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Tips For Buying a Home in Denver

Written By: The Orchard Team

June 19, 2020

If you’ve been thinking about buying a home in Denver, you’re not alone. In fact, a 2020 study named Denver the fastest-growing metro area among Millennials. With so many people hoping to settle down in the heart of the Rocky Mountains, it’s no surprise that the real estate market in the Mile High City is particularly hot right now.

To that end, we’ve brought you some tips for buying a home in Denver. Read them over so you know the steps you’ll need to take toward becoming a homeowner.

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Get pre-approved before you start house hunting

Many home buyers – both in the Denver market and nationwide – assume that the first step toward buying a home is to start looking at available listings online. However, the truth is that it’s hard to start looking at listings if you don’t have a good idea of how much you can afford to spend on a home.

With that in mind, it’s a good idea to talk to a mortgage lender and get pre-approved before you start house hunting. Getting a pre-approval letter from a lender will tell you how much you’ll be approved to borrow in a home loan.

On your end, having this document in-hand will make it easier to know what home prices you can afford. Down the road, you can also present this document to the seller when you’re ready to submit an offer to show that you’re serious about buying.

The process of getting a pre-approval is fairly simple. Once you’ve found a lender who you trust, you’ll need to provide them with a few financial documents, like recent bank statements and pay stubs. After they have everything they need, they should be able to give you a pre-approval letter within a few days.

If you’re a home buyer in search of more affordable homeownership, you may want to consider working with a lender who offers loan and down payment assistance programs for buyers in the Denver metro area. Look out for lenders who offer a variety of loan options for those buying a home in Denver. This includes FHA loans, conventional loans, and VA loans, as well as programs to make the upfront cost of buying a loan more affordable.

Get pre-qualified

Find a price point where the monthly payments work in your budget

Once you’ve found a mortgage lender you trust, and you have your pre-approval in-hand, it’s time to decide on your budget for buying a home in Denver. Remember that your pre-approval tells you the maximum amount that you’ll be allowed to borrow in a loan. So, you may not want to spend up to that maximum for your own budgeting purposes.

Instead, it’s important to find a price point where the monthly payments work in your budget, especially if you’re going to be adding a mortgage payment to existing debts like student loans or a car payment.

With that in mind, ask your lender to work up loan estimates at a couple of different price points within your buying power. Those documents will give you an idea of what you can expect to pay in a monthly payment. Then, work those figures into your budget, find a comfortable price point, and use that amount to guide your home search.

Narrow your neighborhood search list

Finding the right area to put down roots and buy a home can be tricky. Whether you’re a seasoned Denverite or new to town, you’ll need to do some research on different neighborhoods in the area.

Once you’ve gotten pre-approved, look at market trends and property values in neighborhoods you’re considering. This should give you an idea of how much house you can afford in each area and help you narrow down your options.

You’ll also want to consider less tangible things like school quality, safety, public transportation, commute times, and local amenities. Take some time to think about which of these factors you want to prioritize in your neighborhood search. Then ask any friends, locals, your real estate agent, or do some online research to figure out how each neighborhood ranks on your list. Check out this post on the best neighborhoods in Denver for families.

Search for the perfect home with Orchard

After you’ve settled on the right price point for your budget, it’s time for the fun part of buying a home in Denver: looking for a home. While traditional real estate methods might leave you searching through countless listings before you find one that checks all the boxes, the Orchard Home Match Quiz makes it easy to find the perfect Denver home that meets your needs.

When you’re ready to start touring homes, you can work with one of Orchard’s Home Advisors, a licensed real estate agent who will show you homes on your schedule. Once you’ve found your perfect match, your Home Advisor can help you put together a purchase offer that will set you apart from the crowd.

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