Real Estate Commission Calculator: How Much Will You Owe Your Agent?

Written by Cara HaynesFebruary 23rd, 20239 minute read

Real estate commission calculator | How to save on realtor commission | How realtor commissions work | Average realtor commission rates by state | Article summary | FAQ

Our real estate commission calculator helps you estimate the total amount you'll pay in realtor fees when selling your home. You can also use it to see your net profit (after realtor commissions, closing costs, and loan payoff), based on your home's target sales price.

Real estate agent commissions are usually the largest cost associated with selling a home. Nationally, home sellers pay an average total commission rate of 5–6%, with the total split between the seller's agent and the buyer's agent. On a $500,000 home, that's about $27,450 in realtor commissions.

The actual real estate commission you'll pay depends on several factors. Realtor fees are negotiable, and many real estate brokerages offer low commission rates. Factors like location, property type (i.e., commercial vs. residential), and whether your buyer has an agent can also affect the commission you pay.

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Real estate commission calculator

How to calculate real estate commission

Calculate your total real estate agent commission by multiplying the desired commission rate (expressed as a percentage, such as 0.06) by the target list price or final selling price of your home (expressed in dollars).

The real estate commission rate applies to the overall sales price, before you subtract other expenses like your remaining loan payoff, taxes, and closing costs.

Here’s a quick example of how to calculate total real estate agent fees using a 6% commission rate and $500,000 home sale:

  1. Determine your total commission rate. A 6% total commission is typical, but the actual rate will be specified in the listing agreement you sign with your agent.
  2. Divide that total commission rate by 100 (or simply move the decimal point to the left two places). Using our 6% example, this would give you 0.06.
  3. Multiply the total commission rate by the final sale price. So for a $500,000 home, you'd multiply 0.06 x 500,000.
  4. Now you have your total commission! You'd pay $30,000 in total commission (split by your agent and the buyer's agent) out of your sale proceeds at closing.

Here’s the same real estate commission calculation expressed as a single formula:

(6/100) * $500,000 = $30,000

  • Target sale price: Your estimated or desired final sale price for your home. Your real estate agent can prepare a comparative market analysis (CMA) to help you come up with a realistic target final selling price.
  • Total commission: The total commission percentage for both the buyer's and seller’s agents who handle the sale (the seller typically covers both agent fees).
  • Listing fee: The share of the total commission that goes to the seller’s agent for marketing and selling the home.
  • Buyer’s agent fee: The share of the total commission that goes to the buyer’s agent for bringing a qualified buyer who purchases the home.
  • Estimated closing costs: A rough estimate for other transactional costs — like taxes and transfer fees — that sellers typically cover with their sale proceeds at closing.
  • Loan payoff amount: The seller’s remaining balance on their home loan, which they must pay off with sale proceeds at closing. You can usually find this information on your monthly mortgage statement. Or you can request a payoff quote from your lender.
  • Net to seller: Your estimated profit (or deficit) once all your home selling costs and outstanding debts have been deducted from your gross sale proceeds.

How do real estate agent commissions work?

In a conventional real estate deal, the seller’s agent and buyer’s agent each receives a share of the total realtor commission fee after the sale closes.

  • The seller’s agent collects a listing fee for marketing and selling the home.
  • The buyer’s agent collects the buyer’s agent fee for bringing a qualified buyer to purchase the home.

The two real estate agents usually split a full commission roughly down the middle (so if the commission is 6%, each agent gets 3%).

🔎 Example: Standard real estate commission calculation for a $500,000 sale

Commission fee
Listing fee
Buyer’s agent fee
Total commission paid

The actual commission split will be defined in the listing agreement the seller signs with their agent before putting their home on the market. And the commission split won’t always be 50/50.

For example, if the seller is working with a low commission real estate broker or agent, each agent might collect different commission split percentages (ex: the listing agent takes 1.5%, but the buyer’s agent still gets 3%). Side note: That's roughly $5,500 in savings for the seller.

🎯 Let Clever negotiate lower rates for you.

Top local agents, 100% full service, built-in 1.5% listing fees. Try Clever Real Estate for free.

