Legislators across the United States are cracking down on apartment landlords using extraneous, often undisclosed charges, with Colorado becoming the latest state prohibiting so-called junk fees.
The new law, officially signed by Gov. Jared Polis, bans commercial property owners from charging tenants fees along with their monthly rent payments. It's a practice common throughout the multifamily industry but has drawn mounting criticism in recent years among renters and housing advocates who claim they lead to misleading expenses.
Aimed at increasing price transparency, the new law requires companies to show the total cost of a product or service, including any mandatory charges or fees. For apartment landlords, that means they must advertise the total cost for renting a unit rather than touting a lower base rate and then tacking on additional fees for services such as controlling rodents or collecting trash to extract more revenue from renters.
“Unexpected, undisclosed fees cost consumers hundreds of dollars every month,” Democratic Sen. Lisa Cutter, one of the bill’s sponsors, said in a statement to CoStar News.
She added that “these ‘junk fees’ can make informed budgeting decisions feel impossible for consumers. Our legislation will increase transparency for consumers, helping them make informed purchase decisions and ultimately save more of their hard-earned money.”
The law, officially known as the Protections Against Deceptive Pricing Practices, takes effect at the start of 2026.
Eliminating 'junk'
Even with the fierce political divide on both the state and federal levels, addressing junk fees has attracted bipartisan support and appears to be popular among voters frustrated with hidden expenses scattered across a myriad of industries.
Minnesota's price transparency law kicked off earlier this year and prohibits restaurants and others in the hospitality business from charging additional charges such as health and wellness charges on a diner's bill, liquor fees on a catering order, a convenience surcharge for a concert ticket, or other expenses that aren't disclosed upfront.
Other states including California have a grab bag of laws aimed at banning various junk fees, and the federal government last year proposed a nationwide ban on the unpopular expenses that remains on the table but has yet to progress under the current presidential administration.
Colorado's new law lands a little more than a year after legislators in the state began targeting individual landlords accused of charging tenants extra fees for services that should be included in base rent amounts.
Greystar, a global real estate firm with a more than $74 billion national multifamily property portfolio, was sued in early 2024 as part of a proposed class-action lawsuit claiming the Charleston, South Carolina-based real estate giant charges unnecessary fees for services such as valet garbage removal that it said many tenants are unaware of until after signing traditional lease agreements.
Along with Colorado, states such as Virginia, Washington and Vermont have implemented laws capping some tenant fees or eliminating them altogether.
The National Multifamily Housing Council trade group did not immediately respond to CoStar News' requests to comment, but it has publicly pushed back against the characterization of junk fees. Instead, the association has argued that many of the service charges are legitimate and comply with both state and local laws.
Property owners have also claimed that bills similar to Colorado's will result in higher rents as a result of fees being folded into base rates.
The recently approved bill takes the junk fee ban a step further by prohibiting landlords from charging fees for services property owners are required by state law to provide, such as pest control or common-area maintenance.
Rents across the Denver metropolitan area experienced a pandemic-induced surge that fueled annual growth to record-high levels. However, with one of the most active construction pipelines in the country and a slight downshifting in demand, rates have stabilized somewhat to settle at an average of about $1,850 per month, according to CoStar data.
Even so, that average makes the city one of the most expensive non-coastal markets in the country, a status that has become a critical underpinning to a variety of housing measures aimed at boosting access to affordable options and strengthening tenant protections.