How Much Is Real Estate Commission?


If you’re wondering how much a real estate agent should cost, you’re not alone. The average real estate commission is five to six percent of the sale price. This amount includes both buyer’s and seller’s agents. Commissions are generally calculated at

2.5% of the home’s value. In May 2020, the average home in the US sold for

$284,600, which means an average homeowner paid about $14,230 in commissions. That kind of extra cash would go a long way towards a small car or a down payment on your next property.

Negotiating real estate commissions

One of the hardest parts of selling a home is negotiating real estate commissions. These fees eat into your profit substantially. The good news is that you can negotiate these fees. Here are some strategies to make the process easier. Listed below are some suggestions for successful real estate commission negotiations. Once you’ve done this, you’ll be well on your way to a higher profit. Hopefully, this article will have given you a head start on the process.


You should also be aware of the current market conditions when negotiating real estate commissions. You should know the average rate of commissions in your area, and be prepared to justify why you want a lower rate. In addition, if the market is hot, you can use information about the speed of property sale as leverage. For example, if you live in a hot neighborhood, you might get a lower commission if the house is listed on Airbnb.

Splitting commissions between buyer’s agent and seller’s agent

If you’re thinking about hiring a real estate agent, you may be wondering how to split the commission. Some agents have the option to charge a lower commission, or rebate a portion of it to the buyer. While some agents are reluctant to do so, others do it for the sake of customer service. Either way, your agent will still be earning a commission, but it won’t be taxed as income.


If the commission split is too low, you may have a stingy seller who won’t pay a full commission to your agent. If this is the case, you can consider boycotting that particular home. Another way to ensure a fair commission split is to have a written agreement between the buyer’s agent and the seller’s agent. If the commissions aren’t equal, your agent might be less effective in negotiating a deal with you.

Paying upfront for agent’s services

Agents are prone to stress due to the financial arrangements. Besides, they are expected to perform high business related activities such as making cold calls, setting appointments, and attending training and meetings. They are also under pressure to meet their validation schedules. However, if the agent is paid upfront for their services, they will be able to move much faster and have more time for other important things. Therefore, agents should avoid financial arrangements that require them to pay upfront.


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