Real Estate Commission Calculator

The typical real estate commission rate in the United States ranges from 5% to 6% of the home's sale price. This commission is usually split between the buyer's agent and the seller's agent, with each receiving 2.5% to 3%. However, commission rates are negotiable and can vary based on location, property type, and market conditions.

Real estate commissions are typically split multiple ways: first between the listing and buyer's agents (usually 50/50), then between each agent and their respective broker. Agent-broker splits commonly range from 50/50 for new agents to 90/10 or higher for experienced agents. Some brokerages offer 100% commission with monthly fees instead.

Traditionally, the seller pays the real estate commission for both the listing agent and the buyer's agent. The commission is deducted from the seller's proceeds at closing. However, recent legal changes and NAR settlement updates may affect how commissions are structured and paid in the future.

Yes, real estate commissions are always negotiable. There is no standard or fixed commission rate set by law. Sellers can negotiate the commission rate with their listing agent, and agents may adjust their rates based on property value, market conditions, services provided, or competition in the area.

Agents typically pay various business expenses from their commission, including: broker splits (30-50% of gross commission), MLS fees, licensing and continuing education, errors and omissions insurance, marketing costs, transaction fees, professional association dues, office expenses, and self-employment taxes (15.3%). After expenses, agents often net 40-60% of their gross commission.

On a $500,000 house with a 6% total commission ($30,000), if the commission is split equally between buyer and seller agents, each receives $15,000. After a typical 70/30 broker split, the agent would earn $10,500 gross. After business expenses and taxes, the net income might be $6,000-$8,000, depending on individual circumstances.

New real estate agents typically receive a 50/50 to 60/40 split with their broker, meaning they keep 50-60% of their commission while the broker receives 40-50%. Some brokerages offer tiered splits that improve as agents close more transactions or reach certain production levels. Experienced agents often negotiate 70/30, 80/20, or even 90/10 splits.

Yes, discount brokers typically charge 1-2% listing commissions compared to traditional 2.5-3% rates. However, they may offer fewer services, such as limited marketing, minimal staging advice, or reduced availability. Some discount brokers charge flat fees ($3,000-$5,000) instead of percentage-based commissions, which can save money on higher-priced homes.

Transaction fees (also called broker fees or administrative fees) are flat charges ($200-$500 per transaction) that brokerages assess to cover administrative costs like document preparation, compliance, and technology. These fees are deducted from the agent's commission and are separate from the broker split, reducing the agent's net earnings.

In real estate teams, commissions are split among team members based on their roles. A typical structure: the team lead gets 30-50%, the buyer's or listing agent gets 30-40%, and showing agents or transaction coordinators get 10-20%. The team's total commission is first split with the brokerage, then divided among team members according to their agreement.

Gross Commission Income (GCI) is the total commission an agent earns before any splits, fees, or expenses are deducted. For example, if a property sells for $400,000 with a 3% buyer's agent commission, the GCI is $12,000. After broker split and fees, the agent's net income would be significantly less, typically 40-70% of GCI.

100% commission brokerages allow agents to keep their entire commission in exchange for monthly fees ($50-$500), per-transaction fees ($250-$495), or annual desk fees ($1,000-$3,000). This model benefits high-producing agents who close multiple transactions monthly. However, these brokerages typically offer minimal support, training, or leads compared to traditional splits.