Midterm voters to take on Colorado's soaring housing costs

By AP News

Voters will take on the soaring costs of housing in Colorado next Tuesday when they decide on a bevy of local land statewide ballot measures

Election 2022 Colorado Housing

DENVER (AP) — Bloated housing prices in the past few years have crept into every corner of Colorado. In Rocky Mountain resort towns, wealthy newcomers gobble up the dwindling housing supply. In Denver, tenants owe an estimated $32 million in back rent. And in mobile home parks, the state's last bastions of affordability, out-of-state investors are buying the land and hiking up lease prices.

Fed-up Coloradans have taken the crisis into their own hands and will vote Tuesday on a host of local and statewide ballot measures intended to rein in the soaring cost of housing.

The U.S. Census Bureau found that over half of all Colorado tenants are considered rent burdened, spending more than 30% of their income on rent in 2020. Colorado housing prices rank among the nation's highest when accounting for how much its residents earn. The Denver metropolitan area alone saw home prices shoot up by 35% over the past two years, which was a larger increase than those in New York City and San Francisco, according to data from the real estate company Redfin.

Tyler Randolph, an eighth grade teacher in Denver, said that if an affordable housing solution isn’t coming from those he elected, “it has to come from somewhere else.” He voted for Proposition 123, a statewide measure that would direct an estimated $300 million in state tax revenue to low-cost housing each year. It's the only statewide affordable housing measure in the country that will be decided in Tuesday's midterm election.

Voters in at least 13 Colorado communities or counties are considering measures that would increase taxes on short-term rentals such as those booked through Airbnb and Vrbo or redirect existing taxes on them to help toward housing costs, at least partly.

In Colorado's largest city, Denver, residents are considering levying a fee on most landlords that would bankroll attorneys for tenants facing eviction, which would expand free representation that lower-income renters can already receive.

The housing referendums arrive as the last dregs of pandemic-era rental assistance that acted as a bulwark against eviction for tens of thousands of Coloradans disappear.

“People are struggling with dire need and the immediacy of displacement, of gentrification, of the high cost of living,” said Zach Neumann, executive director of Colorado's COVID-19 Eviction Defense Project, which has endorsed the statewide ballot measure. "They are saying: ‘What can I do right now in my community to address the real consequences of that?’”

On Tuesday, Edna W. Williams, 91, stood behind her screen door speaking to a cheerful canvasser trying to persuade her to vote for the ballot measure. Formerly a nurse in senior care, Williams told the canvassers that she's watched the inexorable rise in rents push older folks reliant on fixed Social Security incomes out of their homes. She said she supports the initiative so that struggling seniors “can die knowing that people cared enough.”

The statewide proposition wouldn't raise taxes, but it would eat into a tax refund Coloradans receive every year under a constitutional amendment called the Taxpayer's Bill of Rights.

Opponents say the proposition would take too big of a cut out of the popular TABOR checks.

The state should cull burdensome building regulations and fees instead of chipping away at Coloradans’ refunds, said Michael Fields, senior adviser for a conservative advocacy group called Advance Colorado Action that opposes the measure.

"The whole market is out of whack," Fields said. “We have to build more, not tax more."

The Denver measure would force most of the city's landlords to pay $75 annually to fund lawyers for every tenant facing eviction. Backers of the measure say it would help with disproportionate representation in the courtroom.

Between July 2017 and June 2021, Colorado landlords had legal council in 77% of eviction cases while renters were represented in only 1.3%, according to an analysis by Enterprise, a national affordable housing organization.

Tenants without representation were less likely to come to an agreement with their landlord and more likely to be forced out, the report found.

The Denver Metro Chamber of Congress opposes the measure, arguing that the fees will be passed along to the tenants in the form of higher rents. Adam Burg, the chamber's vice president of government affairs, argued that the existing protections for low- and moderate-income tenants, along with nonprofits offering legal council, are enough.

West of Denver, between the crags of the Rocky Mountains, at least 13 communities or counties have ballot measures that would increase taxes on short-term rentals or redirect existing taxes on them to, in part, help toward housing costs.

When asked about the measures, Tom Martinelli, Airbnb's senior public policy manager, said, “experts agree the affordable housing issue in communities across the U.S. can be boiled down to simply not building enough affordable housing.”

Martinelli added that Airbnb supports Colorado's statewide housing ballot measure.

The sweeping movement to raise taxes on short-term rentals seeks to counter dramatic shifts in the housing market brought on partly by the pandemic's remote-work revolution. In six popular Rocky Mountain counties, a wave of pandemic-era newcomers — most making more than $150,000 a year — outbid locals in a record frenzy over scarce homes, according to a survey from the Colorado Association of Ski Towns.

In one of the counties, Pitkin County, the city of Aspen saw median home values spike by nearly $1 million since the start of the pandemic, according data from Zillow.

City Councilmember Rachel Richards said the high costs have throttled Aspen's most basic services. Faced with a critically undersized police force over the summer, the city purchased two condominiums for $1 million each in order to entice two more officers to join the force, she said.

In response to the crisis, the City Council added a ballot initiative that would raise taxes by 5% to 10% on short-term rentals based on whether the units are owner-occupied. Slightly more than two-thirds of that revenue would go toward affordable housing projects in the community.

“You have to participate in your own rescue," said Richards.

Ben Wolff, general manager of Frias Properties of Aspen, a company that manages short-term rentals, worries that a hike in taxes would impede the resort city's ability to lure vacationers. His organization instead proposes a lower tax across all sectors of the economy.

“It's the right problem but the wrong solution," Wolff said.


Jesse Bedayn is a corps member for the Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.


Follow the AP’s coverage of the midterm elections at https://apnews.com/hub/2022-midterm-elections and check out https://apnews.com/hub/explaining-the-elections to learn more about the issues and factors at play.

Explore more on these topics:



This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

Originally published by Associated Press Valuethemarkets.com, Digitonic Ltd (and our owners, directors, officers, managers, employees, affiliates, agents and assigns) are not responsible for the content or accuracy of this article. The information included in this article is based solely on information provided by the company or companies mentioned above.

Sign up for Investing Intel Newsletter