Company in Denver hopes to help home buyers purchase houses for as little as $5

What if you could buy a house in Colorado for just $5? A new company is working to make that a reality, starting with a home in Denver.

Earlier this year, Jason Graf and Sam Cogan launched their new startup, FulHouse Inc. The company operates a sweepstakes model in which, instead of one buyer paying the full cost of a home, the price is split among thousands of entrants, each paying a few dollars to enter. At the end of the sweepstakes period, they hope the home will be paid in full, and one lucky winner will receive it at a fraction of the cost.

This fall, Graf put his own two-bedroom Denver townhome up for sale for the company's first sweepstakes.

"We believe so much in the idea that we really wanted to put our money where our mouth is," Graf said.

His hope for this company is to make purchasing a home more accessible, he explained. The company's launch also comes at a time when a new study from personal finance website Bankrate found that more than 75% of homes across the U.S. are unaffordable for the average household.

"A lot of those, those like dream giveaways, those are very fancy mansions, right? And it's a marketing play for those reality TV shows. This is something different. This is truly trying to work with our community to give another option," Graf said.

Since their first listing opened last month, Fulhouse has received more than $15,000 in entries. Graf says he is hoping to list more properties soon.

"I've also had real estate agents already reach out and say, 'Hey, I got 20 homes I need to sell. Can I put my home on your platform?'" Graf said.

But some realtors are cautious about a new model like this, given the many details to consider. Andrew Abrams is on the market trends committee for the Denver Metro Association of Realtors, and he said he believes that sometimes selling a house the more traditional way can help sellers better plan around moving dates and other costs.

"As far as my sellers go, I don't think [they'd use this]. I think they have their expectations for the way to sell a house. It's a little more traditional, and they would stick to that. You know, for $5, would one of my buyers say, 'Sure, I'll take a chance?' But to me, it's kind of the same thing as doing the lottery," Abrams said.

As with any home purchase, Abrams explained, it comes with risks and a lot of fine print.

"There's never a reason to say, 'It's different, therefore it has to be bad.' But having said that, doing the full due diligence, doing all the fine reading, all those details are so important, and most people don't want to do that, which is why we have a traditional model, which is basically supply and demand," Abrams said.

The sweepstakes for Fulhouse's first property is set to close at the end of March, and if the entries reach the selling point, Graf says it will be raffled off. Graf also said that if the listed home doesn't receive enough entries to reach the sale price, potential entrants can request a refund, donate their money, or double their entries in the future at no additional cost. Those who want to participate can also write Fulhouse a postcard for a free entry.

"Saying that your house is, you can win a house for $5 sounds scammy, right? But that's why we're really trying to get the word out that we're just regular people, and we're here to make a difference," Graf said.