Property Management Education

Warranty of Habitability Law Update for Denver Real Estate Investors

Earlier in 2019, Colorado legislature passed four new laws impacting Colorado real estate investors, property managers, and landlords.

In part four of our four part blog series on these real estate law updates, we’re going over HB19-1170, which outlines updated laws regarding warranty of habitability for Colorado rental properties.

What is Warranty of Habitability for Denver Rental Properties

Every Denver rental property must meet basic standards of living, known as the warranty of habitability. A few of the standards include things like lockable doors and windows, functioning heat, proper plumbing, and other big picture items on what the state calls their warranty of habitability list.  

If any of these items on this warranty of habitability list are deficient, the Denver property manager or real estate investor has to correct the problem within a set amount of time.

Updates to Warranty of Habitability for Colorado Landlords

Warranty of Habitability for Denver rental properties

The old Warranty of Habitability law was pretty self-explanatory. However, there are now some major updates to this law that every Denver real estate investor and landlord comply to conform with Colorado law.  

Under the updated law, a property is now considered uninhabitable if:

  • The item is on the list OR
  • A condition makes the property unfit for human habitation OR
  • The property is in any condition that materially interferes with the tenant’s life, health or safety OR
  • Mold that if not remedied, would interfere with the tenant’s life, health, or safety.

Additionally, more updates have been added to the 505 list. The biggest update is that appliances are now included, meaning that if a dishwasher or microwave stops working, the tenant could claim that the property is uninhabitable.

According to the updated Warranty of Habitability law, functioning appliances that conformed to applicable law at the time of installation are to be maintained in good working order.  

What To Do When You Receive A Warranty of Habitability Notice

Once a Denver property manager receives a warranty of habitability notice from a tenant, they must:

  • Respond within 24 hours after receiving the notice
  • The response must indicate the landlord’s intent for remedying the condition
  • Provide an estimate for when remediation will commence
  • Provide an estimate for when remediation will be completed

In order to avoid breaching, they must meet the standards above within the following time frames:

  • Warranty list items: 96 hours
  • Otherwise inhabitable issues: 96 hours
  • Materially interferes with life, health, or safety: 24 hours
  • Mold: Within 96 hours the property manager must mitigate immediate risk by installing a containment, stopping active source of water to the mold, and installing a high-efficiency particulate air filtration device to reduce tenant’s exposure to mold

If the issue is a life, health, or safety scenario, the tenant will most likely want to live somewhere else until the issue is remediated. In this case, the tenant has the legal right to demand that the landlord move the tenant to:

  • A comparable unit as selected by the landlord (no cost to tenant)
  • A hotel room as selected by the landlord (no cost to tenant)

In both cases, the tenant is still expected to pay rent on the vacant property.

Mold Specific Actions

Denver property management

Mold is dangerous, and the Colorado legislature wants Denver property managers and real estate investors to eradicate the problem as soon as possible. They now require these additional actions when it comes to mold:

  • Establish appropriate protection for workers and occupants
  • Eliminate or limit moisture source and dry all materials
  • Decontaminate or remove damaged materials as appropriate
  • Evaluate whether the premises has successfully remediated
  • Reassemble the premises to control sources of moisture and nutrients and thereby prevent or limit the recurrence of mold

It may be logistically difficult to comply with all of these conditions - however, it’s the law, and Denver property managers must do what they can in order to comply.

If the Tenant Wants to Make the Repair...

Denver real estate investors

In some cases, the tenant may be willing to make the repair themselves. If they decide to do so, they can request a deduction on rent under these certain circumstances:

  • Tenant must provide the required notice
  • Landlord must fail to commence legally required remediation
  • Tenant must give the landlord an additional notice at least ten (10) days prior to the rent payment being due of the tenant’s intent to deduct rent
  • The additional notice must include a copy of at least one good-faith estimate of costs to repair or remedy the condition

Don't worry, it gets even more complicated...

After receiving the ten (10) day repair or deduct notice:

  • The landlord has four days to respond with its own estimate
  • If the landlord fails to respond within four days, the tenant can then proceed to deduct rent until the entire amount of the estimate is deducted
  • If the tenant repairs on their own, they must use a professional
  • In the case of a malfunctioning appliance, the tenant may simply replace the appliance instead of repairing it
  • If the property you manage is subsidized or low-income housing, the tenant has no right to deduct rent or repair

Tenant Rights to Terminate

If after all of this the tenant is still not happy, they are able to terminate their lease.

For non-appliance issues, the tenant can terminate upon 14 days notice for breach of the same condition within six months.

For appliance issues, the tenant can terminate upon 14 days notice for breach of the same condition within six months for appliance issues, but if the landlord fixes the appliance within 14 days, the tenant cannot terminate.

Other Warranty of Habitability Requirements

Still reading? Good! Here are just a few more things Denver real estate investors and landlords need to know about the updated Warranty of Habitability law updates:

  • Landlord must provide tenant a copy of the lease– written if requested
  • Requires the lease to include a statement indicating the name and address of the person who is the landlord or the landlord’s authorized agent
  • Provide written notice to the tenant within one business day if the landlord or authorized agent changes

Clear Up Confusion with Grace Property Management

Whew, we made it! That’s a lot of confusing rules that are rocking the Colorado property management industry. This is a very complex law with many moving parts.

Do you feel like you need more clarity on the Warranty of Habitability or any other Denver property management topic? Talk to the industry experts at Grace Property Management!

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