Adam: Affordability is the biggest challenge buyers are facing right now in 2026. But here's what most people are getting wrong. It's not that buying a house is impossible. It's that most buyers are approaching it the wrong way. Because the buyers who are winning right now aren't waiting for the market to change, they're changing their strategy. So today, on a brand new episode of the Pursuit of Progress podcast, we're breaking down what's actually working for buyers right now here in the Denver market in 2026. Three things specifically. how buyers are lowering their monthly payments, the hidden opportunities that most people are still missing, and what's actually working right now and what's not. Let's get into all of this on a brand new episode along with my co-host, Benjamin Adams. What's up, bro?

Benjamin Adams: My brother, another week, another episode.

Adam: Good. Yeah, man. Good to be back. Good to be back. I'm excited for this one. And for everybody that's listening, we're actually recording this right before another one of our live Denver home buyer master classes. So if you guys aren't in the loop on that, make sure you guys hop onto the next one. They're free. Just go to denverwebinar.com.

Benjamin Adams: That's right. Yeah, and we have some great information on that webinar later tonight. And we have some great information this podcast today. ⁓ We're talking about affordability. Now it's going to be specific here to Denver, but these are strategies that buyers in of these markets where affordability is an issue. ⁓ These strategies that buyers are using. So even if you're not in Denver, maybe you're listening in another big market and affordability is a concern. These options can still apply to you.

Adam: Yeah. Definitely. Let's just jump into it. that's kind of the first point that you'd like to bring up.

Benjamin Adams: Yeah, when I think of affordability, I think of three different types of affordability concerns right now in this United States housing market. And especially they're going to be a little bit more pronounced in some of these cities like Denver that are a little bit more costly. And the first affordability concern, number one, is monthly payments. So how are buyers lowering their monthly payments? Most buyers think their only option is to accept today's interest rate, but that's not necessarily true. The smartest buyers right now are negotiating their payment. Now, how are they doing that? Well, there's three main strategies negotiate the payment and the rate, which ultimately is then going to reduce the payment. The first option seller paid rate buy down. So instead of lowering the price, buyers are negotiating for to buy down their interest rate. One of these, you know, this is a scenario that comes up. just over and over again. And buyers a lot of times, especially first time home buyers, they don't always understand this. So say for example, a home is $500,000 and is gonna be bringing, let's say $50,000 ⁓ in a down payment. So are they gonna be better off reducing the sales price because it a buyer's market. So they know this, they find a home, it's been on the market for...

Adam: Mm-hmm.

Benjamin Adams: several weeks and they want to use the leverage that they have. And so they're thinking, am I better off asking for a $10,000 reduction in the sales price or am I better off asking for a $10,000 concession? Now, most buyers would probably say a $10,000 reduction in the sales price. ⁓ that's great. But if your goal is to either keep your out of pocket as low as you can or ⁓

Adam: Mm-hmm.

Benjamin Adams: use that $10,000 to buy the interest rate down, you're really gonna wanna consider the concession option. The reason the first option, the reduction in the sales price, it doesn't really move the needle that much is because your down payment is gonna be percentage based off of the sales price. So if the sales price goes from 540, or I'm sorry, 500 down to 490, $10,000 reduction, well, if you're putting... let's just say 20 % down. if you're putting 20 % down on 500,000 versus 490, it's very minimal. And because the loan is amortized over 30 years, the payment change and the payment difference is also going to be very minimal. But if you keep that sales price the same 500,000 and then you ask for a seller paid concession and then you use that to buy down the interest rate, well, all of a sudden you can have a meaningful ⁓ impact on what your rate is, which is ultimately going to impact your payment. that's

Adam: Let push back on that for a second. So one reason this might not make sense for somebody is if they were planning on only holding onto the home, which is say for five years or less, maybe it's of like a short-term thing. want to, maybe it's the first time home buyer, they realize that in a couple of years, maybe they're going to be wanting to have a family and they're going to need a bigger home in the not so distant future, but they still want to buy today. is part of the reason why that doesn't make sense for everybody is because $10,000 if used as a buy down for the rate, if they do sell in five years, they're not going to necessarily basically take advantage of that full $10,000 because of certain circumstances. guess ⁓ I said years, really, I guess it would be like three, right? If it was a three to one buy down, that would be an example of if it's within that three year period.

