How Much House Does $500K Really Buy You in Denver?

Shop at a lower price to be ready for potential bidding wars.

We wanted to know what $500,000 might buy you in the red-hot real estate market of Denver's metro area. This price tag is below Denver's current average price for all home sales and quite a bit lower than the current average price for a single family home. But it has a good chance of being affordable for two working adults with a median income for the Denver area.

Note that our list only includes homes that are priced below $500,000. That's because bidding wars are the norm right now, and most Denver homes are selling for above the asking price -- by an average of $30,000. So it's reasonable to expect to pay more than the list price if you're shopping for a home right now. That's why we think these represent what a $500,000 home shopping budget will really get you.

At the time of writing, these homes are all listed on Zillow.com.

One-bedroom condo in Denver's S*PARK community

If you've ever wished for a chance to live in a hip, urban apartment just blocks away from restaurants, taverns, and Colorado Rockies baseball games, now's your chance. This River North Art District unit is located at 2525 Arapahoe St., in the agrihood community of S*PARK. Just completed in 2018, this development was built to be green and includes:

• Solar power
• Garden beds
• Compost concierge
• Private park
• Greenhouse

You'll love the apartment's 10-foot ceilings, and every unit has outdoor space. At 800 square feet, it's a spacious one bedroom, one bathroom condo. Perfect for a couple.

This condo is listed for $465,000 by Leilani Renteria of Slifer, Smith & Frampton Real Estate.

Luxurious two-bedroom condo in the heart of Denver

This sunlit condo at 925 N. Lincoln St., is located in an upscale downtown residential highrise. It's spacious enough for a small family, with more than 1,100 square feet (two bedrooms, two bathrooms). You'll enjoy beautiful views of downtown Denver and the mountains beyond from the comfort of your sofa or your private balcony.

A few of the many amenities include:

• Pool
• Hot tub
• Rooftop deck
• Fitness center
• Garden
• Building concierge
• Two private parking spaces

This condo is listed for $469,000 by Sam Boren of Redfin.

Three-bedroom home with a yard close to downtown Denver

If you prefer a detached single family home to apartment-style living, this is a three-bedroom, two-bathroom cottage in the Barnum area.

Located at 263 N. Lowell Blvd., this home comes with nearly 1,500 square feet and plenty of outdoor space, perfect for a family. The listing says that a portion of the home has a separate entrance, so you could live on one side and rent the other. Inside, the home has been recently updated, while outside, mature trees provide pleasant shade front and back, and the backyard is fenced for your kids or furry family members.

It is in walking distance to a dog park, mountain bike park, and rec center.

This home is listed for $458,900 by Szymon Dzienis of Your Castle Real Estate Inc.

What's making it so hard to buy a home in Denver?

In most of the country, there are more buyers than homes for sale. That drives up prices and puts buyers into competition mode for each home that sells. Plus, investors have flooded the market. They usually make cash offers, which can be more appealing to the seller than an offer that is contingent on securing a mortgage.

How to improve your chances of buying a home

It's hard to present the perfect winning offer. You might try several times before you succeed, but there are a few things you can do to strengthen your position as a competitive buyer:

Pay off other debt. A low debt-to-income ratio will help you qualify for a bigger mortgage, which can be helpful in a rising market.

Stay within your budget. Make sure you know how much home you can afford. Use a mortgage calculator to help and keep the chance of a bidding war in mind.

Get pre-approved. Don't make offers without a mortgage pre-approval letter, which will show that you have a lender standing by who has already approved your loan.

Waive contingencies. Today's market is so competitive, some buyers are waiving contingencies to show the seller that they are ready to help facilitate a quick, sure transaction. There are pluses and minuses to doing this. Common contingencies in a home-buying transaction include:

• Home inspection: This contingency says you have the right to back out of the purchase and get your earnest money back if the home inspector finds an issue with the home that you don't want to deal with. The downside to waiving it is that you'll risk buying a home that needs a costly repair.
• Financing: This contingency says you don't have to make good on your offer if your financing falls through. A seller might prefer to work with a buyer who has the money in hand. The downside to waiving this contingency is that you are obligated to buy the home even if for some reason your mortgage doesn't get approved.
• Appraisal: This contingency says that you can back out of the sale and get your deposit back if the home doesn't appraise for the expected value. The downside to waiving it is that you're obligated to buy the home even if the appraisal comes in low. Keep in mind that most mortgages are contingent on the appraisal. If the appraisal is lower than expected, your lender might reduce the maximum loan amount and you'll have to pay the difference in cash (or get the seller to agree to a lower price) in order to buy the home.
• Home sale: This contingency says you don't have to buy the home if your own home doesn't sell within a specified period of time. Obviously many people can't buy the next home until the first one sells. But a seller might not want to get tangled up in your other real estate transaction. It might be easier to sell your home first and live somewhere else while you shop for the next home.

Shop low. In some markets, homes are selling for 20% above asking price (and more). Talk to your real estate agent to find out the actual sales trends where you want to buy. That way you'll be able to take an educated guess on whether you need to offer more than the asking price, and if so, by how much. By looking at recent listings and sales, you'll be able to determine whether it makes sense to only look at homes that are listed low enough that you can offer significantly more.