Denver says housing costs driving out low-income families

The city of Denver says that its lowest-income residents are leaving the city due to the high cost of housing, while evictions were up 61% on average in 2023 compared to the average over the previous 15 years and businesses are reporting they are unable to attract and retain employees.

The report on the city's evictions and exodus of low-income residents was in a report given July 24 to the city's Safety, Housing Education & Homelessness Committee.

The city has proposed an increase to the sales and use tax 0.5% or by 5 cents on a $10 purchase, that would generate $100 million a year, according to the committee meeting documents.

Over the span of 15 years, the city averaged a little over 8,000 evictions a year. In 2023, when there were 12,900 evictions, according to documents.

The city pointed to housing costs that are driving out low-income residents. According to the city, median monthly rent increased from $1,049 in 2000 to $1,870 in 2022, when adjusted for inflation. That's a 78% increase over the 22-year period. From 2010 to 2019, 10,595 low-income households left the city.

The city said housing costs are the main reason for homelessness.

“Denver cannot be a vibrant, inclusive city without ensuring that teachers, nurses, first responders and seniors can continue to call Denver home,” said Mayor Mike Johnston in an email to The Center Square. “There is a tremendous shortage of affordable homes for long-time residents and new residents alike, and this shortage will only grow if we don’t take action now. The Affordable Denver Fund provides a clear path to meet Denver’s affordability needs and establish a community where anyone can build a vibrant life here, especially the workers who are serving, caring for, and teaching the residents of this city.”

The Affordable Denver Fund Safety Committee reported that 50% of Denver renter households are “housing burdened.” This includes 80% of those earning less than $75,000 a year, stating that between 2010 and 2019, 21% of residents earning 0-60% of the Area Median Income (AMI) had left Denver. The document also shows that housing costs have increased by 218%.

“The cost of housing is one of the most significant issues facing Denverites today, in fact, new polling shows that 90% of residents see the cost of housing as a significant concern. Mayor Johnston is committed to acting with urgency to address this issue at the scale it deserves and has been working around the clock with the five council sponsors to ensure the ballot measure directly addresses our city’s affordable housing needs.” said Jordan Fuja, press secretary to the mayor said in an email to The Center Square. “We know that the longer we wait, the more difficult and more expensive it will be to address Denver's housing crisis, which is why we will continue to partner with Council to finalize the most effective ballot measure possible. And then we must ensure we place the measure on the November ballot, so voters have the opportunity to make their voice heard on this critical issue.”

Denver’s three housing resources include the affordable housing fund, created in 2016 and generating approximately $42 million annually; the Homeless Resolution Fund, created in 2020, generating approximately $50 million annually in sales tax; and the Affordable Denver Fund, which proposes a .5% sales tax to generate $100 million annually. Approximately 80% of funding is used to create and preserve projects, 20% is used for rental assistance, supportive housing, or down payment assistance, and up to 8% is used for administration, according to the documents.

Denver has two main plans geared toward affordable housing: Denver’s Comprehensive Plan 2040, which was adopted by the Denver City Council in 2019, a 20-year plan that focuses on an affordable and inclusive Denver, and the Department of Housing Stability’s (HOST) 5-Year Strategic Plan, approved by the city council in 2021. Both plans focus on preserving and creating affordable homes.

The 2023 Point in Time study by the Metro Denver Homeless Initiative reported more than 5,800 people experiencing homelessness. The study stated the high cost of housing as one of the main reasons for homelessness.

The city council also approved a .34% sales tax for the November ballot, which, as previously reported by The Center Square, will raise approximately $70 million for Denver Health.