Why Colorado only has a handful of resident-owned mobile home parks
This story is a companion piece to the podcast The Magic City of the Southwest, produced by Magic City Studios in partnership with KSUT Public Radio. New episodes air on the first Sunday of each month at 2 p.m.
In 2016, a few Colorado lawmakers were hearing concerns from residents of mobile home parks. At the time, Edie Hooton was a newly elected state representative from Boulder.
“We started having town halls, then more mobile homeowners would come to my town halls,” Edie Hooton recalled. Hooton heard complaints about rent increases, unfair evictions, and a lack of landlord transparency.
By 2018, Hooton and other lawmakers received a report from Colorado’s Department of Local Affairs that said existing state laws were inadequate and needed overhauling to protect mobile home park residents.
As she learned more, Hooton became concerned about the rising number of out-of-state mobile home park owners.
“There would be no notice for eviction or really flimsy grounds for eviction,” Hooton said. “There were no restraints on the raising of rents, which is how the parks make their money, and often the rent would far exceed what was affordable for homeowners.”
In many instances, these investment companies used tactics to maximize profit.
“That's what upset me the most,” said Hooton. “You have these large, distant organizations strictly investing in Colorado mobile home communities for the investment value. Like squeezing blood from a stone.”
Many mobile home residents own their homes but often don’t own the land underneath. Technically, a homeowner can move a mobile home, but doing so is prohibitively expensive. So these owners often have a strong incentive to pay rent increases, even steep ones.
Hooton convinced fellow legislators that mobile home park residents were a critical constituency and helped lead an overhaul of Colorado statutes. 2019’s Mobile Home Park Act Oversight and 2020’s Mobile Home Park Act Update gave residents new rights and a more robust enforcement system. It was the first overhaul of the Mobile Home Park Act since 1985.
Hooton and her colleagues lost some battles. They withdrew an amendment that would have limited the ability of owners to increase lot rents in mobile home parks. After landlords expressed opposition to the bill, Colorado Gov. Jared Polis threatened to veto the amendment if it passed.
Among Hooten’s proudest achievements is the so-called “opportunity to purchase” law. If a mobile home park owner decided to sell a property, the 2020 law granted residents 90 days to make an offer. Hooton and her colleagues believed the law would ultimately increase the number of resident-owned parks.
“My endgame has always been that every mobile home community in Colorado be owned and operated by its residents and that it not be an investment tool for private equity firms out of New York or anyplace else,” Hooton told the Colorado Sun in 2022.
Resident ownership is still rare in Colorado
Edie Hooton’s endgame is still a ways off. Colorado lags behind states like New Hampshire, where 30% of mobile home parks are resident-owned.
Out of the more than 900 mobile home parks in Colorado, less than a dozen are owned by residents. (Out-of-state investors own about 600 parks.)
It’s difficult to untangle all the factors that have dampened Colorado’s move toward resident ownership, but many critics believed the "opportunity to purchase" law needed retooling, starting with the law’s 90-day window.
“That was a really tight timeline to be able to pull together a multi-million dollar transaction,” said Rep. Andrew Boesenecker of Fort Collins, who has been a champion of mobile home park residents since he took office in 2021.
Last year, Representative Boesenecker sponsored legislation increasing the time residents can submit an offer to 120 days.
The updated law also granted residents more leverage when they make an offer
The original law required an owner to consider an offer in “good faith.”
“Using good faith negotiations is a very low bar,” said David Valleau, an attorney with the Colorado Poverty Law Project. “So the law was a little bit flawed.
The 2022 amendment allows residents to transfer their purchasing rights to a public entity, like a municipal government, a state agency, or a housing authority, and the new law gives that public entity a right of first refusal to purchase the mobile home park.
“If that public entity submits an offer on behalf of residents, the landlord has no discretion to say no,” Valleau said. “They have to accept the offer provided it meets all of the offer requirements.”
And there’s at least one more reason Colorado doesn’t have many resident-owned parks yet: we’re new to this.
“The opportunity to purchase legislation in Colorado is still just a couple of years old,” said Mike Bullard, vice president of communication at ROC-USA, an organization that helps residents buy mobile home parks nationwide.
According to Bullard, Colorado’s overheated real estate market has limited the opportunities for residents to buy. “I think the big driver was the affordability in Colorado coupled with interest rates starting to skyrocket from historic lows, causing sticker shock,” he said.
Property values have been rising quickly for several years. More recently, interest rates shot up too. That means fewer mobile home parks were coming on the market, and when they did, residents had trouble getting financing.
Last year, ROC-USA partnered with several banks and non-profits in Colorado to set up a $55 million fund to finance purchases. “Traditionally, if a group wanted to buy this property, they would have to have 20 or 30% down,” Bullard said. “With our model, we lend up to 110% of the loan to value. And that allows the homeowners' financial contribution to stay low. It also gives them some money upfront to do that due diligence before the purchase.”
Resident advocates are confident that in the coming decade, Colorado will see a significant increase in the number of resident-owned mobile home communities across the state.
Edie Hooton is cheering on her fellow legislators from the sidelines. She’s now retired from office.
“The fact that we've got as many resident-owned communities as we do now, it doesn't seem like a lot, but it seems like a lot to us,” Hooton said. “And there will be more.”