For the last four years, the homebuilders’ lobby has been aggressively pushing the idea that consumer protection laws are stifling condominium construction in Colorado. The lobbyists claim that the fear of liability for construction defects has forced many local developers to build apartments instead of condominiums. They have dismissed the notions that the shift to apartments merely reflects supply and demand, or that modern families might actually prefer to rent rather than buy. To support this theory, they have touted high condominium sales in other states. A new story from NPR’s Here & Now refutes this claim, however.
Contrary to what the lobbyists have been saying, data now confirm that large numbers of Americans prefer to rent, not buy, their homes. NPR reported today that home ownership in the U.S. fell to its lowest rate since 1965, while the share of U.S. households who rent is nearing a 50-year high. This trend appears nationwide and can hardly be blamed on consumer protection laws in Colorado.
This boom in apartments, furthermore, has not been bad for the construction industry. On the contrary, the report notes that demand for apartments is fueling a “construction resurgence,” and H.U.D. recently announced a new high in nationwide housing starts. In a recent interview, the chairman of the National Association of Home Builders credited apartment construction for this rise: “New household formations are upping the demand for rental housing, which in turn is spurring the growth of multifamily production…. Meanwhile, single-family housing continues to hold firm.”
Colorado legislators should remember these statistics next session, when the homebuilders make their annual pilgrimage to the Capitol to complain about how the state’s consumer protection laws are killing the construction industry. Just because builders are profiting from record-high demand for apartments does not mean that lawmakers should strip away consumer protections for those who choose to buy new homes.