What Every Home Buyer Should Know Before Purchasing Large Acreage:
Thinking about buying acreage or a home with a well in Colorado? Read this before you sign a contract.
When people dream about moving to Colorado, they imagine mountain views, horses, wide-open spaces, and beautiful custom homes on acreage.
What most buyers don’t think about is water.
Yet water is one of the most important—and misunderstood—parts of buying real estate in Colorado.
In fact, I’ve seen buyers unknowingly purchase properties that couldn’t legally water a horse, irrigate a lawn, or even maintain the landscaping they fell in love with during the showing.
Over my years as a Colorado Springs Realtor, I’ve spent countless hours speaking with well drillers, county planners, water engineers, the Colorado Division of Water Resources, and homeowners. Water law in Colorado can be incredibly complex, but understanding the basics can save you thousands of dollars—and possibly keep you from making a very expensive mistake.
Let’s simplify it.
Why Water Is Such a Big Deal in Colorado
Although Colorado is famous for snow-covered mountains, much of the state is actually considered a high-plains desert.
The average annual precipitation in Colorado is only about 17 inches, compared to the U.S. average of more than 32 inches.
Add Colorado’s high elevation, low humidity, and intense sunshine, and water evaporates much faster than it does in many other states.
If you’re relocating from Texas, Florida, or the Midwest, this may be completely different from what you’re used to.
That beautiful green lawn? It takes a lot more water to keep it alive here.
Water Is Becoming More Valuable Every Year
Colorado’s population continues to grow, but the amount of available water does not.
Communities throughout the Front Range are competing for limited water supplies.
New developments often spend millions of dollars securing water rights before they can even begin construction.
As water becomes more valuable, restrictions become more common.
This affects:
- Landscaping
- New home construction
- Irrigation
- Agricultural uses
- Well permits
- Future property values
For acreage buyers, understanding these issues is just as important as understanding the home’s condition.
This affects:
- Landscaping
- New home construction
- Irrigation
- Agricultural uses
- Well permits
- Future property values
For acreage buyers, understanding these issues is just as important as understanding the home’s condition.
Where Does Colorado’s Water Come From?
Most people assume Colorado has endless water because of the Rocky Mountains.
The reality is that 70–90% of Colorado’s water comes from snowmelt.
That water has to supply millions of residents while also flowing downstream to neighboring states under interstate water agreements.
Meanwhile, nearly 80% of Colorado’s water is used for agriculture.
Because most people live along the Front Range—but most of the water originates in the mountains—massive engineering projects move water hundreds of miles across the state.
As Colorado grows, managing this limited resource becomes even more important.
How Water Can Affect Your Home Purchase
Imagine moving into your dream home only to receive notice that water rates have quadrupled.
Or discovering you cannot legally water the horses you planned to own.
Unfortunately, situations like these happen more often than most buyers realize.
Before purchasing any property, especially acreage, you should investigate:
- Which water district serves the property?
- Is the property on a municipal water system or a private well?
- Are there current water restrictions?
- How deep is the recommended aquifer?
- Does the HOA have water conservation policies?
- Do I need a domestic or in-house well?
These questions can save you major headaches later.
Domestic Well vs. Household Well: What’s the Difference?
This is one of the biggest areas of confusion.
Domestic Well
A domestic well generally allows:
- Water inside the home
- Irrigation of a limited amount of landscaping
- Watering domestic animals such as horses, goats, chickens, and livestock (depending on permit language)
However, “Domestic” does not mean unlimited use.
Every permit is different.
For example, a domestic well may allow you to water your own horses but not board horses commercially or irrigate crops that you plan to sell.
Always verify the exact language on the well permit.
Household Well
A household-use-only well is much more restrictive.
Typically it allows:
- Water inside the home only
Generally it does not allow:
- Watering livestock
- Irrigation
- Lawns
- Landscaping
This surprises many buyers.
I’ve personally shown properties with beautiful landscaping that technically exceeded what the well permit allowed.
Without researching the permit, a buyer could unknowingly inherit a costly problem.
Understanding Aquifers
Think of an aquifer as a giant underground water source made up of water-bearing rock and soil.
Some aquifers produce abundant water.
Others produce very little.
One of the most important numbers to know is your well’s gallons per minute (GPM).
A healthy residential well might produce around 15 gallons per minute, although many homes function perfectly well with less.
If production is very low—perhaps only 2 or 3 gallons per minute—the home may require a cistern system.
