In most home sales, the seller traditionally covers the realtor fees, commonly known as real estate agent commissions. These fees generally amount to between 5% and 6% of the home's selling price.
For instance, if a home sells for $500,000 with a total commission rate of 5.5%, the realtor fees would come to $27,500. This includes the seller's agent and buyer's agent fees, and doesn't include other seller closing costs like transfer taxes and title insurance.
However, significant changes have emerged following a major lawsuit settlement in August 2024. The settlement mandates that sellers are no longer required to pay the buyer’s agent fees, a shift that could result in lower overall commission rates and lead to more direct negotiations between buyers and sellers.
You don't need to settle for steep commission fees. At Real Estate Witch, we link you with seasoned, full-service agents charging just 1.5% in listing fees—about half the national average. Start saving thousands on realtor fees by taking a quick quiz to match with a top-rated local agent today!
Who actually pays realtor fees in a home sale?
Understanding who pays the realtor fees in a property transaction can be complex. Typically, the seller is responsible for paying both the listing agent's and buyer's agent commission, with the exact amount usually spelled out in the contract or seller's listing agreement.
Imagine a home sells for $500,000 with a total commission of 5%. This means a total fee of $25,000 is deducted from the home's final sale price, and leaves the seller with $475,000 (before paying any closing costs or settling mortgages).
Keep in mind that while these fees are standard, they are 100% negotiable, and can vary based on the local market. Recent legal changes from the NAR settlement also affect these negotiations, particularly in how the buyer’s agent’s fee is handled.
How much do realtors charge?
Realtor fees are typically 5–6% of the home’s purchase price. The nationwide average commission rate is 5.32%, according to a 2025 survey of agents by Clever Real Estate.
The total commission ranges from 2.5–3% for the listing agent and their broker and 2.5–3% for the buyer’s agent and their broker.
On a $500,000 home sale at a 6% commission rate, each agent makes about $15,000.
| Percentage | Dollar amount* | |
|---|---|---|
| Listing agent commission | 3% | $15,000 |
| Buyer's agent commission | 3% | $15,000 |
| Total commission | 6% | $30,000 |
Average realtor commission by state
Realtor fees often vary by state. Several regional factors impact commission rates, such as:
- Home sale prices
- Market trends
- Supply and demand
- Average time to sell
- Marketing expenses
- Cost of living
- Your property's characteristics (e.g., location, condition)
Clever recently surveyed agents nationwide to learn the average commission rate in each state.
The survey found that rates can vary significantly — by more than a percentage point sometimes. For example, New Hampshire real estate agent commission costs about 5.25%, while Ohio real estate commission costs 5.60%.
Find out how much average realtor fees are in your state:
| State | Total commission | Buyer commission | Seller commission |
|---|---|---|---|
| Alabama | 5.31% | 2.50% | 2.81% |
| Alaska | 5.04% | 2.47% | 2.57% |
| Arizona | 5.40% | 2.62% | 2.78% |
| Arkansas | 5.30% | 2.55% | 2.75% |
| California | 4.99% | 2.45% | 2.54% |
| Colorado | 5.29% | 2.62% | 2.67% |
| Connecticut | 5.25% | 2.57% | 2.68% |
| Delaware | 5.30% | 2.55% | 2.75% |
| Florida | 5.05% | 2.42% | 2.63% |
| Georgia | 5.62% | 2.71% | 2.91% |
| Hawaii | 5.04% | 2.47% | 2.57% |
| Idaho | 4.68% | 2.30% | 2.38% |
| Illinois | 5.07% | 2.43% | 2.64% |
| Indiana | 5.31% | 2.50% | 2.81% |
| Iowa | 5.51% | 2.60% | 2.91% |
| Kansas | 5.51% | 2.60% | 2.91% |
| Kentucky | 5.30% | 2.55% | 2.75% |