Benjamin Adams: Mm-hmm. Yeah, well, that's a good question. I think what you're asking is, is someone better off if they end up selling the home or for whatever reason, they pay off the mortgage, et cetera, et cetera, in a short time, they get relocated with their job. What is that going to look like from a cost to benefit perspective and break? And so, so I think that's where you're going. And that's a great question because there's several different types of buy downs that you can do. You can do a permanent buy down, which is where you buy the interest rate down on a

Adam: Mm-hmm.

Benjamin Adams: permanent basis, you use that $10,000 to permanently buy down the interest rate. Now, when you do that, that is considered a cost. And so that's a one-time cost upfront to obtain a lower permanent interest rate. again, if that loan amount is going to be four to $500,000 range, a $10,000 cost, it buy down the interest rate three eighths of a point. So if the market rate right now is six and a half percent, you might be able to get around like a 6.125%. Now, some of that depends on credit, type, et cetera, et But another great option to your point is the temporary buy down. What I love about the temporary buy down is it's considered a subsidy, not a cost. And so that's a really, really big difference. And so that $10,000, let's say that it was used for a two, one buy down. And what that means is that if the note rate is at six and a half, the first year on a two one buy down, the buyer would get a note rate, or I'm sorry, the note rate would be six and a half. The first year would be four and a half for the first 12 months, then five and a half for the next 12 months. And then it would mature to the six and a half, which is what the note rate is. But to your question, well, what happens? What if they move or they pay the loan off or they get relocated and they have to, you know, leave the property or sell the property. What's great about the temporary buy-down option is that since it's a subsidy, those funds are actually placed in the buyer's escrow account. So it's their money right from day one. And then they get the benefit of having the lower payment, the lower cashflow at a full two points lower the first 12 months, point lower the next 12 months before it fully matures. so yeah, just a really, really powerful impactful strategy on how to really impact that monthly payment and affordability. Ultimately, and this is the kind of market you want to consider that in. There's a lot of interest rate volatility rates have kind of increased back up right now with all of the Iran news. We were below six about a month ago. Now all of a sudden we're mid to high sixes depending on the day. And it's likely that interest rates could go back down at some point. But for right now, if you get that temporary buy down, It's a way to hedge against interest rate risk, where if interest rates do go down and you then want to refi, well, you don't have to feel bad about refinancing in the same way that you would on a permanent buy down, because once pay that $10,000 cost on a permanent buy down, that money's gone. But on a temporary buy down, it's placed in that escrow account, and then you get that money back if you do refinance within that first 24 month window on a two one buy.

Adam: Mm-hmm. I didn't know that that's really helpful. Guys, just if have any more in depth, maybe more personal questions on any of this stuff before we move on, just wanted to give a quick plug. Definitely shoot Ben a direct message on social or check him out on YouTube. If you guys just look for American Money 101, that's his handle. Check him out there, but he could go in a lot more specifics with your unique situations there. So don't be a stranger. Make sure you reach out to him.

Benjamin Adams: Oh, I appreciate that. The second point that I wanted to bring up, and I'm always hesitant to bring this up because this is a competition of mine. But the reason I did is because there can be some great deals and some great values right now for folks that are looking at new construction sellers or excuse me, builders right now are just offering some incredible incentives to move some of their inventory. And so I've seen builders doing the same thing, buying the rate down on behalf of the buyer. to really, really low levels, offering very low interest rates, paying for closing costs. And so if you're someone that is considering new construction, make sure that you're having those conversations your builder or your sales representative, because not just in this Denver market, in lot of different markets, builders are offering some really incredible incentives because they know that affordability is an issue and they're trying to move their inventory and they're trying to put these deals together in a way that are keep their existing homeowners people that have bought the last couple years in these communities happy. They don't want values dropping, but they also wanna make sure that the needs and the concerns of current buyers, current prospective buyers are being met. And so that's why they're offering of these incentives. I know that you've had some buyers that have considered new construction over the past six to 12 months. Are you seeing that on your end?

Adam: Yeah, a little bit. The only maybe a little side note I'd share with everybody that is considering new construction is oftentimes these builders are working off a 12 month, you know, calendar year accrual basis when it comes to just their expenses, their profit, all that good stuff. So I think Lenar is one that I think is a little different. think they actually end their year, their in their calendar year in like February or something a little bit different. But for most of the big builders out there, The end of the year is really big for them. They really want to try and unload as much inventory as they can so their numbers are as strong as possible for their investors. So oftentimes if you have some a little bit of flexibility with your timeline, trying to even come in at the end of the year where you might be able to find a home that's maybe sitting that they just really want to move and you might be able to get even better of a deal on that one.

