Real Estate Co-op Commissions Make a Positive Difference!

Recently, we were asked by a client with a significant inventory problem in Denver, “Other than pricing which is a given, what would be the next best marketing idea to garner greater attention for their properties?”  We responded with the hypothesis, “By offering a higher co-op to the buyer’s broker, the net result would be positive.”

They asked us to prove it. So, we went into the market as the report below illustrates and provided the data.  Then we completed a four property test offering a 4% co-op.  The data and the test confirmed virtually the same results.

Let me demonstrate how:

The Denver metro Brokers normal co-ops range from 2.8% to 3.0% (As Reported in our Metrolist Managed System).  By lowering gross commissions, it forces listing brokers to lower their co-op.  The attached co-op analysis demonstrates the impact of reduced co-op commissions and the negative impact on that asset.

Attached are various co-op analyses and graph from our Denver Metro MLS.  Please note how the listing’s performance is positively or negatively impacted in “direct” proportion to the “co-op commissions”. The analysis was based on a data set of over 24,000 single family homes that sold within the last 12 months in the Denver Metro Area regardless of price.

The following is a summary of the Denver Metro MLS co-op performance on the accompanying chart:

1% to 2.7% CO-OP:

Days on Market: 123

Average Price to Original Listed Price: 88.35%

2.8% to 3.0% CO-OP:

Days on Market: 103

Average Price to Original Listed Price: 90.85%

3.1% to 5% CO-OP:

Days on Market: 79

Average Price to Original Listed Price: 97.22%


The Affect of Coop Rates on Sales Price and Marketing Time

The Affect of Coop Rates on Sales Price and Marketing Time


“The proof is in the pudding!”

About Tom & Dee Cryer

Your Trusted Advisors in the Homeownership Business!
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