In the ever-evolving real estate landscape in Colorado Springs, staying informed and updated on the latest laws and regulations is paramount. It helps investors protect themselves and ensure a smooth property management process, especially in prime locations like Colorado Springs, where the thriving real estate market provides new investment opportunities to real estate investors daily.
However, navigating the legal amendments in the laws relating to property ownership and management requires constant vigilance and understanding and can be challenging for property owners. Therefore, approaching a property management company is critical to ensure legal compliance and safeguard owners’ interests.
As experienced property managers in Colorado Springs, we present comprehensive updates on the latest legal updates for property owners and investors in Colorado Springs.
Landlord-Tenant Laws in Colorado Springs
Landlord-tenant law encompasses landlords’ and tenants’ rights and responsibilities concerning rental properties. Both parties need to be familiar with fundamental aspects of renting, such as procedures for handling security deposits and understanding state and federal fair housing laws.
Overview of Key Landlord-tenant Laws Applicable in Colorado Springs
It is crucial to comply with landlord-tenant laws applicable in Colorado Springs, including leases, security deposits, maintenance, and eviction process compliance.
Rental Agreements and Lease Terms
A lease serves as a legally binding contract between the property owner and tenant, outlining the terms and conditions for residing in the rental property. The landlord should document the agreement in writing.
While leases can be either oral or written, having written agreements in place is suggestable. It ensures clarity and serves as a reliable reference for both parties involved. Additionally, a lease may contain provisions that permit or prohibit subletting or assignment, subject to the property owner’s consent.
Security Deposits and Refund Policies
Landlords in Colorado Springs often inquire about potential limitations on collecting security deposits. It is essential to note Colorado Springs does not impose more restrictions than the state of Colorado which limits landlords to charging 2 months rent for a deposit. However, adhering to the statutory requirement of returning the security deposit within 30 days of lease termination is crucial. This deadline can be extended to 60 days if agreed to in writing in the lease.
Maintenance and Repairs
The landlord-tenant laws in Colorado Springs specify that the landlords have to ensure that the premises of the building is safe for living and is habitable and clean. For any repairs and maintenance, the tenant must issue a written notice specifying the need for maintenance. The landlord is subject to many regulations regarding habitability standards.
Eviction Process and Tenant Rights
The eviction process is a legal procedure initiated by landlords to remove tenants from a rental property. The eviction process starts with notifying the tenant of the reason for eviction and a notice to quit for non-paying tenants or tenants who have broken any rule or condition from the lease agreement.
This notice period for correction and compliance of the lease is 10 days in most situations. However, in 2023 the Colorado State Supreme court ruled the provision of the CARES act is still applicable which requires landlords with federally backed mortgages to give a 30 day demand in situations of non payment of rent.
If the tenant does not alter the condition, which is the reason for eviction, the landlord can file the complaint in court, and the decision is taken based on the judgment passed by the court.
Recent Changes to Landlord-tenant Laws in Colorado Springs
There are a few changes in the landlord-tenant laws relating to eviction, lease termination and penalties for non-compliance.
Updates on Eviction Moratoriums and COVID-19-related Regulations
The COVID-19-related eviction moratorium in the state has officially expired, and there are no plans for its extension. In 2020, legislation was enacted to prevent landlords from evicting tenants solely based on non-payment of rent. However, these protections are no longer in effect in Colorado Springs. Except in the case for owners who have a federally backed mortgage. You’re still required to provide a 30 day demand notice for non payment of rent breach of lease.
Amendments to Lease Termination Procedures
In most states, the termination notice period shall be 30 days in case of a month-to-month lease. For a few states, it changed. For Colorado Springs, it is a 21-day notice period. The tenant and the landlord have to provide a 21-day notice period for initiating the lease termination procedures. The notice might be longer if your lease has a notice requirement that exceeds the state minimums.
Increased Penalties for Landlord Non-compliance
There are penalties for violating various laws, including the Fair Housing Law. Fair housing violations can result in many thousands of dollars in fines and penalties.
Local Zoning and Land Use Regulations
The City of Colorado Springs assigns each property to a specific zone district, which designates the permissible use and development standards for the land and structures in that area. These zone districts categorize the City into residential, commercial, office, industrial, and public facility zones, each with its own set of standards and guidelines.
Understanding Local Zoning Regulations in Colorado Springs
It is crucial to understand the local zoning regulations in Colorado Springs. Local zoning and land use regulations are specific and keep updating from time to time.
Zoning Districts and Permitted Land Uses
The Springsview aerial application is an invaluable resource for property owners in the City of Colorado Springs, including landlords. It provides a convenient means to determine the specific zone district of a property. Users need to enter the property address or Tax Schedule Number to access detailed information on zoning regulations, restrictions, and permitted uses.
This enables landlords to make well-informed property use and development decisions while ensuring adherence to zoning requirements. The application’s comprehensive zoning and land use data is particularly beneficial for landlords seeking a deeper understanding of their property’s zoning specifications.
Building Codes and Permits
The Division of Housing’s Building Codes & Standards protects the citizens of Colorado Springs by regulating the construction of properties. The building codes apply to properties including manufactured homes, multi-family homes and homes built to serve people with disabilities.
