By Marianne Goodland | Colorado Politics
Gov. Jared Polis on Monday signed the first major bill of his administration that sponsors hope would unclog the state’s longstanding logjam regarding the construction of affordable, middle-market multi-family housing, specifically condos and townhomes, and, thereby directly promote home ownership.
Past efforts by the governor had mostly focused on rental housing and zoning.
This year, House Bill 1272 aims to jumpstart the affordable condo market, which backers say has died off in Colorado due to “construction defects” litigation.
This bill puts Colorado more in line with other states that see condo construction and protects homeowners from legitimate defects, Polis said.
“There’s no silver bullet” for dealing with Colorado’s housing crisis, but, the governor added, the new law puts a critical piece in place.
“I’m very hopeful” that five years from now, Polis said, there will be condos in the $250,000 to $300,000 range that people can afford to buy, which puts them on the path to start building build wealth.
The 2001 Construction Defect Action Reform Act had set up a process for homeowners to sue builders when they find defects, which can range from serious issues, such as cracks in the foundation or HVAC problems, to smaller problems, such as defective cabinetry and leaks.
A report last September from the free-market think tank Common Sense Institute said that “insurance costs for condominiums surged to 5.5% of a project’s hard costs, more than 233% higher than multifamily rental home projects, which had insurance costs as low as 1.1% to 1.65% of project hard costs.” Insurance costs are tied to lawsuits over construction defects, supporters of changing the law have argued.