The average real estate commission nationwide is 5.32% nationwide typically ranges from 5% to 6% of a home’s sale price. This rate includes an average of 2.74% for the selling agent plus 2.58% for the buyer's agent.[1]
Here's what 5.32% works out to for three different price points:
- $14,364 home: $14,364
- $28,728 home: $28,728
- $47,880 home: $47,880
Realtor fees are one of the biggest expenses when selling a home. Fortunately, there are ways to spend less on realtor commission and increase your profit.
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Commission rates are trending lower
Recent industry developments and commission rate changes, including the National Association of Realtors (NAR) settlement, have contributed to downward pressure on commission rates. These changes have provided sellers with greater flexibility in negotiating realtor fees.
While rates have been trending down slightly since the settlement, especially for buyer’s agents, the total average commission rate for selling remains between 5% and 6%.[2]
Commission rates have been gradually decreasing due to:
- Increased competition among agents.
- Emerging discount brokerage models.
- The impact of regulatory changes, such as the NAR settlement.
Some agents are willing to list a house for significantly less than 2.45% commission while still providing full service. Clever Real Estate pre-negotiates a 1.5% listing fee with top-rated local agents for you. Try Clever today to find low-commission agents in your area!
What does real estate commission cover?
Real estate commission compensates agents for their comprehensive services, including:
- Marketing the property: Agents often advertise homes for sale using professional photography, MLS listings, and digital media.
- Negotiating offers and managing counteroffers: Agents are expert negotiators and work as advocates for their clients.
- Coordinating inspections and appraisals: Most home sales involve both an inspection and an appraisal. An agent can help find these specialists and arrange time for them to see the home.
- Navigating the closing process: A big part of an agent’s job involves ensuring that all of the i’s are dotted and t’s are crossed to proceed with the transaction.
Commission rates are negotiable
Contrary to popular belief, commission rates are not fixed. Sellers can and should negotiate realtor fees to maximize savings.
Before listing your home, research average commission rates in your area and discuss fees and services with potential agents. Comparing agents and negotiating can help you save thousands of dollars.
Another option is to consider working with a company that pre-negotiates a lower rate on your behalf. Our agent matching service partners with top local agents who offer a 1.5% listing fee.
You'll get the same comprehensive service while saving 50% on listing fees. On a $400,000 home, this can mean savings of up to $5,000! Get matched with a 1.5% listing agent today!
What is the average real estate commission in the U.S.?
Recent in-house data analysis indicates the national average real estate commission rate is 5.32%. Here’s how this typically breaks down:
| Average rate | Commission for a $270,000 home | Commission for a $540,000 home | Commission for a $900,000 home | |
| Listing agent commission | 2.74% | $7,398 | $14,796 | $24,660 |
| Buyer’s agent commission | 2.58% | $6,966 | $13,932 | $23,220 |
| Total realtor fees | 5.32% | $14,364 | $28,728 | $47,880 |
Factors influencing real estate commission rates
Commission rates fluctuate depending on a number of variables, including:
- Location: Regional norms significantly affect commission percentages. For example, high-demand markets often have lower rates.
- Market conditions: In a seller’s market, agents may accept lower fees due to an anticipated quick sale.
- Home value: High-value homes often result in lower percentage-based rates.
- Agent services: Full-service agents with extensive marketing and support may charge higher fees.
Regional and state variations in commission rates
Commission rates vary significantly by state and region. Markets with high competition among agents or higher home prices tend to have lower rates. Rural or less competitive markets often see higher percentages due to fewer agents.
Find your state in the table below to see average commission rates in your area.
| State | Total commission[1] | Comparison to national average |
|---|---|---|
| Alabama | 5.31% | about equal to national average |
| Alaska | 5.04% | less than national average |
| Arizona | 5.40% | higher than national average |
| Arkansas | 5.30% | about equal to national average |
| California | 4.99% | less than national average |
| Colorado | 5.29% | less than national average |
| Connecticut | 5.25% | less than national average |
| Delaware | 5.30% | about equal to national average |
| Florida | 5.05% | less than national average |
| Georgia | 5.62% | higher than national average |
| Hawaii | 5.04% | less than national average |
| Idaho | 4.68% | less than national average |
| Illinois | 5.07% | less than national average |
| Indiana | 5.31% | about equal to national average |
| Iowa | 5.51% | higher than national average |
| Kansas | 5.51% | higher than national average |
| Kentucky | 5.30% | about equal to national average |
| Louisiana | 5.30% | about equal to national average |
| Maine | 5.25% | less than national average |
| Maryland | 5.30% | about equal to national average |
| Massachusetts | 4.47% | less than national average |
| Michigan | 5.86% | higher than national average |
| Minnesota | 5.77% | higher than national average |
| Mississippi | 5.30% | about equal to national average |
| Missouri | 5.73% | higher than national average |
| Montana | 4.68% | less than national average |
| Nebraska | 5.51% | higher than national average |
| Nevada | 3.51% | less than national average |
| New Hampshire | 5.25% | less than national average |
| New Jersey | 5.07% | less than national average |
| New Mexico | 5.68% | higher than national average |
| New York | 5.36% | higher than national average |
| North Carolina | 5.47% | higher than national average |
| North Dakota | 5.51% | higher than national average |
| Ohio | 5.60% | higher than national average |
| Oklahoma | 5.68% | higher than national average |
| Oregon | 5.00% | less than national average |
| Pennsylvania | 5.35% | higher than national average |
| Rhode Island | 5.25% | less than national average |
| South Carolina | 5.36% | higher than national average |
| South Dakota | 5.51% | higher than national average |
| Tennessee | 5.54% | higher than national average |
| Texas | 5.76% | higher than national average |
| Utah | 4.68% | less than national average |
| Vermont | 5.25% | less than national average |
| Virginia | 5.19% | less than national average |
| Washington | 5.18% | less than national average |
| Washington, D.C. | 4.82% | less than national average |
| West Virginia | 5.30% | about equal to national average |
| Wisconsin | 5.78% | higher than national average |
| Wyoming | 4.68% | less than national average |
| National average | 5.32% | — |
Why are real estate commissions so high?
Real estate agents provide significant value in selling homes:
- Marketing costs: Professional photography, staging, and MLS fees add up.
- Negotiation skills: Experienced agents can secure better offers.
- Brokerage splits: Agents often share their commission with their brokerage, reducing their take-home pay.
How to save on real estate commission
- Negotiate realtor fees: Many agents are open to reducing their rates, especially in competitive markets.
- Use a low-commission brokerage: Companies like Clever and Redfin offer lower fees while maintaining full-service support.
- Sell FSBO (for sale by owner): Skipping agents entirely can eliminate commission costs but requires more effort and expertise.
Trends impacting real estate commissions
- Regulatory changes: The NAR settlement has introduced greater flexibility in commission negotiations.
- Discount brokerage models: Companies like Redfin and Clever are reshaping the commission landscape.
- Future predictions: Experts anticipate further declines in commission rates as technology and competition evolve.
Who pays real estate commission?
In most cases, the seller covers the full commission, which is split between the listing and buyer’s agents. While buyer’s agent fees remain seller-paid in most transactions, sellers do have more flexibility in negotiating these costs after the NAR settlement.
The bottom line
Real estate commission rates are not one-size-fits-all. By understanding average rates, negotiating fees, and exploring alternative models, sellers can save thousands without sacrificing quality service.
Ready to save? Find a top-rated agent offering a 1.5% listing fee today.
