Colorado real estate companies anticipate a year of change, as more agents leave the business, the market continues to stagnate because of high interest rates, and a growing number of companies merge or close.
Commission changes
Despite last summer’s landmark court settlement by the National Association of Realtors, which was expected to lower commissions, Denver-area real estate companies say they have experienced few changes.
“We have seen a change, but so far it has been a modest change,” said Jon Larrance, broker-owner of Corcoran Perry Co., which ranked sixth for small businesses on this year’s Top Workplaces list.
The lawsuit also set the stage for higher commission rates and “paved the way for real estate agents to charge upfront retainers like lawyers and other respected professionals do. The best practitioners will always demand the highest compensation rates while part-time agents fight over clients looking for the deepest discounts.”
New Home Star Market Strategist Dan White said while agent commissions might decrease, real estate companies can keep agent pay steady by increasing fees.
A tough market
Real estate agents continue to navigate a challenging market with interest rates above 6%. Despite inventory increasing in the past few months, home prices remain elevated, and sales aren’t keeping pace.
The metro recorded 1,061 closed sales for the first quarter of 2025. That’s up 7% from 988 in 2024, up 22% from 870 in 2023, down 8% from 1,147 in 2022, and up 20% from 885 in 2021.
The median home sale price in March for the Denver metro was $599,000. That’s down 3.9% from its April 2022 peak, but it still shows an annual appreciation of almost 7% over the past five years.
The housing market has remained largely stagnant for the past two years, following a surge during the pandemic.
That may encourage some agents to leave the job.
“Yes, the market is challenging, and some agents will leave,” said operations manager Liliana Mendez with Madison & Co. Properties, which ranked first for midsize businesses on this year’s Top Workplaces list.
“However, experienced, well-supported agents—like those at Madison—are well-positioned to thrive and gain market share.”
Stacie Staub, West + Main CEO, said the company has lost a few agents and doesn’t anticipate losing many more.
“We have better retention and higher growth than our competitors, partly because our fees and commission splits are more affordable than most, allowing agents to maintain their license with us even if they are not doing as many sides as they typically do,” she said.
Real estate companies need to provide support to their agents, said New Home Star market director Chris Laskowski.
“As a leader in new home sales, we pride ourselves on our ability to bolster sales agents in slower selling seasons and celebrate alongside them during busy ones—something all new home sales companies should do to retain talented agents.”
Larrance said that despite predictions that agents would flee the industry, that isn’t happening, and he hasn’t seen a significant reduction in the number of real estate licenses.
“It’s not that expensive to maintain an active real estate license while having a full-time job in another industry,” he said.
However, buyers and sellers face additional risks when working with part-time agents.
“The upshot of that is we see more unprofessional behaviors and unethical treatment of the consumer played out by those part-time agents due to the fact that they are not actively engaged in the business or the changing regulations,” Larrance said.
Will agencies close or merge?
Colorado real estate companies anticipate more shakeups in their industry, including agency closures and mergers.
Earlier this year, Rocket Companies, a leading mortgage broker, acquired Redfin, a digital real estate brokerage. The Wall Street Journal reported that Compass is in advanced talks to acquire Berkshire Hathaway’s HomeServices of America, which includes Denver-based Kentwood Real Estate.
White with New Home Star, which ranked 60th among the best small businesses, predicts that mergers and the increasing prevalence of homebuyers using internet listing sites like Zillow, Redfin, and Realtor.com will lead to a leaner workforce with fewer real estate agents.
Smaller brokerages may struggle, Mendez said. However, Madison’s strong foundation, reputation, and adaptability position us for continued success, even with market shifts.
Staub said West+Main, which ranked second for midsize businesses this year, is often approached about potential interest in selling or merging. She said the industry is experiencing mergers and acquisitions not only between brokerages but also with finance, mortgage, and title companies.
