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What You Probably Don’t Know About Colorado’s Rental Laws

Colorado is one of the states that are becoming a seller’s market. With the high housing demand and an increasing population, real estate is a lucrative business here. If you have a spare property, you should consider renting it.

Before you do so, you need to do two things: work with a Denver real estate lawyer who can draft contracts for you and know these rental regulations:

1. Anti-discrimination

The Federal Housing Act prohibits you from discriminating a potential tenant because of color, age, national origin, familial status, and religion. But the state also has its own housing act, which expands the list. As a landlord, you cannot prohibit anyone from renting your property because of their sexual orientation, ancestry, creed, and marital status.

2. Airbnb Rental

In spite of the popularity of Airbnb in Colorado, rental regulations can still be confusing. In fact, the rules can differ depending on the area. For example, in Colorado Springs, you are responsible for applying a city tax license for the property. In return, the state will collect lodging and state taxes, as well as city and county sales taxes.

If your property is under Airbnb, the company will collect these on your behalf and remit them to the proper tax authorities. If you’re operating in Denver, you also need a short-term rental license and have liability insurance. It’s important the insurer knows the property is for vacation or short-term rental. If the property is under a homeowners’ association, you need to inform them first before you secure the license.

house model with keys, contract, and pen

3. Subletting

With the cost of rent in Colorado rising, some tenants consider subletting the property. According to Colorado law, they can do so but with some caveats.

One, you cannot deny the tenant such arrangement unless you expressly mention it in your lease agreement or contract. You can deny a sublet only when you have a just cause. For example, the other tenant might not be capable financially.

Two, your tenant needs you to send you a mail letter, requesting to sublet. If you don’t reply within 30 days, it is assumed you agree with the sublet.

Three, the lease agreement. You will still receive the rent from the sublet. It also means if the new tenant fails to pay the lease, you can sue them, as well as the other tenant.

4. Eviction

When can you evict a tenant? It actually depends on a number of circumstances. On average, the process takes about 25 days. It is longer if the property is a mobile home.

In general, you need to have a valid reason to evict a tenant, especially if you want to do it before the lease expiration. These include non-payment of rent, violations of the lease contract, and criminal activities done within the premises.

Before any eviction, the tenant must receive a notice. If the violations are “minor,” it might be a three-day notice, in which they have the option to correct them. An example is paying the rent. If the causes are more severe, such as a crime, the notice might already be a notice to quit, which means the tenant has no recourse but to leave the property.

These days, rentals are a cash cow if you’re living in Colorado. It doesn’t matter if yours is a vacation rental, fixed-lease term, or month-to-month rent. But the rental rules and regulations can be confusing. To protect you and the tenant, create an agreement with the help of a real estate lawyer.

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