Benjamin Adams: great. Yeah, this market here is always changing and that's why so important to stay in touch with what's happening and really you want be familiar with what's going on in your market. And then the third thing that I want to chat on, we talked about payment affordability. We talked about the pros of new construction. And then the third that I wanted to talk about was down payment affordability. A lot of times when buyers talk about affordability, there's monthly payment. monthly payments too high or they can only afford a certain payment range. That's one type of affordability. And then the other type of affordability is down payment. I shared a post a couple of days ago, sharing how many years it would take for a buyer to save 10 % down based off of each state's average sales price for 2025. And a lot of states

Adam: And that's 10 % down, not 20%, yeah.

Benjamin Adams: That's 10 % down, not 20 % down. And a lot of, a lot of States, was over 10 years to save for a 10 % down payment. And so most people don't realize this, but there are minimum down payment programs. There's reduced down payment programs, and there's also down payment assistance programs available. Some of those programs are going to be available to first time home buyers. are going to be available to every buyer. There are going to be certain requirements and guidelines that apply here in Colorado. The largest non-for-profit housing agency is called Chaffa, the Colorado Housing and Finance Authority. And what they do is they partner with local lenders to help qualify first-time home buyers, first-generation buyers, and then just regular buyers, people that have already owned a home with down payment assistance. a strategy, so you can get a silent second mortgage through Chaffa for down payment assistance of up to $25,000. They also have grant programs available. one that I love, this a strategy that I, ⁓ every single month doing this, where if you have a buyer and they qualify for down assistance loan, and then you can get the seller to pay for their closing costs, there are a lot of scenarios where buyers can still get into a home with only $1,000 out of pocket. That's happening right now.

Adam: Wow, that's awesome.

Benjamin Adams: Yeah. And so whether it's monthly payment, whether it's saving for a down payment, a lot of times there are ways to resolve some of these affordability issues.

Adam: And it's not, you know, that accurate to assume for everybody out there listening, that's just really, this is really hitting close to home for them about the down payment specifically. I don't know the exact number. I'm sorry to put you on the spot if you don't know either, but I think the average percentage down for the past year was not 20%. I think it was like 11 or 12 % or something like that. Quite a bit lower than the 20 % that a lot of people just assume is what they need.

Benjamin Adams: Yeah, the 20 % is what's thrown around in the industry a lot. You see that online, you know, put 20 % down. I know Dave Ramsey is a big proponent of that. And if you have the means, the resources to do that, maybe you're selling an existing home and has a boatload of equity. That may not be a bad idea, but especially if you're first time home buyers though, here's the reality. If you're a first time home buyer, unless you are getting significant financial help from family, parents, someone else, ⁓ know, the reality, or you have just a phenomenal job or you've been saving for years and years. The is, is more than likely you're not going to be able to put 20 % down. And the down payment on a conventional loan is 5 % chaffa, or I'm sorry, FHA is three and a half percent. And then there's reduced down payment programs that are income restricted. There's one with called home and home possible at 3%. And there's some of the down payment assistance programs that I just referenced where you can literally get into a home with as little as a thousand dollars out of pocket. That is happening right now, especially here in this Denver market.

Adam: It's very inspiring for, I think, a lot of people to hear that. Well, it's kind of shift gears. I'd like to spend a few minutes kind of spearheading this next point, which is just talking about a lot of the hidden opportunities that a of buyers are still missing today. lot of buyers right now are really focused on what's hard, know, the higher rates, higher prices, ⁓ of these affordability challenges that we're talking about. But I think also a lot of these people are missing where the real opportunities actually are. And right now in Denver, we're definitely seeing something shift. You homes are sitting longer. We're sitting at, you know, 40, 50, 60 days or longer in some scenarios. You price reductions are happening just because it is such a buyer friendly market at the moment. Buyers have a lot of leverage and sellers are definitely having to be a little bit more flexible. So then in recent years, just because of that pool of buyers being so small. So a lot of picky buyers out there right now. And because of all of that, that creates a lot of opportunity for buyers, but only for the ones that are prepared. So the reality that I kind of want to just kind of bring home here is that You don't necessarily find great deals, you recognize them. And the buyers that are winning right now are the ones that are really understanding and knowing their numbers, really having a good understanding of value, and are basically just in a position where they're ready to act extremely quickly when that opportunity does present itself. that big opportunity right now is that homes sometimes maybe need a little bit of light upgrades. It's so important right now for homes that are listed to be.

Benjamin Adams: Yeah.

