DENVER — At the State Capitol, Democrats are coordinating so Colorado landlords can’t when it comes to setting rent prices.
House Bill 25-1004 passed through the Colorado House of Representatives after a party-line vote Wednesday.
The bill would ban “with certain exceptions, the distribution and use of an algorithmic device by a service provider or landlord to set rents and other certain commercial terms regarding the occupancy of rental housing is prohibited.”
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A report released in December by former President Joe Biden’s White House, which no longer appears on the White House website, claims Denver renters paid an extra $136 in rent each month in 2023 to landlords who used rent-setting algorithms.
“What these companies are doing is they're replacing what used to be a smoke-filled back room with a computer algorithm, and we're clarifying that that's not okay,” said Rep. Javier Mabrey, one of the sponsors of HB25-1004.
Last year, Colorado joined seven other states and the Department of Justice in a lawsuit against a Texas company, RealPage, accused of sharing non-public information with landlords as part of a pricing scheme.
“We need to stand up and say, ‘Enough is enough,’” said Mabrey. “We're not going to wait for the courts, and this is illegal in the state of Colorado.”
Republicans like Rep. Chris Richardson would rather see that lawsuit play out first.
“If these algorithms are as they're purported to be, trying to push prices as high as possible, I don't think they're doing it,” he said.
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Denver metro rents have recently dropped. Our partners at the Denver Post analyzed data from the Apartment Association of Metro Denver, which showed a 1.5% drop between the beginning and end of 2024.
Richardson worries this and other bills being discussed in the legislature that aim to keep landlords accountable end up going too far.
“In my communities that I represent across Eastern Plains, [landloards are] small businessmen,” he told Denver7. “Their moms and dads are elderly that have downsized. They've kept their house. They're renting it out. They're housing providers.
“I just don't think we need more regulation, more legislation in this space where any time the government interferes, we distort the market, and the results are going to be unexpected.”
The Colorado Apartment Association told us in January these algorithms are a “critical tool” for measuring the market.
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Mabrey said there’s been some compromise in advancing this bill.
“We put an amendment in the bill that said landlords are not liable unless they knowingly participated in a scheme to fix prices,” he explained. “And so if you're a landlord in the state and you're not knowingly participating in a scheme to fix prices, you have nothing to worry about.”
Proving that could present another challenge if the bill goes on to become law.
The next stop is the Colorado Senate, where a similar bill died last year. Mabrey accuses lobbyists for RealPage of pushing for and adding an amendment on that bill “that ruined its ability to have any effectiveness,” causing Senate Democrats to split on whether to support it.
“I'm confident that it's going to get passed [this time] because some of the Democratic senators that voted with the Republicans to kill it were replaced by Democratic senators who co-sponsored it when they were members of the House,” he said Wednesday.
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