Construction-Defects Reform Bill Passes Unanimously

HB1279 Bill

Condo construction is expected to increase, thanks to the new construction-defects reform bill. The bill changes laws and restrictions placed on builders, the repercussions of which have discouraged condo builders from developing for-sale condos in the past.

Designed to keep homeowners safe, construction-defect laws have historically placed full financial responsibility on condo builders, meaning a defect as small as a toilet being a few inches out of place could result in the entire complex suing the builders for defects. With such a high financial risk, most builders have opted for constructing rental properties and apartments instead of for-sale condos.

The result is a city that’s hurting for lower-cost housing. The lack of new builds is definitely felt, especially for those looking for affordability. The new bill seeks to incentivize new builds while continuing to protect homeowner rights. The compromise bill will, in fact, offer even higher protection to owners. It will require the majority of unit owners to vote before any construction-defects lawsuits are filed, instead of the HOA making the decision. Previous law only necessitated a majority of HOA board members to vote. Condo owners will now be required to be alerted to the potential impacts of a lawsuit on their selling or refinancing options. The bill does not stand in the way of individual owners with legitimate construction issues from pursing legal remedy, rather it protects condo builders from being sued by the HOA for illegitimate construction-defect issues.

HB 1279 was passed unanimously at the beginning of April by the Colorado House of Representatives. Sponsored by Democratic Rep. Alec Garnett of Denver and Republican Rep. Lori Saine of Dacono, the bill received no disagreement from House members.

Those backing the bill believe it to be crucial to encouraging new condo builds and a vital step for this booming city. The HOA coalition is in agreement, finding the bill to be a positive step towards creating more attainable housing options for Colorado residents while continuing to pursue its primary function of protecting homeowners and their right to pursue or not pursue litigation for legitimate construction-defect issues.

Those backing HB 1279 are encouraged by the positive and accepting response to the compromise bill-reform and hopeful for the opportunities it could create for more accessible housing opportunities for Colorado residents and newcomers.

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