Adam: absolutely pristine and perfect just because of, again, the buyers having so much to not only have leverage, but also be picky. A lot of inventory out there and very few active in the market. So for listings, out there that's trying to sell a home, it's so important right now just to have your home looking as good as it possibly can. And I'm not talking about, you know, full remodels, just a lot of little cosmetic improvements. So for you guys out there that are listening that are buyers or aspiring buyers this year, finding these homes out there that are really identifying themselves to you as this more cosmetic type upgrades. Those ones that are sitting longer, often oftentimes also have more room to negotiate because the sellers are starting to freak out a bit. just really understanding that there's opportunity in this market, but it doesn't look like it did, you know, five, six years ago, back in 2019, 2020, and even the beginning of 2021. It's a little bit quieter, it's a little bit more subtle and a little bit easier to miss if you don't know what you're looking for.

Benjamin Adams: Yeah, and one thing that I think we're all realizing, of the news has talked about how much more inventory there is right now than past years, how many more sellers there are than buyers. I shared a statistic last week that there's currently 630,000 more sellers in the United States than buyers. That's a pretty alarming number. But kind of to the point that you just referenced, if you have a property that is priced aggressively, it has curb appeal, or if it's priced within a certain price range, in this Denver market, you know, kind of four to 600,000, there are only so many homes in that price range. you are gonna have to be prepared, even if you are a buyer, that you're gonna be, there's only so many homes in that price range. So there's gonna be, that's gonna attract more buyers. And so you're gonna have to come and be ready, be prepared ⁓ not hesitate because when you hesitate, that's when these deals go under contract.

Adam: Yeah, this past weekend, this past Friday, I'm recording this today on a Tuesday. So about four or five days ago, I was actually out looking at some homes for some clients in the Aurora area. We've been looking for the last month or so at different options. And some of that have been a little bit, again, needing cosmetic upgrades has not presented the way they should. And those are still even several weeks later listed on the market. They haven't sold yet. We found one that we were really interested in. I went and previewed it for them, had a lot of what they were looking for. We talked about it briefly and said, yeah, well, you know, based on this market, you know, we probably will be fine. We'll just, you know, give it over the weekend. And sure enough, literally after just a couple of days on the market, it's already under contract. So we're not just saying this. It's definitely true. And just another reason how important it is to have all of this done ahead of time. So you're ready and capable to take advantage of the opportunities that are hidden sometimes, but when they do present themselves. The only way you're gonna really benefit from this is if you're ready to act at that point.

Benjamin Adams: That's right. So what's working right now in Denver and what's not. really have a conversation and move the conversation to what's working. What's working, prepared buyers, buyers who been pre-approved, buyers who understand their numbers and who can move quickly when the right opportunities show up. This is why getting pre-approved is so important. A lot of buyers, when they're going through this for the first time, I think they look at getting pre-approved as Kind of just going down a checklist and you know, I filled out the application, I have my credit pulled, I've sent in my financials, I'm pre-approved, great. But what they don't understand is what's really most important about a pre-approval is you want to know what your options are. So you can put that plan together, put that strategy together and really figure out what is gonna work. Are you gonna consider down payment assistance or a temporary buy down? And then you can have those conversations with your real estate and your mortgage professional. And when everyone is on the same page, That is how you win. way buyers are winning right now ⁓ buyers that are flexible. Maybe it's location, homestyle, timeline. The more flexible you can be, the more opportunity you have. When you're inflexible, really of it as just putting yourself in a box. If you flexible on timeline, if you have to buy something in the next 30 days, you're only gonna have so many options. If you're not flexible on location, you may be waiting until if you're looking for a home on a specific block you could be waiting months or years.

Adam: Imagine just walking into a used car sales lot and you have to buy a car that day. You you're unprepared, you just show up and you have to buy the car that day and you end up driving out of there with a yellow PT Cruiser and you hate your life and you're ready to sell that thing a year later.

Benjamin Adams: The PT Cruiser, that's right. I always use the analogy of when I bought my first home in Phoenix, Arizona. At the time, we had just had my son, he was six months old, and it was a very affordable home. It was a newer home, it was a big house, and so it fit all of our needs, but it wasn't in a great area. And that's why it was priced so appropriately. And I knew that, and I knew at that stage of my life,

Adam: with wood paneling on the side.

Benjamin Adams: that finding something that was affordable was number one, even if it wasn't in the very best location. But it allowed me to get in the game. And so right now that's what's most important for a lot of buyers. you're looking for your dream home or that vacation or that second home and you want it to be in a specific area, that's a different conversation. But for someone that is looking to get in the game, what's most important is just getting in the game.

