By now, everyone knows that Oregon is in dire need of new housing. Oregon’s housing shortage dates back decades, driven by population growth and insufficient construction.  During the 2010s, population growth outstripped delivery of new housing three to one. And despite increased housing construction being a priority of our elected officials for as long as the shortage has existed, nothing so far has worked to increase supply. In fact, the affordability of first-time homeownership has continued to dwindle despite the efforts of those elected officials.

The latest effort to try to jump-start housing development is HB 3746 (2025), which became effective Jan. 1, 2026. This bill shortens the statute of repose (measured from  substantial completion) for contractors, project managers and design professionals in negligence or other tort actions brought by a homeowners association for a planned community or owners association for condominiums from 10 years to seven years. The bill also imposes additional inspection obligations on the association and requires that the association provide 90 days’ notice to the individual unit owners and to those it intends to sue, hold a vote to bring the action, and allow individual unit owners to opt out of the association action.

HB 3746 does not shorten the period for individual actions by unit owners, breach of contract claims (that would include express warranty claims, such as roofing materials), or actions against the developer, at least to the extent that the claim did not involve the developer’s supervision of the construction. These changes also apply only to projects where the declaration defining the condominium or planned community was first filed on or after Jan. 1, 2026.

The notice requirements the association must give are quite involved. Four notices are now required to be given to the unit owners: three new ones before the association votes to bring the action, and one (previously required) before the action itself is filed. The three pre-meeting notices must abide by the following sequence: a first notice at least 90 days before the association meeting to vote to file the action, a second notice by first-class mail with a certificate of mailing before the meeting, and a third notice by first-class mail at least 15 days before the meeting and vote.

Each notice to the unit owners must contain specific information: 1, notice of a defect in the common property (jointly owned portion, and not exclusive to a single unit the responsibility of an individual owner); 2, a description of the defect; 3, identification of the parties the association considers responsible for the defect (contractor, architect, engineer, or the like); 4, the names of all board members and their contact information; and 5, a warning that says: If the board decides to proceed with the proposed litigation or administrative proceeding, your ability to sell your lot in this planned community may be limited while the litigation or proceeding is pending. If you have opinions or information that you wish the board to consider in making its decision, you are advised to contact the board promptly.

These warnings to the owners are in addition to the previous warning requirement of giving each owner notice, 10 days before initiating the action, the option to opt out of the case.

Finally, the first pre-association meeting notice must also be sent to all those identified in the notice as targets of the to-be-filed action. This also is in addition to the previously required defect notice and opportunity to inspect and cure required before most actions brought for residential construction defect against contractors, subcontractors and suppliers, although there are modifications to the timeline of such notice and secondary notice to subcontractors and suppliers.

With all this said of the new law’s requirements, the real question is: Will it have any effect on the reluctance to build condominiums in Oregon? It may make insurance costs for such projects less expensive, since the period to maintain the coverage will be reduced and the shorter time period may also lessen the risk that association deferred maintenance can masquerade as a construction error, but an association’s board will still be under the same pressure to bring a claim to avoid being the target of owner wrath for failure to take action before the deadline to do so expires. And none of these addresses, or could address, the financial realities of condominium ownership, especially for first-time buyers – there is both a mortgage cost and the association fees, less appreciation than single-family homes, and the looming peril of the special assessment for periodic and possible overdue repairs. Only time will tell if the reduced time and additional hurdles to bring a defect action in HB 3746 will result in any increases in condominium construction.

This article summarizes opinions that are solely those of the author’s, and this article does not constitute legal advice. For legal advice for your situation, you should contact an attorney.

Column first appeared in the Oregon Daily Journal of Commerce on March 13, 2026.