Did the NAR settlement change who pays the buyer's agent?

In about 99% of transactions, the seller still pays the buyer's agent, just like before the settlement.

I get this question constantly, because the media coverage around the settlement confused just about everyone. The lawyers who won that lawsuit pulled off an impressive trick on the whole country, and the headlines made it sound like buyers would suddenly be stuck with huge new bills.

Here's what I tell people: it works essentially the same way it always has. The seller pays commissions for both sides, and the buyer gets represented by a buyer's agent. The difference is that the commission is now written into the purchase contract instead of being advertised upfront. Since the rule changed a couple of years ago, not a single meaningful thing has shifted in how deals actually get paid. Almost every listing side still agrees to cover the buyer's agent, because that's what gets homes sold.

How did commissions work before the rule change?

Before the settlement, a typical Denver listing charged about 5.6% total, split 2.8% to each side.

The old conversation went like this. A seller would come to me and say, "Alex, I want you to sell my house. What's it going to cost?" I'd tell them 5.6%: we take 2.8% on the listing side, and we offer the buyer's agent 2.8% to represent the buyer.

Add title insurance and transfer costs on top, and I'd tell sellers to expect about 6% in total selling costs. On a million-dollar home, that's roughly $60,000 to have everybody taken care of, both agents, title, the works.

That structure was baked in before the offer ever arrived. The buyer's agent knew what they'd earn because it was posted with the listing. That's the part the settlement removed.

How does buyer agent commission work in Colorado now?

The buyer agent fee, typically 2.5% to 2.8%, now gets written directly into the purchase contract.

Today the seller conversation goes a little differently. I still charge 2.8% on the listing side, and we pay for all the marketing and advertising out of our own pocket. Then I ask the seller how much they want to offer a buyer's agent.

My honest advice: if you want the best outcome on your house, offer 2.5% to 2.8%. The buyer's side writes their fee into the offer, and the seller can respond however they want. Get a weak offer? Counter it and say you'll only pay 2%.

But here's the catch. If the seller offers less than what the buyer agreed to pay their agent, the buyer has to cover the gap. That can steer buyers away from your listing entirely, which costs sellers far more than the commission ever would.

What happens if a seller refuses to pay the buyer's agent?

On a $1 million purchase, a buyer facing a $25,000 to $28,000 agent bill will usually just walk away.

When you hire me as a buyer's agent, we sign an agreement that says I'll be paid 2.8% of the purchase price. The seller pays it in almost every case, but if the seller won't, the buyer is responsible. Does that mean you're forced to pay? No. It means you don't have to buy that home if you don't like the terms.

Say we write a million-dollar offer and the seller comes back refusing to pay a buyer's agent. I go to my buyer and ask, "Are you willing to pay me $25,000 to $28,000 to help you buy this house?" They're going to say no thanks. There are other options out there, so we walk away.

Smart sellers understand this. Offering the buyer's agent something keeps the largest pool of buyers competing for your home.

How do I structure buyer agent fees to protect my clients?

I write my 2.8% fee into the contract with a 2% floor, so small counters never touch my buyer's wallet.

The way I construct it is simpler than most, and it takes risk off my buyer's plate. I put my 2.8% fee in the contract with a floor of 2%.

If the seller counters at 2.5%, great. I just accept less. No negotiation with my buyer, no awkward conversation, nothing. If they come back at 2%, same thing. I accept 2% and we move on. Only if the seller offers below 2% would I ever ask my buyer to make up the difference, and in the Denver market that almost never happens.

The settlement changed the structure of commissions, not who pays them in 99% of scenarios. Honestly, it was set up this way before too. Sellers never had to pay a buyer's agent. It's just in their best interest to do it if they want top dollar for their house.