What Is a Cistern?
A cistern is a large storage tank that slowly fills from the well and supplies the home when demand increases.
While these systems work well, they require additional maintenance and can affect your daily water usage.
This is something buyers should fully understand before purchasing a property.
Why Getting a Domestic Well Isn’t Always Easy
Many buyers assume they can simply purchase vacant land and drill a well.
Unfortunately, that’s not always possible.
In parts of El Paso County, especially on the northeast side near the Dawson Aquifer, obtaining a domestic well permit on smaller parcels under 35 acres has become much more difficult.
Some buyers may need:
- A Well Augmentation Plan
- Water engineering studies
- Legal assistance
- Court-approved water rights through a Determination of Water Right
These processes can be expensive and time-consuming.
I’ve worked with buyers who ultimately decided not to purchase land because obtaining adequate water simply wasn’t practical.
Don’t Assume the Existing Landscaping Is Legal
One of the biggest mistakes buyers make is assuming that if the current owner has a lush lawn, beautiful trees, or horses, the well permit automatically allows those uses.
That isn’t always true.
The current owner may simply be using more water than their permit allows.
Before buying acreage, verify what the permit actually authorizes—not just how the property is currently being used.
Questions Every Acreage Buyer Should Ask
Before purchasing land or a home with a well, ask:
✔ What type of well permit does this property have?
✔ Can I water horses?
✔ Can I irrigate landscaping?
✔ What is the well’s gallons-per-minute production?
✔ Which aquifer supplies this property?
✔ Is a cistern required?
✔ Are there current or future water restrictions?
✔ Are additional water rights required for my intended use?
A Real Example: Why Water Can Make or Break a Development Project
Recently, I worked with a buyer who was interested in purchasing approximately 120 acres in Black Forest with the goal of subdividing the property into 2.5-acre lots for a small residential development.
At first glance, the project seemed straightforward. However, like many land development projects in Colorado, everything came down to one question:
Where will the water come from?
Our first call was to the El Paso County Planning and Community Development Department to determine whether rezoning the property was even possible.
Their answer surprised us.
Before the county would seriously consider rezoning the property, they wanted to know how the future subdivision would obtain its water supply. In other words, the water plan needed to come before the rezoning application.
Next, we contacted the Colorado Division of Water Resources to discuss well options.
The most practical source of groundwater appeared to be the Dawson Aquifer, located approximately 400 to 500 feet below the surface. A residential well at that depth would cost roughly $20,000 to drill.
That sounded reasonable—until we learned there was a catch.
Because of the location and the intended subdivision, the project would likely require both a Water Augmentation Plan and a Water Replacement (Replenishment) Plan before domestic wells could be approved. Those additional requirements can significantly increase both the cost and complexity of development.
The next option was the Denver Aquifer.
Interestingly, wells into the Denver Aquifer generally did not require the same augmentation plan for this property. However, the aquifer was estimated to be more than 1,000 feet deep.
Drilling a well that deep was estimated to cost approximately $80,000 per lot.
That dramatically changed the economics of the project.
To make matters worse, several well-drilling companies explained that they either would not warranty pumps installed at that depth or offered limited warranties because the pumps must work much harder and often have a shorter lifespan.
When you multiply an $80,000 well by dozens of future home sites, development costs rise quickly, making the finished lots far less affordable and less attractive to future buyers.
This experience perfectly illustrates why water is often the single biggest hurdle when developing rural land in Colorado.
Many properties created after the late 1970s that are located outside established subdivisions don’t automatically have access to domestic well permits. Unless a developer has already secured an augmentation plan or another approved water source, obtaining water rights can become one of the most expensive and time-consuming parts of the entire project.
It’s one of the reasons I encourage anyone considering purchasing vacant land or development property to investigate water availability before falling in love with the property. A beautiful piece of land isn’t nearly as valuable if obtaining water proves prohibitively expensive.
Final Thoughts
Buying acreage in Colorado can be one of the best investments you’ll ever make—but only if you fully understand the property’s water rights.
Water laws in Colorado are unique, and every property is different.
The good news is that with the right research and guidance, you can avoid costly surprises and confidently purchase the property that fits your lifestyle.
If you’re thinking about buying land, a ranch, or a home with acreage in Colorado Springs, Monument, Black Forest, Falcon, Peyton, or the surrounding communities, I’d be happy to help you navigate the process and connect you with the right professionals before you buy.
A little research today can save you thousands of dollars tomorrow.
