What should I check when my buyer is buying a home with a well?

Most mountain homes outside town limits run on a private well. Buying a home with a well means checking three things a city buyer never thinks about: what the well permit legally allows, whether the water is safe, and whether the well makes enough water. In Colorado there's a fourth twist. A well permit is not the same thing as a water right. Here's how I walk agents through it so your buyer isn't surprised after closing.

The short answer

Look up the well permit with the Colorado Division of Water Resources (DWR). The permit says what the water can be used for. Many small mountain parcels have "household use only" permits, which cover water inside one home and nothing outside. Have the water tested by a lab during the inspection period. Ask about yield (how many gallons per minute the well produces) and storage. Make sure the change-of-owner filing with DWR gets done at closing. Water rights, like ditch shares or decreed rights, are a separate property right that moves by deed.

Step by step

1. Find the permit number. Ask the seller, check the disclosure, or search the DWR well permit tool by address or owner.
2. Read the permit itself. Not the listing. Match the permit number, use type and location to the parcel.
3. Know the permit types. In general terms:
   • Household use only: inside one home. No lawn watering, no livestock. Common on smaller parcels.
   • Domestic (often on 35+ acres): can serve more than one home, a small lawn and garden, and some animals.
   • Other permits exist for commercial, livestock or augmented uses. The permit conditions control.
4. Order a water test. Private wells aren't regulated by the state the way city water is. The owner is responsible for testing. State health guidance suggests regular tests for bacteria (coliform), nitrate/nitrite and a few basics, plus periodic tests for metals and other contaminants like arsenic and uranium. Use a certified lab.
5. Ask about yield and storage. Request any yield test, the storage tank size and well repair records. Some counties require a yield test for building permits in mountain areas. Low-yield wells often need a storage tank.
6. Check setbacks. The well should sit a required distance from the septic tank and other contamination sources. The inspector or county can confirm.
7. Handle the change of owner. Colorado law requires updating the well owner's name when the home sells. The closing company often handles the form at closing. Confirm it's in the file. See DWR well permitting.
8. Write it into the contract. Set the water test and well review inside your inspection deadline. See Colorado contract basics.

Well permit vs. water right

Colorado follows "first in time, first in right." Older rights get water first in a shortage. A right that goes unused for years can be presumed abandoned. In some areas, newer wells sit under an augmentation plan that replaces water the well takes. If a property's well depends on one, get the certificate or membership paperwork in the file. For anything beyond a normal house well, bring in a water attorney.

How to explain it to your client

Watch-outs

• The listing isn't the permit. "Great well" means nothing. Read the actual permit.
• Garden and horse plans. If the buyer wants a big garden or animals, a household-use-only permit won't allow it.
• Drought. Mountain wells can drop in dry years. Ask about the seller's history with low water.
• Lab limits. Public lab services change. Line up a certified private lab early.
• Don't promise water rights. A house well permit isn't a decreed water right. Don't describe it as one.
• Not legal advice. Water law is complicated. Send water-rights questions to a water attorney and permit questions to DWR.

Further reading

• What should you check when buying a Colorado home with a well? on coloradomountainhomefinder.com
• How do well permits and septic rules work on Colorado mountain land?
• How do water rights work when you buy mountain land in Colorado?
• Well and septic on Colorado mountain homes: what buyers check

This is training for real estate agents. It isn't legal, tax or lending advice. Check with your managing broker.

Frog tip: Ask every CHFA buyer "stay or go?" on the first call. A long stay often favors the second mortgage, and a short stay or likely refinance often favors the grant. Let the lender price both. Learn more →

Questions

How do I find a Colorado well permit?

Search the DWR well permit tool by address, permit number or owner name.

Can my buyer water a lawn from a household-use-only well?

No. That permit type covers water used inside one home.

Does the state test private well water?

No. The owner is responsible. Use a certified lab.

Is a well permit a water right?

No. A water right is a separate property right with its own records and priority date.

Does the well permit need to be updated at sale?

Yes. Colorado requires the owner name to be updated. Confirm the closing company has it handled.

Brian Lee Burke is the founder of PadLeaders, a Colorado real estate broker licensed since 2003, team leader of The Kenna Group at Keller Williams DTC (formerly Kenna Real Estate Group) and the author of Mastering Real Estate and The Real Estate Playbook. More about Brian.