New condos are hard to find in Colorado. Getting developers to build more will roil the Capitol next year.

Construction defects liability has been politically fraught, but the failure of Gov. Jared Polis’ signature land-use measure has reignited the push for lawmakers to take on the issue

Homes at the Virginia Village neighborhood are seen Sept. 27, 2023, in Denver.
Olivia Sun/The Colorado Sun via Report For America

New condominium construction in Colorado has plummeted over the past two decades, meaning people scouring real estate listings for a home they can afford are unlikely to find one of the most common types of entry-level housing.

Builders say the reason for the decline is simple: Colorado laws lack guardrails, leaving developers susceptible to costly lawsuits over things like leaks, concrete leveling and defective cabinetry, which in turn makes it too difficult and expensive to find insurers willing to underwrite condo projects. State law prevents builders from limiting buyers’ right to sue and spreads liability for any construction errors among all the contractors and subcontractors who work on a project, even if they didn’t cause the defect.

“It’s not that people don’t want to take responsibility for (their) product,” said Dave Lemnah, president of Lokal Homes, a Colorado developer that builds condos. “They really do want to take responsibility for their condo product. It’s just that we’ve got such an uneven playing field.”

The attorneys filing the lawsuits say builders are just looking to maximize their profits. 

“The building industry could easily put me out of a job,” said Chad Johnson, a Colorado lawyer who represents homeowners in lawsuits against builders. “All they have to do is not be negligent.”

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