances in Chicago have a long history of appearing the same morning they pass. The September 16 committee vote and September 23 Council vote are the administration's stated targets, not guarantees — Council calendars slip, and both of these bills have slipped before.
It's also possible neither passes. That is an outcome some organized opponents are openly working toward, and with two competing bills splitting attention it isn't far-fetched.
So the honest answer to "what should I do about PRO" is: know which side of the line your building falls on, keep your paperwork clean, and don't make an irreversible decision based on a bill that hasn't been voted on. If it passes on the 23rd, you'll still have a year or two before most of it binds.
If you're thinking about selling a Chicago building
Whether the ordinance passes or not, small multifamily in this city is going to trade on paperwork this fall — leases, deposits, occupancy, and a clear answer to "what rules does this building operate under." That's a listing problem before it's a legal one, and it's solvable.
I list at 1.25% on the listing side. On a $525,000 three-flat that's $6,563. You get the full package — professional photography, 3D Matterport tour, complete online marketing syndication — not a stripped-down service in exchange for the lower rate. There's also a Zero Commission Clause: if you find your own buyer, you owe me nothing. And you can cancel anytime, because I'd rather earn the listing every month than lock you into it.
If you want to know what your building is actually worth in this market before the Council votes, or you just want a straight read on how the exemption line affects your specific property, call me. No pitch, no obligation.
Jason RosenbergThe Rosenberg Group @ Infiniti Properties312.882.9797https://www.jasonrosenbergrealestate.com/
Sources
Block Club Chicago — "Mayor's Office Revises Renter Protection Ordinance, Giving Break To Small Landlords," September 4, 2026
Block Club Chicago — "Mayor Wants To Create A Tenant Bill Of Rights, Other Protections For Renters," June 29, 2026
Block Club Chicago — "Mayor Johnson Rallies Housing Organizers As City Council Vote On His Tenants' Rights Bill Looms," August 16, 2026
The Real Deal Chicago — "Mayor Johnson revises renter protection ordinance, tweaks fail to pacify Chicago landlords," September 9, 2026
The Real Deal Chicago — "Chicago Landlords Gear Up for Showdown Over Tenants' Rights," September 3, 2026
The Daily Line — "Protecting Renters Ordinance introduced to housing committee," June 30, 2026
City of Chicago, Office of the Mayor and Department of Housing — Protecting Renters Ordinance introduction release, June 29, 2026
WBEZ Chicago — "Chicago renters' rights are at stake in dueling City Hall proposals," July 27, 2026
CBS Chicago and FOX 32 Chicago — PRO coverage, June–September 2026
Chicago Association of REALTORS® — Protecting Renters Ordinance (PRO) Issue Summary
Neighborhood Building Owners Alliance — "Oppose Mayor Johnson's PRO"
Institute for Housing Studies, DePaul University — "2023 State of Rental Housing in the City of Chicago"; "Understanding Chicago's Rental Affordability Challenges," October 2025; "Characteristics of the 2 to 4 Stock in Chicago Neighborhoods"
Zumper, RentHop and RentCafe Chicago rent data, August 2026
This article summarizes proposed legislation that has not been enacted and may change before any vote. It is not legal advice. Consult an attorney about your specific property.
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