Because that arrangement became common, many people assumed it was required. It was not — and never was. It was simply the convention in most markets.

In August 2024, changes related to buyer representation and agent compensation took effect nationwide. Those changes have led to a lot of discussion — and, in some cases, confusion — about what changed, what did not, and what it means for buyers and sellers.

This post explains the basics. This post explains what has changed, what has not, and where some of the biggest misconceptions tend to show up. I also link to separate posts for buyers and sellers who want a more practical explanation of what these changes may mean in real life.

What Hasn’t Changed

One of the biggest misconceptions is that sellers were required to pay the buyer’s agent. They were not. That was never a law or universal rule. It was simply a common arrangement that became the norm in most markets.

Buyers can still choose to work with an agent, and sellers can still decide whether to compensate the agent representing the buyer. The main changes concern how compensation for the buyer’s agent is handled and disclosed.

What Has Changed

First, the MLS — the database agents use to find and share listings — no longer displays whether or how much the seller is offering to pay the buyer’s agent. For many years, that information was visible in the MLS. Now it is not.

Second, agents working with buyers are now required to have a written agreement with them before touring homes. Among other things, that agreement addresses how and how much the buyer’s agent will be compensated.

Misconceptions

One misconception is that sellers can no longer offer compensation to the buyer’s agent, and that buyers must always pay their agent out of pocket. Neither is true. Sellers can still offer to pay the buyer’s agent, but that offer is no longer displayed in the MLS. Now, compensation is addressed more directly: first in the agreement between the buyer and the buyer’s agent, and then, when needed, in negotiations with the seller.

More for Buyers and Sellers

This post explains the broad changes. If you are a buyer and want to understand what these changes may mean for you when hiring an agent, touring homes, writing offers, or negotiating costs, see my separate post for buyers. If you are a seller and want to understand how these changes may affect your pricing, marketing, negotiation strategy, and whether to offer compensation to the agent representing the buyer, see my separate post for sellers.

One of the reasons we encourage buyers to ask a few direct insurance questions up front is simple: insurance policies have exceptions, and it’s easy to assume something is covered when it isn’t.

A story

A good friend bought his first home a while back. He and his wife went on their honeymoon and came home to find their basement flooded. The water came in from the outside. The problem was that a downspout extension was missing, and there was a heavy rainstorm while they were gone. Without the downspout extension, water collected in a window well and eventually flooded the basement.

It was no fun coming home from their honeymoon to this, but they had insurance, so at least they wouldn’t have to deal with it themselves. At least that’s what they thought. It turned out that because the water came in from the outside, their policy did not cover the damage. They were told they would have needed a separate flood policy for that situation. They discovered that, if the water had originated from inside the home (a water heater failure, for example), the damage would have been covered.

The point isn’t to be paranoid, but to have a basic understanding of what your policy covers and what it excludes.

A few questions worth asking your insurance agent:

• • In your experience, where are people most surprised? What kinds of claims do homeowners most often assume are covered, but aren’t?
  • If we’re away and something happens—especially water—what does the policy require us to do?
  • What are the most common ways people inadvertently create coverage problems?

HOA / attached-home-related questions:

• • Can you review the HOA master policy and tell me what it covers vs what my personal policy needs to cover?
  • Do I need ‘walls-in’ coverage (studs-in), and what exactly does that include for this unit?
  • Do I have loss assessment coverage? What’s the limit, and do you think that’s sufficient?

The bottom line? Don’t assume. Before closing, ask your agent a few direct questions, and if you’re buying a townhome or condo in an HOA, make sure your personal policy is coordinated with the HOA master policy. We’re not insurance agents and can’t tell you what your policy does or doesn’t cover—but we can tell you people are often surprised by exclusions, and it’s worth getting clarity now.

If you’ve sold a home in the past 30 years, you likely paid a commission not only for the agent you hired (the listing agent) but also for the agent representing the buyer. And if you’ve purchased a home during this time, your agent’s commission was likely paid by the seller. While it was never required for the seller to pay both agents’ commissions, it became the convention in most U.S. markets.

