What Is Real Estate Commission?

Real estate commission is the fee paid to the real estate agents involved in a home sale. Typically, this is a percentage of the final sale price of the home, often around 5% to 6%. That percentage is usually split between the listing agent (who represents the seller) and the buyer’s agent.

So, for example, if your home sells for $400,000 and the commission rate is 6%, the total commission would be $24,000. That’s generally split down the middle, with each agent earning $12,000.

Who Actually Pays the Commission?

Here’s the truth: the seller pays the full commission.

When a home is listed for sale, the commission is baked into the asking price. So while the buyer doesn’t write a separate check for the commission, the seller agrees upfront to pay the commission out of the proceeds from the sale.

This means if your home sells for $400,000 and you owe a 6% commission, you’ll net $376,000 (before other closing costs).

But Doesn’t the Buyer Pay Indirectly?

In a way, yes.

Because the commission is included in the overall purchase price, buyers are indirectly contributing to the commission. They’re essentially financing it as part of their mortgage or overall payment.

So while sellers are technically responsible for the payment, buyers may feel the impact in the form of higher listing prices. It's all part of the larger negotiation and pricing strategy.

What Does That Commission Cover?

This is where the value of working with a professional shines through.

A good agent doesn’t just list your house—they offer:

• Pricing strategy based on market data

• Professional photography and marketing

• Online and offline advertising

• Scheduling and hosting showings

• Negotiation expertise

• Navigating inspections and contracts

• Coordinating closing logistics

That commission covers the time, tools, and expertise needed to sell your home faster and for more money.

Can You Negotiate the Commission?

In many cases, yes—commission is negotiable. Some agents may offer flexibility depending on the situation, the market, and the level of service provided. However, remember: you often get what you pay for. A lower commission might mean less exposure, limited marketing, or reduced support.

It’s important to evaluate the full value your agent brings to the table—not just the cost.

Final Thoughts: Clarity Is Power

Understanding how real estate commission works helps you make more informed decisions during the selling process. While sellers technically pay the commission, it’s part of the larger pricing and value equation that ultimately affects both parties.

If you’re preparing to sell your home and want clarity on what to expect in terms of costs, marketing, and negotiation, I’d be happy to walk you through your options.

📞 Ready to sell smart? Let’s connect for a no-pressure consultation and talk about how to get top dollar for your home—with full transparency and support.