Colorado Real Estate Commissions: What You Can Expect in 2024
Understanding real estate commissions is key when buying or selling a home in Colorado, as they significantly impact your overall costs and negotiation strategies. With new rules introduced in 2024, the way these commissions are communicated has become clearer, giving both buyers and sellers more transparency and control over fees.
Whether you’re entering the housing market for the first time or have prior experience, this guide will provide insights into Colorado real estate commissions and what you can expect from the market in 2024.
Current state of the Colorado housing market
Before diving into the specifics of real estate commissions, it’s important to review the broader market trends in Colorado. These market factors can influence both buying and selling decisions.
Median Home Sale Price
$594,200
Housing Supply
35,760 (+22.3% YoY)
Homes Sold Above List Price
20.5% (-5.9 pts YoY)
Understanding real estate commissions in Colorado
What are real estate commissions?
Real estate commissions refer to the payments made to agents for facilitating a home transaction. These fees, typically expressed as a percentage of the property’s sale price, are only paid upon closing. They cover the professional services provided by the agent throughout the homebuying or selling process.
Who pays the commission?
Historically, sellers have paid for both their agent’s commission and the buyer’s agent’s fees using the proceeds from the sale. Starting August 17, 2024, new rules will require buyers to agree to their agent’s commission rate in writing before touring.
While buyers can still negotiate for the seller to cover these costs, this update allows for more transparent discussions. It gives both parties greater control over how much of the buyer’s agent commission, if any, the seller will cover during negotiations.
Average real estate commission rates in Colorado
Real estate commissions in Colorado can vary depending on several factors, including the property’s location, current market conditions, and the agent’s service offerings. These rates are negotiable, allowing buyers and sellers to work out a fee structure that suits their budget.
Here’s an example of typical real estate commissions based on median home prices in some of Colorado’s largest cities:
City
Median Home Sale Price
1.5% Real Estate Commission
3% Real Estate Commission
5% Real Estate Commission
Denver
$585,000
$8,775
$17,550
$29,250
Colorado Springs
$464,000
$6,960
$13,920
$23,200
Aurora
$475,000
$7,125
$14,250
$23,750
At Redfin, we strive to offer exceptional value. Sellers can take advantage of our listing fees, which start at just 1%.* For buyers, our fees vary by location but are designed to be competitive, helping your offer stand out and increasing your chances of success in the homebuying process.
Can you negotiate real estate commissions in Colorado?
Yes! Real estate commissions in the U.S. are not set by federal law, so there’s room for negotiation. The final commission rate depends on several factors, including the complexity of the transaction, the services needed, and your relationship with the agent.
When negotiating commissions, it’s important to consider:
The level of service your agent offers
The marketing plan for the property
The agent’s local expertise
Sellers may have an advantage in negotiating lower rates if their home is likely to sell quickly or is in a high-demand area.
Tips for a Successful Negotiation
Compare different agents and their commission structures before making a final decision.
Discuss the possibility of performance-based commissions, such as offering a higher rate for a quicker sale or a higher-than-expected selling price.
If your property is located in a sought-after neighborhood, use that as leverage to negotiate a lower commission.
Colorado real estate commission FAQs
What are the changes to real estate commission? There have been two notable changes: First, buyers must now agree to their agent’s commission rate in writing before beginning home tours. Second, in some markets, agent commission details are no longer visible on MLS listings. Learn more about the real estate commission changes here.
How do the changes impact buyers in Colorado? Buyers are now required to sign a contract with their agent outlining the commission rate before viewing homes. However, buyers can still negotiate with sellers to cover part of their agent’s fees during the offer process.
How do the changes impact sellers in Colorado? Sellers will continue to negotiate the buyer’s agent commission with their listing agent, if any. Any changes or requests regarding these terms will be handled through negotiations during the sale process.
How do you find a real estate agent in Colorado? If you’re looking to buy or sell a home in Colorado, Redfin can help. Contact a Redfin agent to get started today.
How can you avoid fees? Selling a home on your own, also known as For Sale By Owner (FSBO), allows you to skip paying commission fees. However, FSBO transactions require more effort and responsibility, including marketing your property, coordinating showings, and handling all paperwork.
*Listing fee subject to change, minimums apply. Any buyer’s agent fee the seller chooses to cover not included. Listing fee increased by 1% of sale price if buyer is unrepresented. Sell for a 1% listing fee only if you also buy with Redfin within 365 days of closing on your Redfin listing. We will charge a 1.5% listing fee, then send you a check for the 0.5% difference after you buy your next home with us. Learn more here.
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