Key Points
All Colorado landlords must now accept housing subsidies, with no exceptions for investor size or number of units owned.
A 30-day notice is required before initiating eviction for nonpayment if the tenant receives rental assistance or the property has a federally backed mortgage.
Landlords must cooperate in good faith with housing subsidy programs and may face fines of up to $50,000 for noncompliance.
The Colorado legislature recently passed HB25-1240, a sweeping new law that significantly impacts rental housing. This legislation, titled Protections for Tenants with Housing Subsidies , introduces several requirements for landlords and housing providers, regardless of property size or portfolio scale. Understanding these changes is essential for maintaining compliance and avoiding costly penalties.
Mandatory 30-Day Eviction Notice
HB25-1240 codifies a 30-day notice of demand for tenants receiving any housing subsidy who fail to pay rent on time. This extends the eviction timeline and overrides the standard 10-day notice typically used for nonpayment of rent.
Importantly, the 30-day notice requirement also applies if the property has a federally backed mortgage, even if the tenant does not receive a subsidy. Federally backed mortgages include FHA, VA, USDA, and other government-supported loans. Landlords unsure of their mortgage type should verify it to ensure legal compliance.
Universal Acceptance of Housing Subsidies
Another aspect of HB25-1240 is the elimination of exemptions for small landlords. All landlords in Colorado, whether owning one unit or many, are now required to accept all housing subsidies, including Section 8 vouchers. Declining or refusing to work with applicants or tenants based on this source of income is now considered a fair housing violation under this law.
Additionally, landlords are now legally required to:
- Accept applications from tenants with housing subsidies.
- Respond in a timely manner and complete necessary paperwork without delay.
- Cooperate in good faith with housing authorities.
Delays or refusals to engage with housing programs can be interpreted as discrimination and may result in significant legal consequences.
Warranty of Habitability Adjustments
HB25-1240 includes additional provisions related to habitability violations:
- Rental rate must be proportionally reduced based on the area of the property affected.
- If rent was prepaid (even by a housing provider), a prorated refund must be issued to the tenant for the uninhabitable time periods.
These calculations can be complex and require case-by-case consideration, such as determining how much rent should be refunded if only part of the property is considered uninhabitable.
Immediate Enforcement and High Penalties
HB25-1240 went into effect May 29, 2025, with no grace period. Violations of this law can result in penalties ranging from $5,000 to $50,000, plus additional civil penalties.
Unlike prior legislation, this legislation provides no exemptions for small landlords. All housing providers are equally responsible for compliance.
The above information should NOT be taken as legal advice. For legal guidance specific to a particular situation, consult a qualified attorney or legal professional.
At Grace Property Management, we believe that when property management is performed with integrity and transparency, both tenants and landlords benefit. Property management is not just our business - it is a relationship between us, our owner-clients, and our tenant-residents.
If these are important to you, we may be a good fit to provide you, your property, and your tenant-resident with our full-service property management services.
Feel free to reach out to us for assistance.
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Serving real estate investors and residents since 1978.
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