Colorado Rental Portfolio Guide
What you need to know before building or growing a rental portfolio in Colorado — property tax burden, state income tax, security-deposit rule, source-of-income law, and the metros that actually cash-flow after accounting for local taxes.
Tax burden on Colorado rentals
Property tax
0.55%
effective rate on median home value
At 0.55% effective, this is one of the lowest property tax burdens in the country (rank 3 of 51). Portfolio holding costs stay low even in appreciating markets — a big structural advantage for long-term holds.
State income tax
4.40%
top marginal rate
A top marginal rate of 4.40% is moderate. Portfolio income above the federal deduction stack still faces this rate on top of federal, so tax-optimized holding structures (installment sales, 1031s, cost-segregation) matter more here than in no-tax states.
Security deposit rule
No statutory cap on security deposits. Landlords set the deposit at whatever the market accepts — typically one to two months' rent, sometimes more for higher-risk applicants or pets. Local ordinances may still apply.
Deposit rules change; verify current statute before drafting a lease.
Best cash-flow markets in Colorado
Modeled monthly cash flow on a median-priced single-family purchase at 20% down, 30-year fixed, using Colorado’s 0.55% effective property tax rate plus 25% of rent for insurance, maintenance, vacancy and management.
| Market | Median price | Median rent | Annual property tax | CF / month |
|---|---|---|---|---|
| Pueblo, CO | $287,672 | $1,340 | $1,582 | $-635 |
| Sterling, CO | $255,446 | $1,091 | $1,405 | $-638 |
| Fort Morgan, CO | $332,588 | $1,415 | $1,829 | $-834 |
| Ca, CO | $343,335 | $1,476 | $1,888 | $-850 |
| Grand Junction, CO | $436,543 | $1,773 | $2,401 | $-1,159 |
| Montrose, CO | $498,133 | $2,140 | $2,740 | $-1,235 |
State median across the metros: $527,316 home, $1,919 rent, $-1,632/mo modeled cash flow.
Track your Colorado rental portfolio
The Pro Portfolio Tracker rolls up every property in your portfolio, auto-revalues them monthly against local price data, and flags DSCR risk and equity milestones. Each Colorado property carries the state-specific tax burden shown above through to the cash flow calculation.
Property tax rate: Tax Foundation. Security deposit rule: state statute. Verify current law before making decisions — statutes change and this page is a planning reference, not legal or tax advice.