How Much House Can You Afford in Denver? DTI Math and Tables

A Colorado household earning $125,000 a year with $500 a month in other debt affords a home priced at $450,000 to $520,000 at 2026 example rates; a household at $175,000 affords $620,000 to $720,000. The lender's number is the ceiling; the number below, which adds Colorado property taxes, metro district mills, HOA dues and hail-priced insurance to the mortgage, is the one to live with.

This guide shows the math a Front Range buyer needs, from Fort Collins to Colorado Springs with the Denver metro as the base case. Every rate here is an example, not a quote; the Kenna Real Estate Group runs the exact numbers for each buyer during the Colorado mortgage pre-approval.

Start with debt-to-income, because the lender does

Debt-to-income (DTI) is your monthly debt payments divided by your gross monthly income. Two versions matter.

• Front-end DTI: the full house payment (principal, interest, taxes, insurance, HOA and mortgage insurance) divided by gross income.
• Back-end DTI: the house payment plus every other debt on your credit report (car loans, student loans, minimum card payments, child support) divided by gross income.

The limits by loan type, as underwritten in 2026:

• Conventional (Fannie Mae and Freddie Mac): back-end up to 45 percent as the standard, up to 50 percent with an automated underwriting approval and strong reserves or credit.
• FHA: 43 percent as the manual standard, higher with an automated approval and compensating factors.
• VA: 41 percent as the guideline, with residual income (cash left after all bills) as the deciding test; there is no hard cap.

Utilities, groceries, childcare, phones, insurance on your car and retirement contributions are not in DTI. That is why a lender's approval feels larger than your budget: the lender is measuring whether you repay the loan, not whether you enjoy your life.

The 28/36 rule versus the Front Range

The old rule caps the house payment at 28 percent of gross income and all debt at 36 percent. On a $125,000 income that is $2,917 a month for housing and $3,750 for everything. At Denver metro prices, 28 percent buys a $400,000 home with 10 percent down at a 6.5 percent example rate once taxes and insurance are added, and the median Denver metro detached home closes above $600,000.

The Front Range reality: most 2026 buyers close between 33 and 43 percent back-end. The number that decides whether that works is what is left after the payment, not the ratio. A two-income household with no car payments and a 12-minute commute handles 40 percent; a household with two car loans and a Castle Rock to downtown commute does not.

Front Range payment table at example rates

Principal and interest only, 30-year fixed, 10 percent down. These rates are examples chosen to show the spread, not today's quote; a one-point move in rate changes the payment on a $550,000 home by about $330 a month.

Now the Colorado add-ons on the $550,000 row at the 6.5 percent example: property tax $230 to $540 a month depending on the county and metro district, insurance $210 to $375, private mortgage insurance $165 to $250 at 10 percent down, HOA $0 to $120 on a detached home. The full payment lands between $3,750 and $4,400 a month. At a 43 percent back-end DTI with $500 of other debt, that payment needs $118,000 to $137,000 of gross income; at 36 percent it needs $142,000 to $163,000. The Kenna post on the income needed for a $400,000 mortgage in Colorado runs the same math one price tier down.

Property taxes by county: read the real bill

Colorado property taxes are low by national standards in the older cities and high in the newer metro district suburbs, and the residential assessment rate is set by the state legislature and has changed in each of the last four years. Use the county treasurer's actual bill for any address, not a percentage. Annual ranges on a $550,000 home in 2026:

• Denver and Jefferson counties (Denver, Lakewood, Arvada, Golden, Littleton west of Santa Fe): $2,700 to $4,000.
• Arapahoe County (Centennial, Englewood, older Aurora, Greenwood Village): $2,800 to $4,500; Aurora east of E-470 and the newer Centennial metro districts run higher.
• Douglas County (Highlands Ranch, Parker, Castle Rock, Lone Tree, Castle Pines): $3,300 to $6,500; most homes built after 1995 sit in a metro district.
• Adams and Weld counties (Thornton, Brighton, Commerce City, Erie, Frederick, Greeley, Windsor): $3,000 to $6,500, with the newest subdivisions at the top.
• Boulder, Larimer and El Paso counties (Boulder, Longmont, Fort Collins, Loveland, Colorado Springs): $2,500 to $4,800.

Every one of these is public record. The Denver property taxes guide explains how the bill is built, and the Kenna post on what south Denver buyers pay in Arapahoe County by city compares Centennial, Englewood and Aurora line by line.

