Buyers' Slice Realty

Depends on with who! Here in Colorado, under CP-13, brokers can share, split, or rebate (as I like to say) their commission with the buyer, but just not with a disinterested third party. Of course, brokers also can and do split fees with other brokers, most often in the form of a referral fee.

Some home buyers ask me how much real estate commissions are in Colorado. And while I don’t have access to the specific averages, I can tell you that the 6% commission is still the standard starting point here. In Denver and Northern Colorado (including Boulder, Fort Collins, Broomfield, Golden, and Highlands Ranch), the listing agent typically retains 3.2% of that 6%, while offering those representing buyers (like me) 2.8%. Note: it’s that 2.8% that I use to rebate commission dollars back to my buyers. Interestingly, in the Colorado Springs area, buyer brokers typically get 3% on properties, but in both areas sometimes only 2.5% is offered on certain real estate. So while every deal is different, if you are looking for a home in the Denver-Boulder market, you can pretty much count on your broker making 2.8%.

Commerce Department reports that new housing starts in September were up 34.8% from last September! …..a sign that confidence in the housing market is increasing…if not strong…..consistent with most anecdotal evidence among Colorado real estate markets. New construction in the Denver area can present great opportunities for commission rebates….as long as you bring someone like me in early in the process. Every home builder is different in terms of their expectations and procedures, but don’t hesitate to ask me about how buyer rebates might work in a new construction scenario.

Closed a smaller deal in Denver yesterday, where my real estate commission rebate was only around $2800, BUT his cash at closing number on his FHA loan was only around $5500….when it would have been $8375 without my buyer rebate!

Existing home sales in August 2012 reported rose 7.8% in August….the strongest month since May of 2010.

Most lenders, presumably following some federal regulation, will limit the amount that you can receive back (via a commission rebate or buyer rebate) to an amount not to exceed your closing costs and pre-paids. This generally is not a problem for most home buyers who typically get back 1.4% of the purchase price from me…when closing costs are typically around 2% of the price of the home, BUT it does happen. Yes, it is a “good” problem to have…..meaning all of your closing costs would have presumably been paid for, but some could fairly perceive that some money was left on the table. If you are concerned about this, our best advice is (and has always been) to work with your lender early and often to verfiy any options!!!!!!!

Census Bureau reporting that new homes sales in July jumped 26% from same time period last year. That’s huge…and consistent with the increase in inquires that I have gotten about new construction around the Denver area the last couple months…in fact, just got my first call from someone looking for new construction in Arvada (or Golden).

This summer Smart Money magazine did an article on the matter of real estate agent reviews. Interestingly, no organization or website, has really emerged as the “go to” spot for rating real estate brokers and agents. However, on the few sites where REALTORS® are rated, they tend to get higher grades on industry-run sites versus outside sides like Yelp and Angie’s List.

Metrolist (the largest real estate MLS in Colorado) reported a sharp drop in housing inventory in Broomfield this summer versus last, with 414 homes listed for sale in June 2011 compared to 237 homes in June of 2012. That is behind the to a 7.5 percent increase in the median price of a home over that time period. Another sign that the bottom of the Colorado real estate market may be in the rear view mirror.

I recently had a REALTOR® on the “other side of the table” tell me that I can’t rebate half of my commission back to my buyer…saying it’s illegal (and that they are limited to $25 gifts going back to the buyer!)     Yikes.   Not only was I able to point her the to US Department of Justice’s extensive website on the matter, but here in Colorado, the Real Estate Commission clearly allows rebating (as validated in their Position Statement #12).