Investors require a building permit for building or renovating a property and the use of a building or changing the use of the building. You can obtain these permits from the Planning and Housing Department. The most common permits required are building permits, electrical permits, plumbing permits, mechanical permits, and demolition permits.
Recent Updates to Zoning and Land Use Regulations
There are a few zoning and land use updates. Understanding the changes in the laws and regulations is of cardinal importance in staying informed regarding the rules for safeguarding your property.
Changes in Zoning Classifications and Development Opportunities
Zoning and subdivision ordinance passes a new regulation. This regulation will regulate how the property users will use their land, and other rules relating to the height of the building, uses of the property, how many parking spaces are in need, and much more. The zoning and subdivision ordinance also describes the procedures for subdividing property or undertaking a larger development project.
New Regulations for Short-term Rentals and Vacation Properties
Owners of short-term rentals and vacation properties in Colorado need to review the licensing requirements in their municipality. While there is no state level licensing, several municipalities do have licensing.
Taxation Laws and Incentives
The changes in taxation laws are frequent, and staying updated about the changes is important. These changes include property tax rates and assessments, deductions and exemptions, and other regulations.
Overview of Property Taxation in Colorado Springs
Understanding the taxation framework in Colorado Springs is challenging as the taxation laws change frequently. Let us look at some aspects like property assessments, the tax deductions property owners get, and the changes in property taxation laws.
Property Tax Rates and Assessments
With an average effective rate of 0.48%, Colorado Springs has one of the lowest tax rates in the country. The El Paso County Assessor’s office assesses the property’s value for tax purposes. The actual value of investment property is not the taxable amount. The taxable amount is a portion of the real value. This portion is called an “assessment rate,” and the future value is called the “assessed value.” There are different assessment rates for different properties, such as
- Residential- 6.765%
- Residential Multi-family- 6.765%
- Commercial- 27.90%
- Commercial Lodging- 27.90%
- Non-residential property- 29%
Tax Deductions and Exemptions for Property Owners
Landlords, and property investors get many exemptions, deductions and incentives. A few are mentioned below
- Rental repairs are generally deductible the year they complete.
- Landlords can deduct interest expenses in various ways, including mortgage interest.
- Depreciation for buildings and land are both deductible each year
- Local and long-distance costs qualify for this deduction as long as they relate to rental property activity.
Recent Changes to Property Taxation Laws and Incentives
Tax laws and incentives have received new updates for property owners and property investment.
Updates on Property Tax Assessment Methods
The County treasurer’s office taxes the actual or market property value set by the assessor, multiplies it by the assessment rate, which is currently 6.765% and then multiplies that sum by the mill levies of all government agencies that levy taxes on a specific property. The government agencies levying the taxes are the City, county, school districts and other taxing districts.
New Tax Incentives for Energy-efficient Properties
The new tax incentives are significant and beneficial for saving taxes and increasing the income of property owners. The property tax exemption for residential energy equipment is 100% for renewable energy system property.
The sales and use tax incentives for renewable energy equipment are 100%. The Energy Smart Colorado Renewable Energy Rebate Program, offers a generous rebate for residential properties. For solar photovoltaic (PV) installations, homeowners can receive a rebate of 50% of the project costs, up to $500. The rebate covers 50% of the project costs for solar thermal installations. The rebate for commercial property is 50% of the project costs.
It’s imperative you have a knowledgeable tax professional on your side. We are not tax professionals and the information here may not be accurate for your situation.
Incentives for Implementing Sustainable Practices in Properties
Colorado Spring launched a new program named the Business Personal Property Tax Incentive Program (BPPT). Under this program, equipment used to conduct business, such as computer appliances, machinery, desks and furniture, or anything that is not permanently affixed to the land, will qualify for an incentive between 50% to 90% of business property taxes paid.
Legal Considerations for Real Estate Investors
When investing in properties in Colorado Springs, critical legal factors to consider include due diligence, zoning laws, environmental laws, local ordinances, building codes, permits, Fair Housing laws, and tenant-landlord laws. You should conduct thorough inspections to ensure structural integrity, electrical systems, and plumbing and address environmental concerns. Ensure to update yourself with these laws and regulations to ensure compliance.
Recent Legal Trends Affecting Real Estate Investors
The Colorado Housing and Financing Authority provides first-time home buyers with a range of subsidies and loans as financing options. Their down payment award of the loan is up to 3% of the initial mortgage and is free of charge. This results in Colorado Springs homes being 23% cheaper in Denver. It is an opportunity for investors to consider buying properties in Colorado Springs.
Approach Muldoon Associates for Legal Updates
Keeping abreast of legal changes is crucial for property owners and investors in Colorado Springs. It enables them to make well-informed decisions, manage risks, and capitalize on the flourishing real estate market. One of the promising ways to do it is by engaging the services of a property management company, such as Muldoon Associates, which can provide valuable legal updates, ensure the protection of property owners’ interests, foster positive tenant relations, and safeguard the profitability of real estate investments.
To obtain further information and stay updated on legal matters, please contact us at Muldoon Associates.