May 4, 2016

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Short-term rentals: A problem that demands notice

by | May 4, 2016

The most effective way to fight homelessness is to stop it before it occurs.

With that axiom in mind, the Colorado Center on Law and Policy worked with Rep. Dan Pabon, D-Denver, to develop legislation that would increase protections for tenants in “month-to-month” rental arrangements.

House Bill 1461 would extend the “notice-to-quit” period to terminate such arrangements or increase the rent from 7 to 28 days. If passed, the bill would give tenants a more reasonable timeframe to find new housing accommodations and to move out.

Right now, Colorado has one of the weakest protections in the country for short-term leases. The current seven-day notification requirement is woefully inadequate — especially since Colorado’s well-documented affordable-housing shortage makes it increasingly difficult for tenants to find shelter within such a limited timeframe. Nationwide, 47 states require longer periods of notification – most require 30 days’ notice, and many states require up to 60 days’ notice.

In less-active housing markets, it may be in a landlord’s best financial interest to secure a tenant with a standard lease and renew the lease once it expires to avoid periods of vacancy. In “hot” housing markets such as Colorado, however, the vacancy rate for rental units is less than 2 percent. This means that landlords have the upper hand since there’s no shortage of prospective renters. Hence, it may be financially advantageous for landlords in tight rental markets to seek more flexible and nontraditional arrangements to allow them to increase rent more frequently and boost revenue for their property.

Landlords and tenants often reach such agreements at the end of a leasing cycle. In a survey conducted by 9to5 Colorado, nearly 40 percent of low-income Denver-metro residents reported that their “landlord refused to let them sign another lease,” following the expiration of their initial lease.

Seven days is not a reasonable amount of time for anyone to find a new housing arrangement, pack and move. But the timeframe is especially onerous for people with disabilities, seniors and tenants with children, putting them at greater risk for housing insecurity.

Tenants who added a ramp, lowered counters, or installed specialized door handles to accommodate a disability or ease the physical limitations that come with aging, may be expected to dismantle or reverse such alterations. This is a tall order if you are already under pressure to relocate quickly.

Constant housing instability for tenants with children may also destabilize family relationships, children’s education and community ties — disrupting children’s development and negatively impacting their potential to succeed later in life. Not only are families with young kids at a higher risk for involuntary displacement, but they are also more likely to experience homelessness as a result.

The ramifications of forced displacement are manifold and lasting. One study indicated that renters who had previously experienced an involuntary move were almost 25 percent more likely to face long-term housing challenges than renters who had not.

Consequently, renters are pushed into less-desirable neighborhoods — where they may experience substandard housing conditions, poorer health outcomes, increased poverty and relatively higher crime rates.

Job loss is another all-too-common result of displacement – particularly if inadequate notice is given. For example, the demands of relocating quickly may cause people to miss shifts at work. These factors are further compounded by race. Forced displacement is most common among black and Latino tenants. Poor, black, single mothers are the demographic most seriously impacted by displacement and its myriad consequences.

With homelessness on the rise is Colorado, it is critical that we push for reforms that will decrease residential insecurity and support our state’s most vulnerable populations.

We encourage our state legislators to see the value in this important protection for month-to-month renters and support HB 1461.

Editor’s note: HB 1461 was killed on a vote of 2-3 by the Senate State, Veterans and Military Affairs Committee.

– Aubrey Hasvold

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