Get ready, Denver — new rental inspection laws coming into effect in 2023 will affect all property owners and tenants. The city council approved these measures last year in hopes that these new regulations will force property owners to offer quality properties that are safe and well-maintained. The vision is a city where even the most affordable housing meets basic standards of living.

Denver’s New Inspection Law

New council policies require property owners to obtain a residential rental property license every four years. They’ll have to pass a third-party inspection. 

The rental licensing reforms will go into effect in three phases to hopefully alleviate some bottlenecks that could otherwise occur. Denver has around 54,000 rental properties, which will all require new inspections.

In 2022, all licenses are optional but will be offered at a reduced rate. Starting in 2023, they become mandatory for properties with two or more units in a single parcel like apartment buildings and duplexes. Then, in 2024, all individual living spaces must also have a license, including row houses and single-family homes.

Associated Costs

Licensing fees will be on a sliding scale based on the number of units in a rental property. The plan is to make licenses more affordable

  • Single dwelling unit: $50
  • Two to 10 units: $100
  • 11-50 units: $250
  • 51-250 units: $350
  • 250+ units: $500

These prices will be cut in half for anyone who applies in 2022.

Benefits for Property owners

Some property owners may be concerned the new law will require them to make costly repairs, putting them out of business. However, there’s a lot property owners can gain with regular inspections.

1.    Catch Problems Early

Often the most expensive repairs are a result of neglect or undiscovered issues. These minor problems build up over time and lead to more extensive damage. For example, a leaky pipe left unattended turns into flooding, wood rot and mold.

Tenants may not always know what to look for and may not report them to you right away. Rather than rely on their knowledge and communication, routine inspections can catch any minor problems so you can prevent more widespread and costly fixes.

2.    Check Rules Are Being Followed

Your lease agreement likely includes a series of rules and regulations you and your renters agree to abide by. Perhaps you don’t allow pets in your units or you charge extra for people living in the rental who aren’t on the lease.

Whatever those rules are, you have them for a reason. Regular inspections will let you know if your tenants are abiding by them. You can also get an idea of the general cleanliness of your tenants and whether they’re treating your property with respect.

3.    Avoid Vacancies

Not having tenants occupying your rentals eats away from your revenue and can severely affect your ability to pay the bills, especially if you still owe on the mortgage for the property. The best practice is to keep renters happy so you don’t have to spend time looking for new ones.

Routine inspections ensure you find and repair any damage and keep the property value up, which will impress your renters and make them more likely to stay. Then, if they need to leave for some reason, you have a high-quality apartment ready to go with hopefully no need for repairs.

4.    Reduce Liability Issues

You may be liable for any accidents on your rental property, either to your tenants or their guests. You could be found responsible and sued for damages if they can prove it was caused by a safety issue.

Having an assessment of any problems with the property every four years lets you correct those issues before anyone gets hurt. This protects your tenants and safeguards your financial well-being.

5.    Maintain Insurance Validity

You most likely have a property owners insurance policy to protect you and your assets in case of severe weather damage, loss of income or liability. However, many don’t realize routine property inspections are a requirement of most policies. The insurer wants to know you’re doing your due diligence to keep the property well maintained, so submitting to regular checks will keep your insurance current and valid.

6.    Create Relationship With Tenants

Checking in with your tenants from time to time will help you build a working relationship with them. Renters might feel more comfortable continuing their lease when they’re familiar with you. They might also be more likely to report any damages to the property. Regular inspections allow you just one more chance to be in contact with them outside of collecting rent.

Benefits for Tenants

Many tenants worry about routine inspections’ intrusion and invasive nature, but they can be incredibly beneficial.

1.    Have a Higher Standard of Living

One of the main goals of this new Denver city legislation is to protect the needs of renters. You have the right to a certain standard of living. Requiring regular checks may feel invasive, but they keep shoddy property owners from getting away with not maintaining their properties. Also, moving into an apartment with a recent inspection will likely make you feel much safer.

2.    Fix Problems Sooner

Have you ever had a property owner who promises to conduct repairs but keeps putting them off, making excuses and avoiding you? Now there’ll be more incentive for them to keep their word. They won’t be able to continue doing business unless they renew their license for the property every four years. The rental needs to be in good condition at that time or the property owner won’t get their permit. It isn’t a perfect system by any means, and they may be able to skate by in the interim, but this provides at least some measure of accountability.

3.    Improve Health and Safety

Minor issues can lead to unseen health hazards if you aren’t sure what to look for. For example, toxic mold can grow in areas with even the barest of leaks. Inspectors will check for difficult-to-spot hazards like radon and termites. Routine checks on your apartment’s condition can keep you and any loved ones healthy and safe.

4.    Avoid Damage to Possessions

Renter’s insurance can help you recoup the monetary loss of your items in case of damage, but it can’t replace the precious memories you might lose. Reporting any minor issues in your rental and submitting to routine inspections makes small problems less likely to become severe and lead to damaging fires or leaks. Catching things that need repair now can spare your possessions from possible harm.

Register Early

According to the Denver City Council, property owners will receive perks for applying for their licenses early. In 2022, they can get one for half the regular price. The hope is some property owners will take advantage of the discount and get it done early, scattering Denver’s inspections somewhat evenly over the next three years. That way, not everyone will come due at the same time.