Although these long-standing conventions still hold in many cases, recent changes that took effect in August 2024 may alter the landscape. These updates have sparked widespread discussion and, in some cases, confusion about what has actually changed. In this article, I’ll break down what’s new, what remains the same, and how these changes might affect you if you plan to sell your home.

What Hasn’t Changed

There has always been a misconception that sellers must pay a commission to the buyer’s agent. This was never a rule or mandate. Over time, however, it became the convention. While this practice was common, it was never legally required.

What Has Changed

When agents list a home for sale, they input it into the MLS (Multiple Listing Service). The MLS is the primary database agents use to search for homes for their clients, and it’s also where information is syndicated to popular sites like Zillow, Realtor.com, and many others.

Until August of this year, the MLS displayed the commission the seller offered to pay the buyer’s agent. This is no longer the case. Now, when an agent working with a buyer views a listing, they cannot see whether or how much the seller is willing to pay.

Additionally, agents working with buyers must now establish a formal agreement with their clients before showing them homes. This agreement specifies how much the agent will earn—a detail not previously required.

How These Changes Affect Sellers

It will take time for the real estate market to adjust to these changes, but here’s what we’re seeing so far:

• • Buyer Expectations Remain: Sellers have traditionally covered the buyer’s agent commission, and most buyers still expect this to be the case. Consequently, many sellers continue to pay this expense.
  • Negotiation Dynamics: Buyers must now negotiate directly with their agent to determine compensation. However, many buyers instruct their agents to request this payment from the seller in the purchase contract. If the seller declines, they can counter by removing the buyer’s agent commission. If the buyer cannot cover the commission themselves, they may reject the counterproposal and look elsewhere.
  • Pre-Offer Conversations: In some cases, buyer’s agents contact the listing agent before submitting an offer to discuss commission expectations. Whether or not the seller is willing to pay this commission can significantly influence whether the buyer decides to submit an offer.

Our Advice to Sellers

Market conditions play a significant role in determining how to handle the buyer’s agent’s commission. If your property is attracting multiple buyers or has limited competition, we might recommend negotiating a lower—or even no—buyer’s agent commission. On the other hand, if your property has little interest or faces strong competition, offering to pay the buyer’s agent’s commission may incentivize the buyer and their agent to prioritize your listing.

One way or another, we will determine how much the buyer expects you to pay their agent before deciding how to proceed with an offer. Buyer’s agents often reach out in advance to discuss commission expectations, allowing us to clarify how much the buyer is obligated to pay. If the buyer’s agent doesn’t contact us beforehand, the purchase offer will outline the requested commission. Either way, we should have a clear understanding of their expectations. If the buyer’s agent requests a lower commission than you were willing to pay, you can agree to the lower amount, and we’ll amend the listing contract to reflect the change.

Final Thoughts

The recent changes in the real estate industry may shape new norms and conventions, and the transition may feel uncertain at first. Our role is to guide you through these shifts, providing the information and support you need to make confident, informed decisions that maximize your returns and ensure a successful sale. If you’ve worked with us before, you know our commitment to thorough communication. We’ll always share what we know, what we don’t know, and what we think, ensuring you have a clear understanding to make the best choices for your situation.

(If you’re considering working with us to sell your home, this post is worth your time. While the main idea may seem straightforward, its deeper implications are often missed. We’re asking you to see the home-selling process in a new way that recognizes emotion’s quiet but powerful role. It’s like thinking you know someone’s story, only to truly get to know them and realize there’s so much more beneath the surface.) 

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Selling a home isn’t just about statistics, checklists, or square footage—it’s about how your home makes potential buyers feel. That feeling often determines not just whether your home sells but how quickly and for how much.

We ask you to pause, reflect, and consider this perspective. Even if it feels abstract now, over time—and by the time our work together is complete—you’ll see how these ideas lead to better decisions and, ultimately, better results. This is just the starting point, and it begins with slowing down and recognizing that this process has a deeper layer worth your attention.

