In spite of a strong demand, there is a distinct lack of affordable housing in Colorado communities, creating a hindrance towards restoring our economy.  A strong housing market with diverse and attainable options is critical to rebuilding the economy now, as well as in the future.

A mounting shortage of owner-occupied, multi-family housing has been a chief area of concern for Colorado’s housing industry, including the Pikes Peak region.  Condo and townhome construction has, in essence been brought to a standstill, partly due to builder apprehension over the number of lawsuits surrounding construction troubles.

Instead of waiting for the State Legislature to authorize reforms, local city governments are working to make the much-needed improvements regarding construction defects at a local level. Several Colorado cities have already enacted ordinances to reform defects litigation for common interest communities.

REALTORS® believe it’s time to make a change and are working tirelessly to help find opportunities for attainably-priced condos to be built.  The Pikes Peak Association of REALTORS® (PPAR) encourages reforms that encourage builders to construct more affordable housing, provide increased homeownership opportunities, and subsequently stimulate our state’s economy.

In the Pikes Peak region, active condo/townhome listings are down 45 percent in 2015 because potential first-time homebuyers have significantly limited options, and are then driven into the skyrocketing rental market.  In addition, seniors looking to downsize from single-family homes are left with scarce opportunities.

On December 8, 2015 Colorado Springs City Council joined other municipalities in passing an ordinance that reforms construction defects litigation for common interest communities.  In part the ordinance requires written communication between HOA’s, homeowners, and builders prior to initiating any arbitration or litigation.  Encouraging opportunities for builders to resolve defects, with the consent of HOA’s and homeowners, will significantly reduce the trepidation of potential litigation and the remarkable cost of enduring such litigation.

Additional legislation REALTORS® are diligently supporting, is the re-authorization of the National Flood Insurance Program (NFIP).  Earlier this year the House of Representatives held the first in a series of roundtables and hearings.  Though no legislation has been introduced, it is critical that the program be reauthorized before September 30, 2017 in order to keep selling flood insurance.

Launched in 1968, NFIP was designed to reduce the impact of flooding on private and public structures by providing affordable insurance and encouraging communities to adopt and enforce floodplain management regulations.

Prior to the last reauthorization, the NFIP was shut down twice and cost 40,000 home sales each month across the country until finally being reauthorized.

The largest trade organization, The National Association of REALTORS® (NAR), recently sent a letter to the Charmian and Ranking Member of the Subcommittee on Housing and Insurance for the Housing Financial Services Committee urging the reauthorization of the NFIP.

REALTORS® are encouraging the Subcommittee to consider permitting the NFIP to take advantage of new technologies that can improve the accuracy of the flood maps upfront, including risk factors such as distance to a river or coast and property elevation (which are not currently tracked by NFIP).  Reducing the number of homeowners who have to appeal an incorrect map on the back end will reduce costs and keep rates more accurately aligned with risks.

Every year, billions of dollars are spent by the federal government on disaster relief for flood victims, which in turn falls on the taxpayers shoulders.  To prevent the burden of disaster relief for taxpayers, REALTORS® support a strong NFIP, along with private insurance alternatives, to make sure flood insurance stays available in all markets at all times.

Misinformation prevents the private market from meeting the demand for flood insurance.  If more properties were insured, fewer owners would have to turn to taxpayers for disaster relief.  If only “high-risk” properties buy insurance (adverse selection), it distorts the market and drives up rates until no one can afford insurance.  NFIP provides an insurance market alternative to taxpayer funded relief.

REALTORS® care about our community and are persistently working behind the scenes to advocate for and protect homeowner interests at every level of government.  A key function of our REALTOR® Associations is vigorously striving to foster a sound and dynamic U.S. real estate market and cultivate successful communities.

Colorado State Capitol Building

Gabriel Eckert