Current Denver Commission Rates -- 5%?

Question

Hello! We're planning on putting our Denver 2bed/2bath condo on the market soon. We're currently discussing it with an agent in Denver. She's asking for 3.2% for her commission and 2.8% on the buyer's side. While 6% total has been standard over the decades, I was under the impression that 2.5% each was more common now. What's the trend for Denver, Colorado?

Also, If the agent represents BOTH the buyer and seller, is it reasonable to ask that the total commission be capped at 4%. If so, how can I word that request?

Another question -- if the agent is saying she will have it staged and professionally cleaned, can I expect to be billed separately for that, or is it common to wrap that into the commission (the 3.2% she's asking)? (I realize that question needs to be directed at her -- but just curious if there was a norm in Denver.)

Finally, any experienced agents on BiggerPockets interested in listing it? If so, would you do it for 2.5%? The market value is around $200,000. Though I imagine it could go for as low as $190K-$195K. New flooring was just put in the unit. It's in Denver proper -- but about a block or two from Aurora. Recent comps are in the $200K range. There are 3 others (in the same complex) currently on the market between $195K-$225K.

Thank you!

James Carlson · Answer

@Neil Hohmann

As @Matt M. said, there is no standard. Colorado law doesn't allow a set commission. That said, you might find agents willing to do it for less. The market seems to say that sellers in Denver on average are paying 2.5-2.8% to each side.

But like @Joel Owens said, if the agent seems to know what they're doing, then don't get too hung up on it. The ability to price a condo right the first time, market it well and communicate its value to buyers will likely save you more money in the end.

I think it's fine to ask your agent what they are bringing to the table to justify a commission that is higher than some others. The market has shifted a bit, so it's not the crazy seller's market it was a few years ago. Does that justify the extra? Maybe, if it's going to be a tough sell.

Good luck!

Neil Hohmann · Answer

Thanks, Matt. I appreciate your thoughts.

Matt M. · Answer

There is no standard, and everything is negotiable. I'd ask the agent directly about staging, etc. Commissions seemed to drop starting with banks during the REO days. The seller's market allowed tech companies to offer flat fees since homes went UC in a weekend. However as the market continues to shift, the value of a good agent is increasing because you can't get away with just listing a home anymore.

Neil Hohmann · Answer

Boom...great response! Thanks, Joel.

Joel Owens · Answer

There is no standard commission. Most buyers agents are new to the space with residential properties and have larger splits with brokerages on their first deals. So they do not make that much to begin with.

What are the other 3 on the market paying in commissions and splits? In some MLS's your listing broker could find that data.

Sounds like with 3 other properties in the same complex for sales you have some competition so might really have to work a lot to sell the property over and before the others do.

190,000 X 5% = 9,500   190,000 X 6% = 11,400

Talking a potential difference of 1,900 bucks

Sometimes buyers are stepping over dollars to try and save pennies. I would likely focus not on who will do it for less but who can likely get you the best price when selling with the fastest results.