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The beautiful state of Colorado, well known for its majestic mountains and Western heritage, is grappling with an escalating affordability crisis. This issue is most evident in neighborhoods like Denver’s popular Washington Park. Once a haven for historic homes passed down through generations with modest values between $300,000 and $700,000, it has now become out of reach for many. In 1995, young professionals could stretch their salaries to afford a downpayment of $125,000 on their first home. Fast forward to today, and that same investment would only get you a 1-bedroom, 1-bathroom bungalow costing a staggering $600,000.
As Colorado’s housing prices soar to match those of coastal cities—without the corresponding increase in salaries—housing has taken center stage in the state’s political discourse. Governor Jared Polis underscored this urgency after voters rejected his housing initiative in the 2023 ballot, citing concerns over government overreach on private property rights. In response, lawmakers have stepped up efforts to address Colorado’s affordable housing crisis.
Recent Legislative Actions on Housing
Several key bills aimed at alleviating the housing crisis were passed and signed into law by Governor Polis:
House Bill 1259 (Rental Pricing)
Purpose: Prevents landlords and other building owners from price-gouging rents during natural disasters.
Sponsor: Rep. Kyle Brown, D-Louisville
Background: This bill was influenced by the housing squeeze experienced during the Marshall Fire in 2021.
House Bill 1152 (Accessory Dwelling Units – ADUs)
Purpose: Requires local governments to allow accessory dwelling units (granny flats or tiny homes) on single-family properties.
Bipartisan Support: A rare instance of bipartisan agreement that includes an $8 million grant program through the Department of Local Affairs.
House Bill 1098 (Eviction Requirements)
Purpose: Mandates landlords to show cause for evicting residential tenants.
House Bill 1007 (Unrelated People in Homes)
Purpose: Removes limitations on the number of unrelated people who can live in rental properties.
The Homeownership Challenge
Despite these legislative efforts, Colorado faces significant challenges in promoting homeownership, especially for individuals transitioning from renting to buying. A decades-old construction defect law has stymied the construction of new condominiums since 2010. Instead, an influx of apartments has replaced potential condo developments, thereby limiting the American Dream for many first-time homebuyers. The primary deterrent for builders is the high cost of liability insurance, a consequence of the construction defect law. Unfortunately, all three bills introduced to address this issue failed to pass.
Wrapup
Colorado’s journey toward resolving its housing crisis is ongoing, with recent legislation representing steps in the right direction. However, the state must continue to find innovative solutions to balance affordability with the dream of homeownership, ensuring that its growth and development benefit all residents.
