Q: Month-to-month lease: Our landlord wants to impose a 50% fee to make us sign after raising rent in the last year. Legal?
Our rent was last raised in July. C.R.S. 38-12-702 is supposed to prevent landlords from raising rent more than once in the last 12 months, even for month-to-month leases. Our real estate company wants to impose a 50% fee for month-to-month renters in order to "incentivize" signing a new lease at a better-for-them market rate. They argue that the fee goes around this law, but this feels like a transparently evasive maneuver. Is this really legal? If so, does having to sign a new lease at a different rate supersede the law to not be able to raise the rate?
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A:
It depends. If the 50% fee is a holdover fee, then it may be legal. If it is a late fee or rent increase, then it becomes more doubtful. Late fees should not be close to that amount. A rent increase can be to any amount provided they meet the timeframe requirements.
If the fee is not included in the original lease, I am not sure how they would avoid it not being classified as a rent increase. Because the law is so new there is not a lot of case law on the subject yet. Regardless, you will need to talk to an attorney. It sounds like your landlord is experimenting with ways to get around the new COVID laws. The wording in the contract will be key to any discussion.
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