Key Changes to Lease Renewals
The rental landscape in Colorado underwent significant changes with new legislation passed last August. These changes affect how lease renewals are handled, and it is essential for property owners to stay informed and prepared.
Key Changes to Lease Renewals
One of the most impactful changes is the requirement to offer lease renewals to tenants, except in specific circumstances such as habitual late rent payments. According to the new rules:
- Rent is considered late if it remains unpaid after the 23rd of the month. This date factors in the demand posting cure period, so it may vary slightly in practice.
- Unless a tenant has consistently failed to meet this payment timeline, they are entitled to a lease renewal.
The lease renewal process begins approximately four months before the current lease expires. During this time, we take the following steps:
- Conduct a Market Rent Analysis
- We evaluate comparable properties in your area to determine a fair and legally compliant rent adjustment. This analysis considers property size, location, amenities, and current market conditions.
- Recommend a Potential Rent Increase
- Based on the market analysis, we propose a reasonable rent increase. It’s important to note that while your operating costs (such as property taxes or insurance) may have risen, these increases cannot be directly passed on to tenants. Any rent adjustment must be “reasonable” as defined by law, and our analysis ensures compliance.
Why Market Analysis Matters
We understand that these new regulations can be challenging, especially given rising property costs. However, relying on market analysis is essential for:
- Legal Compliance: Ensuring any proposed rent increase aligns with market conditions protects you from potential legal issues.
- Fairness to Tenants: Basing rent adjustments on objective data fosters a sense of fairness and transparency.
- Tenant Retention: Reasonable rent increases encourage good tenants to renew their leases, reducing vacancy periods and turnover costs.
How Dakota Property Management Supports You
At Dakota Property Management, we stay ahead of legal and regulatory changes to help you navigate the complexities of rental management. Our commitment includes:
- Keeping You Informed: We provide timely updates and clear guidance on legal changes affecting your property.
- Protecting Your Investment: By adhering to regulations, we minimize risks and maximize returns for your property.
- Fostering Positive Tenant Relationships: We aim to create a respectful and supportive environment for all tenants.
Navigating these changes can feel overwhelming, but we are here to help. If you have any questions or concerns about lease renewals or other aspects of property management, don’t hesitate to contact us. Let us simplify the process for you and ensure your property remains a valuable investment.