Colorado’s largest landlord, Greystar, has agreed to a settlement that mandates it disclose the full rental prices for its apartments, addressing concerns over hidden fees. The agreement, announced on October 24, 2023, resolves a lawsuit brought against the property management firm by the Colorado Attorney General’s Office and federal regulators, who accused Greystar of misrepresenting rental costs to potential tenants.
Under the terms of the settlement, Greystar will pay a total of **$24 million**, which includes **$1 million** for regulatory oversight to Colorado and **$23 million** to the Federal Trade Commission (FTC) aimed at refunding affected renters across the country, including those in Colorado. The settlement requires Greystar to clearly list the complete rental price of its units in advertisements, which must now include any additional fees.
In addition, Greystar must specify whether these fees are optional or mandatory, explain their purpose, and indicate when tenants will be billed for them. This compliance must be achieved within **90 days** of the settlement announcement.
Phil Weiser, Colorado’s Attorney General, emphasized the importance of this ruling. “Addressing deceptive and hidden fees that trick consumers out of their hard-earned dollars is a top priority for our department,” he noted. “In this case, we took action against Greystar for doing just that and have held them accountable for their conduct which raised rents. Other landlords are on notice that cheating tenants won’t be tolerated in Colorado.”
Details of the Settlement and Its Implications
The settlement follows Greystar’s previous agreement with Weiser, related to accusations that it used a rent-setting algorithm to illegally coordinate rental prices with other landlords. This earlier settlement occurred just two weeks prior to the latest agreement and highlighted ongoing concerns about fair rental practices in the state.
In the current case, the lawsuit outlined how fees associated with renting at two Denver apartment complexes significantly inflated the actual costs beyond what was advertised. Christopher Mufarrige, director of the FTC’s consumer protection bureau, stated, “Greystar misled consumers by advertising low rent prices and then adding mandatory fees at the end of the sales process.”
The Colorado state legislature has taken further steps to tackle the issue of hidden fees in rental agreements. Following media reports regarding the burden of such fees on tenants, lawmakers passed legislation requiring increased price transparency. This law also prohibits certain charges, such as those for common-area maintenance, and is set to take effect on **January 1, 2024**.
Moving Towards Transparency
In a response statement, Greystar acknowledged the settlement’s role in promoting transparency within the multifamily housing sector. The company asserted that it aims to enhance clarity regarding the expectations set forth by the FTC for advertising rental housing, particularly the requirement to display the total monthly leasing price prominently.
As Greystar implements these changes, the broader rental market in Colorado and beyond may see a shift towards greater transparency. The implications of this settlement could lead to increased scrutiny of rental practices across the state, potentially affecting how landlords advertise their properties in the future.
As Colorado continues to address housing affordability challenges, this settlement serves as a critical step in protecting renters from misleading practices and ensuring they have access to clear and honest information about rental costs.
