What Does the NAR Settlement Mean for Home Buyers in Colorado?

The NAR settlement that took effect in August 2024 changed how buyer's agents get paid in real estate transactions. If you are buying a home in Colorado, here is what is different, what stayed the same, and what you actually need to think about.

The Biggest Change: You Now Sign a Buyer Agreement Upfront

Before the settlement, buyers could tour homes with an agent without signing any formal agreement, and the buyer's agent was paid by the seller through the MLS listing. That system changed.

Now, before a buyer's agent can show you homes, you must sign a buyer representation agreement. This agreement defines the agent's compensation and what they are obligated to do for you. It is a formal contract, not a casual arrangement.

Who Pays the Buyer's Agent Now?

It depends on what the seller offers and what you negotiate. Here are the common scenarios:

• The seller offers buyer's agent compensation as part of the deal. Your agent's fee is covered, and you pay nothing out of pocket for representation. This is still common in the Denver metro market.

• The seller offers less than your agent's agreed rate. You may need to pay the difference, or you can negotiate for the seller to cover it as part of your offer.

• The seller offers nothing. You either pay your agent directly or ask the seller to include compensation as a concession in your offer.

Does This Make Buying More Expensive?

Not necessarily. In practice, many sellers in Colorado still offer buyer's agent compensation because it attracts more buyers and more offers. The requirement to offer it through the MLS is gone, but the market incentive to offer it often remains.

Where things get more complicated is when a seller offers nothing and you need to either negotiate compensation into your offer or pay your agent directly. For buyers with limited cash reserves, this can create a real constraint. Knowing upfront what a seller is offering, if anything, is now more important than it used to be.

What Should You Look for in a Buyer Agreement?

Before signing, make sure you understand a few things:

• What compensation rate is the agent expecting, and is it negotiable?

• How long does the agreement last, and are you locked in with that agent for that entire period?

• What happens if the seller does not offer enough to cover the agreed rate?

• Can you terminate the agreement if things are not working out?

A fair buyer agreement protects both sides. If an agent is unwilling to discuss any of these points, that is useful information about how the relationship will go.

How LOGO Real Estate Works With Buyers

At LOGO Real Estate, the List One Get One model is built specifically around buyers who are also selling. If you sell your home with LOGO Real Estate at 1%, and then buy your next home through LOGO Real Estate, that 1% listing fee comes back to you at closing. You effectively paid nothing to sell your home.

If you have questions about how buyer representation works in today's market, what to expect in the home search process in Highlands Ranch or the Denver metro area, or what the LOGO model means for your specific situation, reach out.

Kevin Hays | LOGO Real Estate | 303-683-0008 | www.logorealestate.com