If your brokerage uses AI tools to help screen tenants, price listings, draft marketing, or sort leads, Colorado's AI rules apply to you, and they just changed.
In May 2026, Colorado signed SB 26-189, which repeals and replaces the state's original AI law, SB 24-205. The new law takes effect January 1, 2027 and applies to decisions made on or after that date. It is lighter than the version it replaced. The mandatory risk-management programs and annual impact assessments are gone. What remains are duties around consumer notice, disclosure after an unfavorable outcome, limited consumer rights, and recordkeeping for tools that materially influence consequential decisions, a category that includes housing.
This guide breaks the law into the pieces a brokerage can actually act on, so you can organize your documentation well ahead of the effective date. It is a starting point, not legal advice.
Quick answerBefore January 1, 2027, a Colorado brokerage using AI tools should be ready to show:
- Whether it is a developer or a deployer of each AI tool
- An inventory of every automated tool that influences a consumer decision
- A consumer notice given before a covered tool is used
- A disclosure workflow for unfavorable outcomes
- A process for consumer access, correction, and human review
- A record-retention system that keeps these for at least three years
- Vendor documentation for each third-party AI tool
What actually changed in 2026
SB 24-205, adopted in 2024, had been delayed and was scheduled to take effect June 30, 2026. SB 26-189 replaces it with a framework focused on disclosure, transparency, and targeted consumer protections for automated decision-making technology used in consequential decisions. It adds a sixty-day cure period administered by the Attorney General and sunsets that cure period on January 1, 2030.
For a brokerage, the headline is simple. The heaviest paperwork from the old law is gone, but the duties that touch your day-to-day use of AI tools are still here. The smart move is to document those now, while you have time, rather than during a consumer complaint.
Know your role: developer or deployer
The law assigns different duties to those who build or license AI tools and those who use them. Most brokerages are deployers. You are using a third-party tool, not building one.
Write down, for each tool, whether you are a deployer, a developer, or both. Note that using a tool outside what it was marketed for can change how it is treated. This single determination shapes the rest of your obligations.
Inventory your automated decision tools
You cannot document what you have not listed. Build an inventory of every AI or automated tool in the brokerage, then flag which ones touch consequential decisions like tenant screening, lending, or pricing, as opposed to excluded uses like scheduling or general marketing. Record the vendor and the intended use for each one.
The Real Estate Marketing Compliance Workbook is a useful place to keep tool and approval logs if you want a structured starting point.
Consumer notice, disclosure, and rights
Three duties survive from the old law and matter most to a brokerage:
- Notice before use. When a covered tool will materially influence a decision about a consumer, the consumer should be notified first, in plain language, about the tool's role.
- Disclosure after an unfavorable outcome. If a covered tool contributes to an adverse outcome, the law expects you to disclose the decision and how the consumer can respond. Decide who owns this and how fast it goes out.
- Limited consumer rights. A consumer facing an adverse outcome has limited rights to access information, correct inaccurate data, and request meaningful human review. Build a simple intake so these requests are logged and handled.
Recordkeeping for at least three years
The new law keeps a three-year record-retention requirement running from the date of each consequential decision. Store your notices, disclosures, and consumer requests together, and assign one person to own retention. A documented policy on file is far easier to defend than a scramble after the fact.
What to do before 2027
You have time, which is the whole point of acting now. The practical path is to write the policy, build the templates, and set up the records before the rules and the Attorney General's rulemaking are final, then revisit as guidance settles.
If you want a structured, editable foundation, the Colorado Real Estate AI Policy Starter Kit gives you an AI use policy aligned to Colorado expectations. To show ongoing oversight of how agents use AI, the Broker AI Supervision Log Pack documents that the supervisory duty was met, and the AI Policy Rollout Event Kit helps you actually roll the policy out to your team.
Want to see where your gaps are first?Download the free AI Documentation Readiness Checklist to self-assess the seven areas above before you build anything.
_This article is for general educational purposes only. It is not legal advice or a substitute for the current statute, the Attorney General's rulemaking, or a qualified advisor. SB 26-189 and its definitions may shift through rulemaking before the effective date. Verify each requirement against current Colorado law before you rely on it. E&F Compliance Services does not guarantee compliance or any outcome._
_E&F Compliance Services helps founders and small operators in heavily regulated industries get compliant and stay compliant, from DOT to AI governance. Reach out at_ _team@efcompliance.com__._
_The E&F Compliance Team_