Senate Concurrent Resolution 17-002: Real Estate Transfer Tax For Affordable Housing
SCR 17-002, sponsored by Senator Kefalas (D-Ft. Collins), was introduced on April 12 is scheduled to be heard on April 27th in the Senate Agriculture, Natural Resources and Energy Committee. The LPC today voted to oppose this concurrent senate resolution. SCR 02 deletes the prohibition in TABOR on new or increased transfer tax rates on real property. The concurrent resolution imposes a tax upon the recording of each real property deed at the rate of 1/10 of one percent of the value of the real property as specified in the deed for the privilege of transferring the title to real property (tax).
Unfortunately, without meaningful construction litigation reform, any money allocated to for-sale units would not be truly effective. Absent reform, affordable housing developers will not be building such units.
Although REALTORS® understand the need for affordable housing in Colorado, one of our bedrock principles is that you cannot make housing more affordable by making it more expensive. CAR is an affordable housing advocate. We have supported a host of legislative initiatives designed to create more affordable housing options. The creation and extension of the state Low Income Housing Tax Credit (LIHTC) program and legislation allocating a portion of the state’s unclaimed property trust fund to support programs that provide rental assistance and promote construction and rehabilitation of low-income rental housing are just a couple examples.
Last year, CAR passed legislation to create first-time homebuyer savings accounts to help Coloradans save for purchasing their first home. Additionally, we have donated more than $7 million through the Colorado Association of REALTORS® Housing Opportunity Foundation (CARHOF) to promote safe, decent and affordable housing for all in Colorado.
SCR 02 has several flaws. First, the transfer tax hurts the very families that it is intended to help because such a tax is regressive. It disproportionately impacts low-to-moderate income earners – those that can least afford it, which creates a barrier to homeownership. Down payment costs – including closing costs – remain a significant barrier to homeownership, especially for low-to moderate-income households. Two weeks ago, the Denver Post reported that Colorado is the nation’s epicenter when it comes to housing unaffordability. Specifically, seven of the 12 counties in the entire U.S. where housing affordability is out of balance are along the Front Range. Adding even more costs to purchasing a home would further reduce many families’ ability to achieve the American Dream of homeownership.
Second, real estate transfer taxes are not a reliable funding source. Real estate transfer taxes are extremely sensitive to market forces, making the frequency of transactions and value of property variable in relation to the strength of the economy, which makes real estate transfer taxes a poor revenue source to fund any government programs, let alone affordable housing.
Finally, real estate transfer taxes are unconstitutional under TABOR. This concurrent resolution would remove that prohibition against transfer taxes in Colorado’s Constitution.
Stay Tuned for a CALL to ACTION ALERT to Support Senate Bill 156!
The House State Affairs Committee will hear SB 156 on Wednesday April 19th.
This comprehensive defects reform bill is backed by the Metro Mayors Caucus, which represents 40 mayors and millions of constituents. It is also supported by the Colorado Municipal League, Habitat for Humanity and Housing Colorado, among others. And SB 156 passed the Colorado State Senate with bipartisan support. .
Colorado communities are lacking diverse and attainable housing options due to defects in state law. The near certain risk of protracted, multi-million dollar lawsuits has led to skyrocketing insurance rates and unacceptable business risks for condo builders. In 2005, condos comprised 20 percent of the metro Denver new housing market, while today it has plummeted to just 2 percent.
In an effort to bring housing relief to their communities, 17 Colorado cities and one county have passed comprehensive construction defects reform, but concerns that state law may pre-empt local regulations has continued to discourage new development.
SB 156 would fix problems in the current law by providing a common sense and balanced solution that protects consumers from faulty construction while also increasing diverse and more affordable options for home ownership.
The Homeownership Opportunity Alliance is a coalition of affordable housing advocates, business leaders, mayors and economic developers. Learn more by following @Housing4CO on Twitter or Housing4CO on Facebook.
Invest in RPAC
The purpose of RPAC is to support candidates that support REALTORS®. Our goal is to get pro-REALTOR® candidates elected at the local, state, and federal levels – candidates that share our support for homeownership, protect property rights, and who will listen to our concerns. Investing in RPAC is one of the easiest things you can do to protect your business. Our goal in 2017 is to raise $600,000 to continue to support our REALTOR ® champions and ensure we achieve the policy outcomes necessary to protect property rights. Click here to invest today!
RPAC Drinking for Diamonds at CAR’s Spring Conference
How would you like to win a diamond? Be sure to attend RPAC Drinking for Diamonds on Wednesday, April 26th – 5:30PM-7:30PM being held in Ludwig’s at the Sonnenalp Hotel in Vail, CO! $25 RPAC investment at the door / $99 RPAC investment for each entry in the diamond drawing…and the best part? 100% of proceeds will be invested in RPAC – your BEST investment in Real Estate. RPAC Drinking for Diamonds is sponsored by the Vail Board of REALTORS®.
Sign up for REALTOR® Party Mobile Alerts
More than 50,000 REALTORS® from across the country have already signed up for REALTOR® Party Mobile Alerts – have you? Text CO REALTORS to 30644 to stay up to date on REALTOR® issues! You’ll be among the first to know about NAR Calls for Action and more! Click here for more information.
Colorado Wildland Fire Conference
The Colorado Association of REALTORS® is a proud sponsor of the 2017 Colorado Wildland Fire Conference. Please plan to attend this event on April 19th-21st at the Pueblo Convention Center (320 Central Main Street, Pueblo, CO). This year’s conference will expand on the Fire Adapted Communities concept, providing the framework for moving from awareness to action. Anyone wishing to learn more about how they can reduce their community’s vulnerability to wildfire is welcome to attend. CE opportunities for REALTORS® will be also be available. For more information and to register, click here.
NAR Midyear Meetings in Washington, DC: May 15-20, 2017
The REALTORS® Legislative Meetings & Trade Expo is where NAR members take an active role to advance the real estate industry, public policy, and the association. REALTORS® come to Washington, DC, for special issues forums, committee meetings, legislative activities, and the industry trade show. Registration opens on February 15, 2017. Click here for more information.
Colorado Project Wildfire
Developed by the Colorado Association of REALTORS®, Project Wildfire is designed to help reduce the destruction of land, property, and lives. Working in partnership with other like-minded fire prevention organizations across the state, local REALTOR® associations are bringing education and awareness, as well as access to resources, directly to residents in their local communities. To learn more about Colorado Project Wildfire, click here.