🔎 Example: Low commission realtor calculation for a $500,000 sale

Commission fee
Listing fee
Buyer’s agent fee
Total commission paid

Who pays the realtor commission?

The home seller typically pays the entire commission, which gets split by both agents — the listing agent and the buyer’s agent.

Most sellers don’t pay these fees directly out of pocket. Real estate commission fees are typically baked into the home's list price and taken out of the seller’s net proceeds at closing.

This realtor commission payment structure makes the transaction more affordable for both the seller and the buyer:

  • Buyers can cover their agent’s fee with their mortgage instead of out of pocket.
  • Assuming the seller is netting a profit on the deal, they won’t have to pay anything out of pocket.

Why does the seller pay the buyer's agent commission?

Sellers typically cover the buyer’s agent commission to attract buyers and to sell their home faster, for more money, and with the best possible terms. The buyer's agent commission is considered a marketing expense that benefits the seller in the long run.

Most buyers have to cough up a ton of cash to buy a house: earnest money, down payment, inspection and appraisal fees, closing costs, and more. For many home buyers, adding another 2.5–3% out-of-pocket fee for a real estate agent could price them out from buying a home — or at least disincentivize them in a major way.

But practically speaking, the seller isn’t really paying the commissions at all. Most sellers bake the commission fee into their list price. And the money is always coming from the buyer, whether they pay cash or with a mortgage.

If the buyer is financing the purchase, the benefit is that this additional 5–6% cost gets absorbed into the loan. They still end up paying it, but it’s spread out over many years instead of getting added to the pile of up-front fees.

Can you offer a buyer's agent a lower commission rate?

Nearly 90% of buyers work with an agent.[1] By offering a competitive commission rate, you incentivize those agents to show your home to their buyers.

Even in a competitive market, incentivizing buyer’s agents is crucial: you’ll get more offers from more prospective buyers faster, which increases the odds of a bidding war and a higher sale price. If you don’t offer a competitive buyer’s agent commission, it may significantly shrink your prospective buyer pool and net you a worse outcome on your sale.

Find the average realtor commission rate by state

Average commission rate
North Dakota
New Jersey
New Hampshire
New York
South Dakota*
Washington, D.C.*
Rhode Island
North Carolina
South Carolina
New Mexico
West Virginia
National Average

How to save on real estate commission

You can save on real estate commission by working with a low commission broker or by negotiating with a realtor yourself.

Hire a low commission real estate company

There’s a wave of new real estate companies offering the same general listing services and support as conventional realtors for a low flat fee or percentage (as little as 1–2%) instead of the typical 2.5–3% rate.

Although the percentage difference seems small, it can add up to thousands of dollars in savings for home sellers. Different companies create these savings in different ways:

  • Agent matching services, like Clever Real Estate, connect you with local realtors from top brokerages (think Keller Williams, RE/MAX, Berkshire Hathaway) and pre-negotiate lower commission rates on your behalf.
  • Full-service discount brokers, like Redfin, use technology and team-based service models to lower operating costs and create savings.

» COMPARE: The companies with the lowest commission rates in 2022

If you’re looking to save without sacrificing service, Clever Real Estate is our top pick. It offers some of the lowest rates and biggest average savings of any nationwide brand: 1.5% listing fees (or $3,000 minimum).

Clever matches you with multiple local agents to choose from. And Clever’s partner agents represent top regional and national brokerages, like Keller Williams and RE/MAX. That means you get the same experience and support you’d expect from a conventional realtor — while saving thousands on commission.

🙌 Find the perfect agent, save thousands: Sellers who find their agent through Clever’s free service get pre-negotiated low rates and save an average of $9,600. View Agents.

Discount real estate brokerage Redfin offers a 1.5% listing fee (though minimum fees apply and vary by market). Redfin has some solid agents, but it offers less selection than Clever. The style of service and support is different than what you get through Clever and conventional realtors: expect a slightly more tech-driven, hands-off experience.