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Why Does Emotion Matter?

Think about why you gravitate toward one coffee shop, grocery store, or park over another. Why do certain parts of your home feel inviting while others don’t? What makes you enjoy visiting one friend’s house more than another’s? These places may have similar features, yet something intangible sets them apart—more often than not, it’s emotion.

The same is true when selling your home. Buyers aren’t just purchasing square footage; they’re responding emotionally, often in ways they don’t consciously realize. If your home stirs a strong emotional response, it becomes something they have to have. But if it feels cold, uninviting, or just “fine,” it risks becoming just another option—competing on price alone.

In a hot market, an emotional connection can mean a higher sales price. In slower markets, it can be the difference between selling and sitting unsold. Imagine a sunroom with large windows flooded with afternoon light versus the same room with covered windows blocking the light. The space hasn’t changed, but the feeling has. That’s the power of creating an emotional connection.

A property that doesn’t evoke emotion becomes a commodity. And when something becomes a commodity, price becomes the only deciding factor. That’s why we take a different approach—one that blends art and science.

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Art and Science

We use every tool available to create an advantage. For example, most agents overlook how strategically-written listing comments can start building a buyer’s emotional connection to a home or how a well-crafted email to an agent before a showing can subtly shape expectations. There are countless ways to enhance a home’s emotional appeal, and each listing presents unique opportunities. This creative and strategic process is what we love about what we do.

What I’m describing here is the art of real estate. Some parts of the process should be systematized and repeatable—like ensuring listings appear on all relevant websites, managing showings efficiently, and handling essentials like photography and floorplans. That’s the science of selling a home. But the most valuable part—the part that shapes how buyers feel about your home—is art. We understand the difference. We have tools at our disposal that most agents don’t even realize exist—and we know how to use them. We are artists and craftsmen—not order-takers or robots.

The value of our approach may not be immediately apparent, but by the time the process is complete, our clients get it. We want them to feel good about working with us, and we take responsibility for making that clear as early as possible. This post—and the conversations ahead—serve that goal. Shifting your perspective now will lead to more confident decisions—and better results—in the end.

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In Conclusion

If you take the time to absorb these ideas, you’ll navigate the process with more confidence, less stress, and ultimately, greater financial and emotional value. We don’t expect everything to click immediately—this is just the beginning. These concepts will take shape and become more meaningful as we move forward.

There are many moving parts in a real estate transaction, and we’ll guide you through all of them. But among all the factors that influence a sale, understanding emotion is at the top of the list.

When buying a home with cash, the seller will expect to see a document called Proof of Funds—confirming you have the money available to complete the purchase. Ideally, we’ll include this with your offer, so it’s best to have it ready ahead of time.

When buyers get a loan, their agent includes a pre-approval letter with the offer. That letter proves the lender is likely to fund the purchase. For cash buyers, the equivalent is Proof of Funds, which is usually a recent bank or investment statement showing you have enough liquid funds to cover the purchase price (or more).

Why does the seller care? Because they don’t know you. If they accept your offer, the seller is effectively taking their house off the market; they want to be sure you have the money to pay for their home. Proof of Funds gives them confidence that you’re serious and capable, which can make a big difference, especially if there are multiple offers.

And don’t worry—this doesn’t mean handing over your full account details. You can redact account numbers. The only thing that matters is that your name is on the account and there is at least enough money to pay for the property.

When you sell a home in Colorado, one of the most important documents you’ll complete is the Seller’s Property Disclosure (SPD). This is where you share what you actually know about the property’s condition. It’s not meant to turn you into a home inspector or an engineer. It’s simply your opportunity to tell the truth about what you’ve seen, repaired, or experienced in the home, based on your current actual knowledge.

