DENVER (KDVR) — Colorado politicians are cracking down on rent algorithms that they say are driving up housing prices.

HB25-1004 passed through the Colorado House on Wednesday with a 43-22 vote. Lawmakers say it would restrict the sale or distribution of an algorithmic device with the intent that it be used by two or more landlords in the same or related market when setting a rent price.

Colorado House Democrats cited a December 2024 report from former President Biden’s White House that said coordinated rents from algorithmic pricing increased Denver rent prices by about $136 per month.

“In Colorado, it showed that rents are $1,600 higher a year because landlords are colluding, using this price-fixing software,” said bill sponsor Rep. Javier Mabrey, D-Denver. “Working people, people who cannot afford to own homes are spending an extra $136 a month in rent because landlords are using this technology.”

Opposers argue this bill may be anti-landlord and could cause them to leave the state.

“Rent is supposed to be a function of the marketplace and so a renter can go to a place and get one set of rents and then in theory, go to another place and get an entirely different rent structure. The argument is that instead of having that open marketplace, it’s somehow coordinated,” said MSU-Denver Affordable Housing Institute director and finance lecturer Andy Proctor, who provided insight on rent algorithms.

FOX31 reached out to the Denver Metro Chamber of Commerce in reaction to this bill passing in the House on Wednesday:

The Denver Metro Chamber strongly supports the bill’s intent to prevent anti-competitive practices in the housing market and ensure fair pricing. However, the bill’s broad language raised concerns around unintended consequences, potentially setting precedents that could make it harder for businesses to operate in Colorado. Sponsors collaborated with stakeholders to address numerous concerns regarding the introduced bill, and we greatly appreciate their partnership in this effort. While we look forward to further clarification on the use of publicly available data, significant progress has been made in mitigating unintended consequences

Denver Metro Chamber of Commerce VP of Government Affairs Carly West.

FOX31 also reached out to the Colorado Apartment Association:

We appreciate the bill sponsors listening to rental housing providers across Colorado about how these products are used and can save renters money. The amended bill helps avoid unintended consequences by allowing property owners to continue sharing publicly available information, making the rental housing market more efficient. Ultimately, that’s a win-win for both rental housing providers — who have units empty for fewer days — and renters who benefit from a more accurate valuation of their monthly rent.

The Colorado Apartment Association

The bill will now go to the Senate. If it passes there, it will then go to the Governor’s desk and could be signed into law.

“We are going to do everything in our power to help the people who are living paycheck to paycheck, which is 60% of the people in this country and almost all of them are renters,” said Mabrey. “Trust-busting and having a strong anti-trust enforcement is a bipartisan tradition in this country that dates back more than 100 years. What this bill does is it clarifies that if you are colluding with a competitor to set your prices using an algorithm, that is against the law.”

Read the full story on FOX31 | by: Kasia Kerridge