In my blog last week Does a faulty outlet make a property uninhabitable, it now does under CO law, I asked the question what impact does Colorado’s housing legislation have on rental prices? The results were unanimous in agreement that the recent changes in Colorado’s laws on rentals is making rents increase
Colorado’s rents are increasing because of new housing legislation
I was pretty surprised that 100% of respondents felt that Colorado’s recent housing legislation has increased costs for landlords leading to higher rent rates. The interesting part is that my email list is a wide cross section of genders, political affiliations, income levels, etc… and yet still there wasn’t a single person that said that the recent legislation will lower rent prices in Colorado
Top comments regarding housing legislation increasing rent costs:
Deferred maintenance is normal in rental properties. Evidence is the bill itself. So when an owner has an increase in costs, but must maintain a certain profit, costs will be passed on. This also reduces the supply of decent rentals. The overall effect of less supply will be higher rent prices.
As landlords realize the Resi rentals no longer make sense from a return % and the potential for substantial financial exposure from this bill, bad tenants who take advantage of the bill, the # of rental homes will decline as current rentals are sold to homeowners. You are correct this is not beneficial for anyone long term.
The laws make some owners like me sell my residential units which are bought by owner occupants and that reduces supply which raises rents. Also, the return has to be higher for the owners that keep their properties due to increased costs and risks.
Summary
It is sad that the objective of the legislature is supposedly to make housing more affordable, but from the survey results it is apparent that the opposite is happening. Hopefully our legislature will take notice and do the opposite of what they are doing now to help Colorado become more affordable. Thank you everyone who participated in the survey, your insights are amazing
Additional Reading/Resources
https://coloradohardmoney.com/colorado-habitability-bill-impact-on-owners/
https://coloradohardmoney.com/colorado-property-taxes-jump-40-percent/