| Louisiana | 5.30% | 2.55% | 2.75% |
| Maine | 5.25% | 2.57% | 2.68% |
| Maryland | 5.30% | 2.55% | 2.75% |
| Massachusetts | 4.47% | 2.03% | 2.44% |
| Michigan | 5.86% | 2.93% | 2.93% |
| Minnesota | 5.77% | 2.62% | 3.15% |
| Mississippi | 5.30% | 2.55% | 2.75% |
| Missouri | 5.73% | 2.76% | 2.97% |
| Montana | 4.68% | 2.30% | 2.38% |
| Nebraska | 5.51% | 2.60% | 2.91% |
| Nevada | 3.51% | 1.66% | 1.85% |
| New Hampshire | 5.25% | 2.57% | 2.68% |
| New Jersey | 5.07% | 2.52% | 2.55% |
| New Mexico | 5.68% | 2.83% | 2.85% |
| New York | 5.36% | 2.64% | 2.72% |
| North Carolina | 5.47% | 2.57% | 2.90% |
| North Dakota | 5.51% | 2.60% | 2.91% |
| Ohio | 5.60% | 2.68% | 2.92% |
| Oklahoma | 5.68% | 2.83% | 2.85% |
| Oregon | 5.00% | 2.42% | 2.58% |
| Pennsylvania | 5.35% | 2.60% | 2.75% |
| Rhode Island | 5.25% | 2.57% | 2.68% |
| South Carolina | 5.36% | 2.61% | 2.75% |
| South Dakota | 5.51% | 2.60% | 2.91% |
| Tennessee | 5.54% | 2.63% | 2.91% |
| Texas | 5.76% | 2.89% | 2.87% |
| Utah | 4.68% | 2.30% | 2.38% |
| Vermont | 5.25% | 2.57% | 2.68% |
| Virginia | 5.19% | 2.57% | 2.62% |
| Washington | 5.18% | 2.56% | 2.62% |
| Washington, D.C. | 4.82% | 2.29% | 2.53% |
| West Virginia | 5.30% | 2.55% | 2.75% |
| Wisconsin | 5.78% | 2.47% | 3.31% |
| Wyoming | 4.68% | 2.30% | 2.38% |
| National average | 5.32% | 2.58% | 2.74% |
Remember, commissions are negotiable no matter where you live. We negotiate discounted realtor fees with our agent network to help you save big.
You can get a pre-negotiated 1.5% listing fee when you use our service. And these aren't "discount" agents. We partner with top-rated realtors from name-brand brokerages like Keller Williams, Century 21, and RE/MAX. You get the same full service for a fraction of the typical rate. Fill out this short quiz to get matched to top-rated local agents today!
NAR lawsuit settlement update
The National Association of Realtors (NAR) and some large real estate brokers recently settled a lawsuit from November 2023. NAR has agreed to pay $418 million over four years without admitting wrongdoing.[1]
The key outcomes from the lawsuit settlement include:
- Listing agents can no longer advertise buyer’s agent fees. This change shifts the responsibility to buyers and their agents to negotiate fees directly – rather than the seller dictating the buyer’s agent’s compensation.
- Seller concessions. Modifications to Multiple Listing Services (MLSs) now include a field for seller concessions, often expressed as a percentage. If the concession offered by the seller exceeds the buyer’s agent fee, the buyer may retain the difference, potentially leading to cost savings for buyers.
- Buyer’s agency agreements are mandatory. Before representing clients or showing properties, buyer’s agents must obtain a signed agreement detailing the services and fees. This mandate aims to increase transparency for buyers.
- Settlement payments for impacted sellers. NAR will pay $418 million to past sellers over approximately four years. Eligible sellers may qualify for settlement payments.
"There is a lot of confusion and misunderstanding. In time, these changes will become the new normal and I don't see it being an issue," says Tom Townsend, a realtor based in Atlanta, GA.
Some agents anticipate significant shifts in the industry, foreseeing that less successful or part-time agents may exit the field.
According to agent Lisa Ragland, this shift could benefit established professionals. "Especially those who offer flexible commissions, providing them with opportunities to excel in their local markets and deliver superior service to their communities," she says.
» Want to learn more? Check out the NAR’s big agreement
What do realtor fees cover?
The fees compensate agents for the time they devote to your real estate transaction.
