Landlords and property managers across Colorado, especially in the Metro Denver and South Metro Denver areas, are facing one of the most significant housing law changes in recent years. On May 29, 2025, House Bill 25-1240, also known as Protections for Tenants with Housing Subsidies, officially took effect.
This landmark legislation amends Colorado’s Fair Housing Act to make it illegal for landlords to deny tenants based solely on their source of income, including Section 8 Housing Choice Vouchers and other rental assistance programs.
As your local experts at PMI Elevation, we’re breaking down what this law means, what’s required. We also explain how landlords can stay compliant while keeping their properties profitable and well-managed.
Key Takeaways
All Colorado landlords, regardless of property size or type, must now accept tenants who use housing subsidies such as Section 8 vouchers. Refusing an applicant due to subsidy use is considered source-of-income discrimination under state law.
When tenants receive housing assistance or occupy properties with federally backed mortgages, landlords must provide a 30-day notice before filing for eviction for non-payment.
For tenants using vouchers or rental assistance, late fees cannot exceed $20, even if a lease states otherwise.
Landlords must maintain safe, habitable housing. If conditions violate habitability laws, landlords may be required to refund both the tenant’s and the housing authority’s payments for the affected period.
Violating HB25-1240 can lead to civil penalties starting at $5,000 per violation, and higher for repeat offenses.
What HB25-1240 Means for Metro Denver and South Metro Denver Landlords
The Metro Denver rental market is one of the most competitive in the state. With this new legislation, property owners must update how they screen tenants, write leases, and handle evictions to avoid potential violations.
1. “No Voucher Refusal” Is Now State Law
Before HB25-1240, many landlords could choose not to accept Section 8 vouchers. That is no longer legal. Denying or discouraging an applicant based solely on subsidy status, or applying stricter screening standards to voucher holders, is now discriminatory under state law.
2. No Exemptions for Small Landlords
Previously, landlords who owned only a few units were sometimes exempt from voucher-acceptance laws. HB25-1240 removed those exemptions. Whether you own one rental unit or fifty, the law applies to you.
3. Screening and Application Processes Must Be Equal
All applicants, including those using housing vouchers, must be screened using the same criteria. You cannot add extra steps or fees for voucher holders. Additionally, you must process applications in good faith and respond promptly to requests from local housing authorities.
4. Administrative Cooperation Is Mandatory
Landlords are now required to work with housing authorities on paperwork and inspections. Ignoring or delaying voucher documentation could constitute a violation. Timely communication with these agencies is essential.
5. Lease Terms and Fees Must Be Updated
Check your existing leases for late fee clauses, eviction notice timelines, and source-of-income language. Even if your lease was signed before May 2025, continuing to enforce non-compliant terms could lead to penalties.
How Landlords Can Stay Compliant with HB25-1240
As a property owner or investor in Metro Denver, here’s what you should do immediately to stay on the right side of the law — and protect your investment:
1. Audit your lease agreements
Review and revise any clauses about late fees, source of income, and eviction timelines to ensure they align with HB25-1240.
2. Update tenant screening criteria
Make sure your criteria focus on objective measures — like rental history, income requirements, and credit — and do not exclude subsidy recipients outright.
3. Train your team
Property managers and leasing agents should receive fair housing training specific to source-of-income protections. Even unintentional discrimination can lead to penalties.
4. Establish clear communication with housing authorities
Set up a system to track voucher documentation, inspection dates, and payment processing to prevent delays or compliance issues.
5. Plan for longer administrative timelines
Voucher approval and inspection processes may take longer than traditional leases. Build these timelines into your rental strategy.
6. Work with a qualified property management partner
PMI Elevation helps property owners navigate these changes by updating leases, training staff, and handling voucher communication on your behalf. This saves you time and reduces legal risk.
The PMI Elevation Advantage for Colorado Landlords
At PMI Elevation, we work directly with property owners in Metro Denver and South Metro Denver to adapt to evolving rental laws like HB25-1240. Our team has already updated our leasing policies, screening systems, and training modules to fully comply with the new rules.
We handle:
Lease and policy updates aligned with state law
Coordination with housing authorities for voucher paperwork
Rent collection and accounting for subsidized tenants
Maintenance and inspection compliance
Tenant education and communication
With PMI Elevation managing your property, you can stay focused on your investment without worrying about legal headaches or complex administrative requirements.
Frequently Asked Questions about HB25-1240 and Section 8 Acceptance
1. Do I have to accept every Section 8 applicant?
You must consider them on equal terms with all other applicants. If they meet your standard rental criteria (such as credit score or rental history), you cannot deny them because of the voucher. However, you may still deny applicants who fail to meet reasonable, non-discriminatory standards.
2. What if a tenant with a voucher pays late or violates the lease?
You can still enforce lease rules and pursue eviction if necessary, but you must follow the new 30-day notice requirement for non-payment if the tenant receives a subsidy or if the property.
3. Where can I read the official law?
You can review the full text of House Bill 25-1240 on the Colorado General Assembly’s official site and the DORA Division of Real Estate’s summary. For federal context on voucher programs, see the HUD Housing Choice Voucher Program overview.
Compliance Is Now Non-Negotiable
HB25-1240 has redefined fair housing in Colorado. Whether you own a single-family home or a multi-unit portfolio, you are now required to accept tenants with housing subsidies. You must also adhere to specific rules on fees, eviction notices, and habitability.
While these changes may feel overwhelming, they also create opportunities to serve a broader tenant base and stabilize occupancy in Denver’s dynamic rental market. Partnering with PMI Elevation ensures you’re compliant, profitable, and confident in navigating Colorado’s new rental landscape.
Learn more about how PMI Elevation can help you stay compliant with Colorado’s new fair housing laws. Contact us today!
