Opinion: It’s time to lock in affordable housing stock before the market snaps it all up

East Colfax always was the kind of neighborhood where people could reliably find affordable housing close to downtown Denver, and it was predominantly home to families of color, one result of redlining policies that dictated where people could and could not live. Then the housing market crashed and nearly 20 percent of homes in the neighborhood went through foreclosure.

As the economy recovered, banks sold these homes to wealthier families, starting a cycle of gentrification and displacement that has left far too few homes affordable for East Colfax residents. 

This process has repeated itself all over Denver, as longtime residents are displaced and forced to either relocate or spend far too much of their monthly income on rent. Currently, Enterprise Community Partners estimates the Denver metro area has 292,000 housing units that are affordable to families earning up to 60 percent of the area median income. Nearly 90 percent of those homes have zero protections in place to ensure they will remain affordable long term—meaning rents are rising, and affordable homes are disappearing faster than we can create new ones.

Fortunately, we know that preserving affordable housing is possible. The Colorado Housing Preservation Network database of the state’s income-restricted rentals indicates that, since 2016, subsidies for nearly 14,000 affordable units that otherwise would have expired, instead have been preserved. It is time to redouble our efforts to preserve the 90 percent of affordable units that currently do not have income restrictions in place.  

The first challenge to preserving affordability is understanding where those homes are located. According to preliminary analysis by CSU’s Colorado Futures Center, more than 65,000 apartments in metro Denver are located in buildings with fewer than 50 units. Nationally, buildings of this size house 60 percent of all renters who make less than $10,000 per year.

In May, the Denver City Council enacted new legislation requiring all landlords to have a license in order to rent properties, which allows the city to maintain records of how many units are available, and to direct support and resources to those that are at risk of becoming unaffordable. But reaching landlords across the state, particularly those who own smaller buildings, is a monumental task; only a few communities are currently operating rental licensing or registry programs.

Once properties are identified, communities need to keep them affordable. Now is the time to act as federal and state resources are being made available to support affordable housing and the need in Colorado persists. 

Colorado is the sixth fastest-growing state in the country, according to the 2020 Census. We must take steps to protect and preserve the affordable housing that Colorado already has—before it is lost to pressures from the market. 

Colorado can create new tools specifically designed to assist landlords of smaller properties, who often receive little support or are unaware of the resources available to help them maintain their affordable units, such as technical assistance on how to reduce operating costs.

Colorado can consider policy changes, such as property-tax rebate programs for owners of lower-cost apartments to help counter the impact of gentrification, or provide low-cost capital and technical resources to existing owners of small multi-family properties in need of health, safety, and other capital improvements.

These efforts can help landlords who operate on thin margins and often have little choice but to raise rents when property taxes rise.

When homes are still at risk from escalating rents despite efforts to maintain affordability, public-private partnerships should be ready to step in to help preserve them. The Colorado Housing and Finance Authority, the Colorado Division of Housing, the City of Denver, Enterprise Community Partners, and private philanthropies are exploring a pilot program that aggregates and dedicates resources and would efficiently and rapidly deploy funds to purchase and preserve affordable homes. Critical resources like this must be brought to scale. 

In East Colfax, housing agencies and members of the Preservation Network are getting to work. Colorado Futures Center data revealed that much of the affordable housing stock in the neighborhood is within small, unrestricted, and older rental properties.

Families rely on these affordable rents to make ends meet, and rising rents will mean rising displacement. With new tools in hand, we can keep residents in place across the state.

Jennie Rodgers is vice president and Denver market leader for Enterprise Community Partners, Inc.