In his State of the State address, Gov. Polis called for more affordable homes and rightly celebrated strides he and lawmakers have taken to tackle Colorado’s affordability crisis: passing model land-use reforms (prioritized and led by Gov. Polis) and other innovative policies as well as committing hundreds of millions in public funds to affordable housing. However, these funds have largely been directed to new development.

To truly close Colorado’s affordable housing gap, we need significant investments in preserving the affordable homes we already have. Otherwise, we’ll undercut any progress made through new construction.

Between 2011 and 2021, Colorado lost more than a quarter-million homes with monthly rents at $1,000 or less, according to Harvard’s Joint Center for Housing Studies. Very low-income renters have been particularly hard hit with a 40% drop in the number of homes available for less than $600 a month.

Colorado Housing and Finance Authority (CHFA) estimates that as of December 2024, statewide, there are more than 103,000 publicly funded units with affordability requirements. Over the next 15 years, 20% of those homes could lose income restrictions. In other words, 21,000 low-income households may well lose their homes if nothing is done.

Unsubsidized affordable homes are similarly at risk. These properties tend to be older, smaller buildings with fewer than 50 units often in need of repair. Letting this stock fall into the wrong hands would drastically compound our affordability challenges.

What steps can Colorado take?

Working with local officials to identify and take advantage of preservation opportunities at a neighborhood level can make a difference. The state’s recently enacted Right of First Refusal law gives local governments a fighting chance to purchase income-restricted properties and maintain their affordability.

But above all, we need more funds available to keep existing homes affordable over the long term. Lack of funding represents the single biggest obstacle to keeping existing homes affordable and viable. At the recent Colorado Affordable Housing Preservation Summit, we heard this loud and clear from over 100 experts from affordable housing, government, finance, philanthropy and advocacy organizations: We need more funding for preservation — for building acquisitions, renovations and long-term financing.

Local governments and housing authorities need to be able to quickly access patient capital to exercise their right of first refusal before others can swoop in and convert affordable apartments to market-rate ones. Mission-driven housing providers need capital with long payback periods to buy or refinance large buildings, and funding geared toward rehabilitating small affordable rural properties.

In 2024, four of Colorado’s largest nonprofit lenders — banks driven by mission rather than profit — were pitched dozens of preservation properties totaling about $85 million, but they lacked the capital to close the deals.

And this is a fraction of the financing needed. CHFA’s one-time $5 million preservation-specific pilot fund was allocated as soon as it launched. Its immediate success underscores the pent-up demand to take advantage of preservation opportunities.

Also worth noting: to keep an already-built apartment affordable and viable — with basic improvements and addressing deferred maintenance — preservation costs up to 50% less than new construction and avoids time-consuming processes like securing new land and rezoning. Rehabilitating an existing building can tap into funds for climate-resilient projects and create energy savings, healthier homes and reduced operating costs. Critically, prolonging existing affordability also curbs cost-driven displacement, keeping Coloradans housed and connected to their jobs, schools, and neighbors.

Gov. Polis can make good on his promise for more affordable housing by taking a “yes and” approach: yes to new construction, and yes to committing to preserving the homes we already have.

The first step is for state and other funding agencies to commit more existing affordable housing funds to preservation projects, not just new construction. State leaders and agencies then must think flexibly and creatively in working with lenders to create — and fund — preservation-specific financing tools.

The costs of inaction are already hitting the most vulnerable Coloradans.

Shaun Donovan is the CEO and President of Enterprise Community Partners. One of the nation’s foremost leaders in housing and community development, Donovan’s 30-year career in public service, including serving as HUD Secretary in the Obama Administration, has focused on building opportunity and fighting for people and communities too often left behind. Jennie Rodgers is vice president, Rocky Mountain, Tribal Nations, and Rural Communities markets leader for Enterprise Community Partners. Jennie has 30 years of experience in the arenas of affordable housing policy, finance and development, and has worked in the nonprofit, private and government sectors on urban and rural housing initiatives.