Law, economy spurring rentals in Littleton

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As plans for multifamily housing throughout the city proliferate, some people decry renters while others take offense.

“Renters are not equivalent to homeowners in a community,” said Amy Reed, owner of The Melting Pot, during the final hearing on the Nevada Place project in the heart of downtown. She cited concerns about crime and residents’ financial and civic investment.

“I don’t think that’s based in fact,” replied Charles Jordy. “I think it’s kind of a scare tactic. … It’s a path that’s chosen by many people at many points in their life.”

During the hearing, Littleton Councilor Jim Taylor mentioned a 2007 Colorado law that’s deterring developers from building for-sale condos. Taylor is the chair of the Denver Regional Council of Governments’ Metro Vision Implementation Task Force. While DRCOG has not taken a formal stance on the law, known as the Homeowner Protection Act, it is in the process of studying its effects.

“We met with the Colorado Home Builder Association, which regaled us with war stories of lawsuits that builders of for-sale units have lost,” said Taylor. “A short synopsis is that an unnamed law firm would purchase a unit, find something wrong and contact the HOA — required by law to be established — about a lawsuit. The HOA would join in a lawsuit against the builder for correction of the defect. To stop expensive litigation, the builder would settle.”

Taylor said other factors affecting building patterns include customer preference, foreclosures, the recession and overabundance of inventory.

The bill forced builders to stop the common practice of making buyers sign contracts that waived their rights to sue for claims of negligence. Realtors loved it.

“Realtors believe (the 2007 law) made homeowners who were victims of construction defects whole,” announced the Realtors Association in a flyer. “Homeowners that are legitimately victimized today still have a cause for action to recover damages.”

Builders and chambers of commerce, however, are supporting bills to decrease risk.

“Since 2007 … the percentage of owner-occupied, multi-family units built in the Denver metro area has declined from 25 percent of all units built to 2 percent,” reads a CHBA flyer. “With the increased risk of litigation, developers have clearly avoided construction of new multi-family development.”

City staff opened the door to more multifamily projects last year by applying for urban-center status from DRCOG. Those are defined as “active, pedestrian-, bicycle-, and transit-friendly places that are more dense and mixed in use than surrounding areas.”

Urban centers are often near light-rail stations, as a major focus is on reducing driving and the resultant pollution. The Englewood and Lucent stations, for example, are so designated. Ideally, according to DRCOG, many people who live in the area would also work there, thus the higher density.

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