What the Disclosure Form Actually Says

The official Colorado Seller’s Property Disclosure (Residential) — created by the Colorado Real Estate Commission — begins with this paragraph:

“Seller states that the information contained in this Seller’s Property Disclosure (“SPD”) is correct to Seller’s CURRENT ACTUAL KNOWLEDGE as of this Date. Any changes must be disclosed by Seller to Buyer promptly after discovery. Seller’s failure to disclose a known adverse material fact affecting the Property or occupant may result in legal liability. If the sales contract requires Seller to complete this SPD, this form must be fully completed to Seller’s current actual knowledge, as of the date of the Contract. If Seller has knowledge of an adverse material fact affecting the Property or occupants, it must be disclosed whether there is a specific item on this SPD or not. If the Property is part of a Common Interest Community, this SPD is limited to the Property or unit itself, except as stated in Section O. Broker may deliver a copy of this SPD to prospective buyers.”

That’s a long paragraph — here are a few things to note:

Describe What You Know — Not What You Think

“Current actual knowledge” means what you truly know — not what you suspect or think might be true. If you don’t know the cause, don’t guess at it. Describe what you can see and what you know for certain. For example:

• • What you know: “There is a round water stain on the family-room ceiling, about 8 inches in diameter, near the light fixture.”
  • Speculative: “The roof leaks.”

The first statement is factual and based on observation. The second is an interpretation — and it can unintentionally mislead or raise unnecessary concern. It’s fine (and right) to describe both the condition and its cause if you actually know the cause. For instance:

• • Appropriate: “The basement flooded in 2018 after a heavy storm.”
    You’re describing an event you experienced, along with a cause you know.
  • Speculative: “The flooding was caused by poor drainage around the foundation.”

If you know the issue is poor drainage — because a professional confirmed it, or you’ve repaired it and understand what caused it — then you’re obligated to disclose that. But if you don’t know the cause, don’t guess. Describe what happened, not what you think explains it.

Disclose Adverse Material Facts — Even If the Form Doesn’t Ask

The SPD attempts to cover a wide range of issues, but it can’t list every possible problem a property might have. That’s why the Commission includes this line: If Seller has knowledge of an adverse material fact affecting the Property or occupants, it must be disclosed whether there is a specific item on this SPD or not. In other words, if you know something about the property that meets that definition — an adverse material fact — you still need to disclose it even if there’s no checkbox for it on the form. If you know it, disclose it — whether the form specifically asks about it or not.

Keep It Current

If you learn new information before closing, please notify us immediately. We can help you properly update the disclosure so everything remains accurate and complete. The SPD requires that any changes be disclosed “promptly after discovery.” That protects everyone — including you — by keeping the information current and transparent.

Why This Matters

Disclosure isn’t just paperwork; it’s protection. Being transparent protects buyers from surprises and protects you from future claims. If you fail to disclose something you actually knew about, and the buyer later discovers it, you could face a claim for nondisclosure or misrepresentation. The SPD says it plainly: “Seller’s failure to disclose a known adverse material fact affecting the Property or occupant may result in legal liability.” The key word is known. You aren’t responsible for discovering hidden defects or offering expert opinions — only for being honest about what you do know.

Our Role

As your broker, our role is to help you understand how to complete the disclosure — not to provide legal advice or interpret the law. We also have my own disclosure obligations under Colorado law. Under C.R.S. § 12-10-407, we’re required to disclose to potential buyers any adverse material facts actually known to us. Our role is to work with you to make sure both of us are transparent and compliant throughout the process. If you ever have questions about whether something qualifies as a “material fact” or how best to word a disclosure, we can help you think it through. If something feels uncertain or has a legal nature, you may also wish to consult an attorney for interpretation.

In Short

• • Disclose what you know, not what you guess.
    Stick to what’s within your current actual knowledge.
  • Describe facts — and, if you know the cause, include it accurately.
    It’s fine to say what happened and why, as long as you know both are accurate.
  • If you know an adverse material fact, disclose it — even if there’s no specific question for it.
  • If you learn something new before closing, please let us know so we can assist you in updating the disclosure properly.