Metro district mill levies

A metro district is a special taxing district that repays the developer's bonds for the streets, water and sewer in a new subdivision. It adds 30 to 70 mills on top of the county, city, fire and library levies, and it stays on the bill for 20 to 40 years. On a $550,000 home that is $1,500 to $2,500 a year, or $125 to $210 a month, and it is the reason two identical homes in Parker and Littleton carry payments $200 apart.

Ask for the mill levy and the district's debt before writing an offer; the Denver special district and metro district tax guide shows where to find both. The Kenna post on how HOAs, metro districts and taxes affect Denver suburb buyers ranks the suburbs.

HOA dues in the Denver metro

Dues run $40 to $120 a month for a detached home in a small HOA, $250 to $600 for a condo or townhome where the roof, exterior, water and the master insurance policy sit in the dues, and $600 or more in downtown Denver high-rises. Highlands Ranch adds HRCA dues on top of any sub-association. Lenders count the full dues in the front-end DTI, so a $400 condo fee lowers the price you qualify for by about $60,000 at a 6.5 percent example rate. Read the Denver HOA rules and fees guide before touring attached homes.

Insurance with hail in the number

Colorado hail season runs May to September and the Front Range sits in the highest-loss hail corridor in the country, so insurers price the roof, not only the house. A $550,000 detached home runs $2,500 to $4,500 a year in 2026, with a separate wind and hail deductible of 1 to 2 percent of the dwelling coverage ($4,500 to $9,000 per claim) on most policies. A roof past 15 years old, a wildland-urban interface address in the foothills, or a prior claim pushes the premium above $5,000.

Get an insurance quote on the exact address before the inspection deadline, not the week of closing. The Kenna post on rising Colorado insurance costs and the true monthly payment shows how a premium change moves the DTI.

Mortgage insurance and the down payment

Under 20 percent down on a conventional loan means private mortgage insurance of roughly 0.3 to 0.9 percent of the loan a year, priced by credit score and down payment; on a $495,000 loan that is $125 to $370 a month, and it cancels at 20 percent equity. FHA mortgage insurance runs for the life of the loan at 3.5 percent down. Both count in DTI. For financing, the Kenna Real Estate Group works with Mike Oswald, VP of Mortgage Lending at Rate, NMLS 261003, Equal Housing Lender. You are free to use any lender. Compare Loan Estimates line by line, and read the Colorado home financing guide for the program-by-program rules.

Build your own number in five steps

1. Take-home pay minus real monthly spending (car, student loans, childcare, food, phones, retirement) gives the cash available for housing. Use that, not gross income.
2. Subtract $600 to $900 for the Colorado ownership costs that are not in the mortgage: utilities (Xcel Energy, water district, trash), sprinkler service, furnace service, snow and yard, and a repair fund of 1 percent of the price a year.
3. The remainder is the full PITI plus HOA you can carry. Divide by the payment table to find the price.
4. Check that price against the lender's DTI ceiling. If the lender's number is higher, ignore it; if it is lower, the fix is debt payoff or a larger down payment.
5. Keep 3 months of the full payment in savings after closing. Colorado's first hail deductible or sprinkler freeze comes in year one.

How to lower the payment on a home you already want

• Seller-paid rate buydown: a 2-1 or permanent buydown funded by a seller concession cuts the first years' payment; Denver metro sellers on homes listed more than 21 days agree to 2 to 3 percent concessions.
• Pay off a car loan before applying: a $450 car payment removed from DTI adds about $70,000 of purchase price at a 6.5 percent example rate.
• Shop the insurance: a Class 4 impact-resistant roof earns a premium discount with most Colorado carriers.
• Skip the metro district: an older Littleton, Lakewood or Arvada home at the same price carries $125 to $210 less tax per month.
• Credit repair first: a 40-point score gain changes both the rate and the PMI price; the Kenna Credit Care mortgage readiness program is built for that.

The Kenna post on making the payment work in any Denver rate market lays out the scenario planning, and the Colorado home buyer's guide and first-time buyer guide carry the process from here to keys. Photo: Dreamstime.com.

Where to go next

• Colorado mortgage pre-approval guide
• Closing costs for Colorado home buyers
• Colorado home buyer financial terms glossary
• The real cost of living on the Front Range
• Search every home for sale in Colorado
• Meet the Kenna Real Estate Group agents

Talk to the Kenna Real Estate Group

The Kenna Real Estate Group, Keller Williams DTC in Centennial, builds a full monthly cost sheet for every home a buyer wants, with the actual tax bill, HOA dues and an insurance quote on the address, so the number you sign for is the number you live with. Call or text 303-955-4220. A live person answers. Not a robot, not a phone tree. Or search every home for sale in Colorado by price and send us the ones that fit your number.