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Can you prevent commercial rent increases in Colorado?

On Behalf of | Jan 11, 2019 | Landlord's Guide |

Under Colorado law, rental price capping is illegal. Although the issue was brought up to Denver legislature as recently as February 2018, previous Colorado Supreme Court rulings upholding the 1981 law mean the situation is unlikely to change.

In the meantime, tenants like you experience continuous rent increases with no end in sight. Landlords usually attribute the increases to changes in the market, but other than taking your business elsewhere, is there anything you can do to protect yourself?

Why do costs keep increasing?

Unless your landlord significantly benefits from you staying at the location, fair market pricing means they have little motivation to keep you simply because you do not want to pay higher rent or cannot afford to do so. They have a legal right to increase rent unexpectedly based on the following:

  • Colorado’s ban on rental price capping
  • A clause within your lease (sometimes non-negotiable)
  • Sudden increase in taxes, market/property value

Although landlords are often murky about their reasons for increasing the rent, if you cannot or do not wish to pay the new rent they have a legal obligation to follow specific steps before pursuing eviction. This process may give you time to pursue legal representation if you feel you have been unfairly targeted.

Can you challenge a rent increase?

Being prepared is one of the best ways you can protect your investments. That includes keeping an eye out for the following:

  • New taxes/laws
  • Changes to trends in neighborhood property value
  • Cost of Living Annual Increase (increase in standard of living)
  • Opportunities to personally petition local government for law reform

If you choose to negotiate the increase with your landlord, and the negotiations fall through, you could try to pursue an audit. As a tenant you have the right to challenge how your landlord arrived at the price, especially if you suspect a computation error.

This usually involves hiring an experienced legal team and may reap significant benefits for your bottom line. The landlord may even back down from their unfair price increase if they know a legal team would find any illegal bookkeeping practices. This could protect both you and other future tenants.

To avoid rent increase confusion or unfair practices in the first place, many tenants seek legal advice before they sign a lease. O’Brien Legal helps tenants perform due diligence prior to closing to avoid situations such as these.