Ideal Agent is an agent matching service like Clever, but its rates are higher (2% vs. Clever’s 1.5%). It also offers less selection: you get matched with only one agent (Clever customers can choose between two to three and even more if they want). Ideal Agent has about 2,000 agents nationwide versus Clever’s 18,000 agents.

Try to negotiate a lower commission rate with a conventional realtor

You can absolutely try to negotiate commission rates with a conventional real estate agent. But it can be difficult — and even a bit stressful. You’ll have to negotiate with a professional negotiator, which isn’t very fun to do (at least for most people). And don’t expect a major price reduction — fractions of a percentage point are more realistic.

This is where agent matching services like Clever and Ideal Agent can offer serious value: they have more leverage (a recurring source of new business for real estate agents at no up-front cost) to negotiate lower rates for you. For example, a one-off deal for a 1.5% fee doesn't make sense for an agent. But five 1.5% deals a month start to change the margins and make a big impact on the agent’s overall revenue.

👉 The bottom line: It's 100% worth trying to negotiate rates, especially if you've already found an agent on your own that you really want to work with. Just don't expect a major (or any) price reduction. If you don't have an agent lined up — or just want to compare options, which we recommend — definitely try the agent matching service route.

Agent matching services like Clever, for example, can save you thousands on commission fees compared to if you'd found the same agent on your own. It’s also free with no obligation, so there's no risk in trying it out and seeing if you like the agents Clever matches you with.

Summary: How to calculate real estate commission

  • You can calculate your real estate agent's commission in dollars by dividing the commission percentage by 100, then multiplying it by your home’s sale price.
  • Here's the formula for calculating real estate commission: Commission = (Commission rate / 100) * Sale price
  • Total commission includes both the listing agent’s fee and the buyer’s agent fee, which are typically 2.5–3% each.
  • Sellers usually cover both realtors’ fees out of their sale proceeds.
  • The total average commission rate nationwide is 5.49% — but actual fees vary by agent, brokerage, home value and type, and local market trends.
  • If you’re looking to save on commission, we recommend trying a reputable low commission realtor or an agent matching service, like Clever Real Estate, which pre-negotiates low listing fees with top local real estate agents.
  • You can also try negotiating commission rates with realtors on your own, but it may be harder to get a significant rate reduction.

FAQ about real estate commission calculators

Real estate commissions are usually calculated based on a percentage that’s multiplied by the contract selling price of the home. For example, if the total commission percentage in your listing agreement is 6% and the selling price of your home is $500,000, the total commission fee would be $30,000. Use our real estate commission calculator to easily compare commission costs.

Real estate commissions are calculated based on gross sale proceeds, not net sale proceeds. That means the total commission gets applied to the final selling price of your home, before any closing costs or other fees have been deducted.

An individual real estate agent usually makes between 2–3% commission per home sale, which means you’ll pay a combined total of 4–6% total commission on the sale of your home. That translates to $10,000–15,000 in real estate commission per agent on a $500,000 home sale. If a real estate agent represents both the buyer and the seller of the home, they’d make $20,000–30,000 on a $500,000 home sale. According to the U.S. Bureau of Labor Statistics, the 2021 median income for a real estate agent was $48,340, and the highest 10% of agents earned more than $102,170.[2]

Most real estate agents charge 2.5–3% of a home's final sale price for their services. The national total average commission rate is 5.49%. In a typical home sale, both realtors' commissions (the buyer's and the seller's) are covered by the seller out of the home sale proceeds. You can save on commission fees by trying to negotiate lower rates yourself or finding your agent through a low commission real estate company.

A 3% commission for an experienced agent used to be the standard agent’s commission. However, average commission rates are declining across the real estate industry, making it harder for traditional realtors to justify a 3% commission. You can get a highly qualified, dedicated agent for less than 3%.


National Association of Realtors. "2021 Profile of Home Buyers and Sellers." Accessed July 7, 2022. Updated 2021.


Bureau of Labor Statistics, U.S. Department of Labor. "<em>Occupational Outlook Handbook,</em>Real Estate Brokers and Sales Agents." Accessed July 7, 2022. Updated 2022.