Adam: Definitely. And I'd add to that, you there's, again, you're talking about location, the home style timeline. The other one in there, maybe that throw in would be a condition. So, you know, instead of that brand new turnkey home, maybe it's, you're gonna have to sacrifice a little bit. You know, you're gonna have to buy a home that maybe needs a little bit of upgrades. Maybe it's got some old paint. Maybe it's got old appliances. Things though that are very doable in the future when that budget maybe improves a little bit, you can have extra money to, you know, update a few things.

Benjamin Adams: Mm-mm. Yeah, yeah, that's a great point, Adam. Thank you for sharing that. what's working. Let's talk about what's not working. So not working? Waiting for the perfect time. When you for the perfect time, whether it's interest rate, you're waiting for interest rates to come down, for home values to come down, there's a good chance you're just gonna continue to wait. There's always gonna a reason not to buy. So if you're waiting for perfect conditions, there's always gonna be a reason not to buy. Um, something else that's not working is only looking at price. I see this so often. This is something that always cracks me up. have, you know, seller, buyer, they come together, uh, buyer rights and offer seller counters and they, and they get so close to a deal. And then we're, know, we're, within a thousand or $2,000 and then everybody just walks away. Can't figure it out. And if you're talking like $5,000 on a $850,000 home. Dude, that's so insignificant. It impacts, there's no impact on the payment hardly. It's just, and so understanding the big picture. As a matter of fact, I think you had, I remember you telling me that you kind of had a scenario similar to that, or you had some folks that you were working with over the last year that were, they kind of got to that number within like a thousand or 2000, and then they.

Adam: Unreal. Absolutely.

Benjamin Adams: both parties decided to walk away like two or three times, right?

Adam: Yeah, man, it's crazy. You know, that's an example of emotion. You know, we don't think level-headed. We let, you know, emotion, we let our ego get involved. And then there's all these other factors at play when if you really dumbed it down and simplified things again, it would be pretty obvious what the right move was, but that's human nature for us.

Benjamin Adams: Yeah, that's right. Well, that's all that I had to share on that. So I'll let you take it from here.

Adam: Yeah, well, ⁓ Yeah, buddy. think just last thing I'd like to say is just two things, actually. First, you know, another call to action here for you guys. Even if you're not considering buying a home this year, maybe even not for, you know, a couple of years, there's still no harm whatsoever in connecting with somebody. I would say at that phase, somebody like Ben, somebody that's on the lending side is a huge advantage, even a couple of years ahead of time. Just, maybe you're not, you know, identifying homes that you're potentially going to be, you know, purchasing. not at that stage yet. But there are several other things that the earlier you know, the better. You know, we go through a lot of this on our home buyer webinars. Again, if you guys want to join the next one, go to denverwebinar.com. But just as one example of this, understanding your credit, understanding that where you actually are today, if there's room for improvement, that's very achievable and easy to accomplish if you understand how to do so, and you need time in order to have that in the right place when that time comes. So. Just little things like that are so important to do well in advance of that time to actually go out and start looking at homes. A of people just don't really think about any of that stuff. They just one day decide they wanna move or they wanna buy a home and then they wanna buy it next month and they don't have the ability to really put themselves in the best position possible to get the best rate on their interest, rate of interest on their loan, to get the best neighborhood that they're really looking for, that fits what they're looking for. All these things can all be. ⁓

Benjamin Adams: Yeah.

Adam: much, much, much more improved just by preparation and having time on your on your side. So take the effort today just to put yourself in that position if you can.

Benjamin Adams: And you know what, Adam, when you do it in the way that you were just describing, you know what else? You can enjoy it a lot more too. You can actually enjoy the process.

Adam: Yeah, it's not stressful. Absolutely. Yeah, it's not stressful. with all that said, you guys affordability, it's not just about price. As you can tell, it's about strategy. The buyers who are succeeding right now aren't the ones waiting for the market to change. They're the ones learning how to navigate it. So if you guys want to dive into this at all, feel free to reach out to either Ben or myself. Find Ben on Instagram, Facebook, ⁓ American Money 101. And as for myself, find me as Adam Lang or AdamSellsDenver.com. We also offer 15 and also 30 minute strategy sessions where we can do a one-on-one. really help you kind of understand whatever's a sticking point for you at this point. And you guys want to join that next webinar, make sure you guys go to denverwebinar.com. We'd hope to see you guys on the next one. And with all that being said, my name is Adam, signing off for Ben on the Pursuit of Progress podcast.

Benjamin Adams: Love you guys, we'll see you next week.