Never having sipped the potent and prolific Kool Aid dished out by housing developers and homebuilders, I can come at the problem of dwindling affordable housing in Aurora and the metro area with a sober mind.
City officials and some state lawmakers here and across the region, however, are clearly drunk on the stuff.
I’ll certainly agree that the price of homes in the metro area is sky high. It’s surreal that Denver cannot build luxury homes and condos fast enough, and the price for them just keeps getting higher.
The bad news is that those who don’t make $200,000 a year are getting squeezed out of the housing market all across the region, and especially in Denver. This Realtor’s dream is a nightmare for regular folks.
Denver Mayor Michael Hancock and Aurora Councilwoman Molly Markert are among those begging state lawmakers to solve their cities’ problem. Since both electeds have for years drunk mightily from the endless fountain of political contributions generously shared with all kinds of politicians, it’s easy to see why they and many others are receptive to lending builders their elected ears.
Hancock and Markert have agreed with the unlikely state Senate team of a Grand Junction Republican and Commerce City Democrat in why there’s so few affordable places for regular folks to live, and what the solution is. They believe that builders just can’t make “affordable” housing projects happen because it’s just too easy to sue condo builders for projects that later need a few repairs. These builders say that if they didn’t have to fret so about a bunch of lawsuits, they’d be raising the roofs on glorious and cheap condos on just about every vacant lot on the Front Range.
Uh huh.
So for those of you who spend more time buying houses rather than taking campaign donations from those who build them, here’s the sober truth: We’re playing Oil Boom Bingo — again. Money comes in. Prices go up.
The metro area has a real embarrassment of riches these days. Oil and other hot industries are bringing all kinds of flush folks here, and they have an appetite for pricey cars and urban housing. So if you’re a builder, would you rather build 100, $150,000 condos, that you make slim margins on by the time you walk away from the last closing, or would you rather build 100, $700,000 condos, making even better margins while buyers line up to give you their money? If you’ve avoided home-builder Kool-Aid, the answer is easy. And that reality sucks for those who aren’t making fat paychecks and want a mortgage they can qualify for.
Let me interrupt the fantasy shared by Hancock, Markert and the statewide association representing them and hundreds of other city officials with a little recent history reminder. There are and have been lots of trustworthy, quality, upstanding builders in Aurora and across the region. And there have been some of the most despicable, incompetent nail pounders in the country. One of the most lucrative businesses in the region during the 1980s was mudjacking. Mudjackers fixed thousands of crappy foundations built under crappy homes and condos, a virtual scourge across the Front Range created by crappy homebuilders.
The last time state lawmakers tried to diddle with legislation for the sake of enriching homebuilders, scores of people lined up to tell endless horror stories of being ripped off by having to fix what homebuilders should have. That resulted in the voter-led Homeowner Protection Act of 2007. Fed up with homebuilders calling the shots on city councils and the state legislature, Colorado voters struck back at incompetent homebuilders and “fix it first” laws. Despite dire warnings of the homebuilding industry collapsing in Colorado if voters approved it, voters said, “hell, yes.” Consumers know city building departments have signed off on crappy construction along the way. The only thing that stands between a struggling condo owner and financial disaster if the ceilings start caving in, is the ability to have courts force the builders to make good on what they should have done right in the first place.
Senate bills 177 and 91 do nothing but protect unscrupulous or incompetent homebuilders. As critics in the legislature have shown, there is no evidence, none, that measures like this in other states prompt the construction of so-called affordable housing.
If there’s a way to change these bills to honor Colorado’s 2007 act by ensuring the right for shoddy construction victims to have their day in court, produce it. But what’s being offered now is nothing more than loosening the grip on a industry that has repeatedly shown needs serious regulation for the good of the public.
Housing should be affordable … and I’m talking affordability by means of rentals via Section 8 or subsidized rentals. Home ‘ownership’ must remain in the capital marketplace … or, within a couple generations we’ll end up with soviet-style housing for everyone except the top one percent. Today, most people who own their home can barely keep up with maintenance and property taxes, let alone kick in money to help others ‘own’ homes who cannot afford to pay the cost themselves.
Alas, socialism ultimately becomes shared poverty for the masses … bye-bye middle class is class warriors like Perry get their way.
So few facts, so much hyperbole here, I don’t even know where to start, other than to say Perry doesn’t know what he’s talking about when it comes to construction or development.
Bottom line – there will be no affordable condos unless the construction defects law changes. You can stomp your feet and hold your breath all you want, but it won’t change that reality.
Dave,
I usually admire your tirades.
But, you are so off here.
Flavor Aid and not Kool Aid.
See the Wiki article on Jonestown.
,dave
Excellent article. Look at any of these home builders websites and ads, and most claim high percentages of satisfied customers, brag about their ‘warranty,’ etc. So who are all these people suing them? They can’t have it both ways! When you sink that kind of money into a house and it leaks and has foundation failure, among other problems, it can financially ruin you.It’s not about cosmetic imperfections. Besides, most if not all these builders and their warranty co’s have an arbitration clause that prevents suing. Disputes are taken to private, industry controlled arbitration, where you can guess who usually wins since they run it. And forget about home buyers being able to get an accurate picture of a builder’s competence by “doing their homework first.” Unless it’s a big national builder with tons of online complaints and gripe sites, you may not find much, even if there’s a lot of dirt. Many state agencies keep complaints under wraps and the BBB is not a consumer org, it’s a business membership org, that is the bane of real consumer orgs who know how easily people can be misled by over reliance on it. With so few options to sue a builder, court records don’t reflect how many lawsuits there probably ought to be. This industry does NOT need more protection,it needs to be held strictly accountable for the largest purchase most people ever make. If they can’t do that they should get in another line of work. I’m so sick of American business ethics that are all about shortcuts and lobbying, and not enough about quality.
Do you want more affordable condos to be built in Denver?
Not sure what point that is aiming at. I won’t make assumptions. I will say that there’s nothing affordable about defectively built houses. Defect cases can financially destroy the owners. if they end up abandoned and bank owned that’s not really good for the neighborhood either. It’s a fallacy that taking shortcuts and being immune from accountability is about affordable homes. I’m old enough to remember a time when builders had a regular crew and did things right. And yet they weren’t being sued. They started to get sued because they took shortcuts that caused financial harm to home buyers.
“This industry does NOT need more protection,it needs to be held strictly
accountable for the largest purchase most people ever make.”–Absolutely. Housing is a permanent part of the landscape, usually makes up the greatest percentage of someone’s after-tax disposable income, and developments irrevocably alter the character of a community simply due to their impact on the social and built landscape. Increasing penalties for things like consumer fraud and negligent building practices should be a matter of course.
CSC, You sure said it like it is. I’ve worked with homebuyers all over the nation who were HADD by builders of their brand new homes. Water intrusion and foundation failure are the most common and costly complaints. When there is no recourse to force the builder to do proper repairs families often lose their life savings. It is a tragedy that lobby money is more important to legislators than the well being of their constituents, but that seems to be the world we live in today.