For buyers, this typically includes the following services:
- 📈 Educating you on the home-buying process and market trends
- 🏦 Connecting you to lenders for pre-approval and financing
- 🔎 Finding properties that meet your needs and budget
- 🏠 Scheduling showings and attending open houses
- 📝 Writing and submitting offers
- 📋 Assisting with paperwork and explaining legal terms
- 🛠️ Helping you set up inspections and the appraisal
- 🤝 Negotiating deals and facilitating closing
For sellers, realtor fees typically cover services such as:
- 🏡 Offering pre-listing advice, such as improvements to enhance the property value
- 📊 Analyzing market conditions to time the sale effectively
- 💲 Researching comparative sales with a CMA report and developing a pricing strategy
- 📸 Arranging for high-quality photos, virtual tours, and 3D home modeling
- 📝 Crafting a compelling listing description
- 💻 Listing the property on the multiple listing service (MLS)
- 📣 Marketing your property listing
- 👥 Networking with other realtors to find potential buyers
- 🤝 Negotiating deals and facilitating closing
Always check with your agent upfront to learn what services they do and don't include in their standard fees. This way, you and your agent will be on the same page.
» MORE: How much do real estate agents make?
Are realtor fees negotiable?
Realtor fees are indeed negotiable, though the success of such negotiations can vary widely depending on several factors including market conditions, the demand for homes, and the realtor's willingness to adjust their rates.
Recent data from the National Association of Realtors (NAR) indicates that while negotiations are possible, they are not always successful. According to the study, 19% of sellers who discussed lowering fees with their agents could negotiate a reduced commission. However, a smaller fraction, about 5%, attempted to negotiate but could not secure a lower rate.[2]
Sellers who are considering negotiating fees should prepare by understanding their local market, the value their agent brings to the table, and by being ready to discuss these points effectively with their realtor.
» MORE: How to negotiate your real estate commission
How to reduce realtor fees
Negotiating realtor fees isn't the only way to save on realtor commission. Here are two alternative approaches.
Use a discount brokerage
One of the best ways for home sellers to save money on realtor fees is to work with a discount real estate brokerage.
These companies offer built-in savings on listing fees — no negotiation necessary. In addition, their agents provide all the same services that traditional realtors offer.
Here are the best discount brokerages for home sellers:
The top discount brokerages have agents who provide the same support and service as traditional realtors.
Sell for sale by owner (FSBO)
When you sell your home without a realtor, you don't need a listing agent, which means you can save on listing fees (2.5–3%), although you'll still likely need to pay a buyer's agent fee.
Remember that selling FSBO requires you to handle all the tasks a listing agent typically manages, which can be challenging and time-consuming. Also, many FSBO sellers just aren't successful. Consider these statistics:
- FSBO sales represented only 6% of all home sales last year.[3]
- FSBO homes sell for a median of $380,000, well below the median sale price of $435,000 for all homes.[3]
So, while selling FSBO can save you money on fees, it's crucial to weigh that benefit against the work you'll have to do and the potential for a lower sale price.
FAQ about realtor fees
Are realtor fees negotiable?
Yes. You can always ask your realtor for a lower commission rate. It's best to do this upfront before you start working together. Alternatively, you can work with an agent matching serivce, which pre-negotiates reduced commission rates with its agent network so you don't have to do any awkward negotiating!
How can I save money on realtor fees?
You can save money on realtor fees in several ways. One method is using a discount real estate brokerage. These brokerages offer lower listing fees without you having to negotiate, and they provide the same services as traditional realtors.
Selling for sale by owner (FSBO) is another option. You don't use a listing agent or pay a 2.53% listing fee. However, youll still want to offer a competitive commission to the buyer's agent. While selling FSBO can save on fees, FSBO homes often sell for less than homes represented by an agent.
What percentage do most real estate agents take on a home sale?
Realtors usually charge a total commission of 56% of the sale price, split between the listing agent and the buyer's agent. The national average commission rate is 5-6%. For a $500,000 home at a 6% rate, each agent earns approximately $15,000. The seller usually pays the commission for both agents.
What's a fair realtor fee?
Realtor fees depend on multiple factors, including your home, your local market, and the level of support you need. In most cases, if you work with a traditional real estate agent, youll likely end up paying the average commission rate for your state.
How are realtor fees paid out?
During closing, the title company or attorney deducts the realtor fees from the seller's proceeds. They distribute the commissions to the agents' brokerages, who take their cut and then pay the agents. You don't have to worry about mailing a check or handing cash to the agents the title company handles everything.
Related reading
What Companies Offer the Lowest Real Estate Commission Fees? Working with a low commission realtor is one of the best ways to save money when you sell your home. Here's an in-depth review of the best low-cost realtors!
How Does a 3% Realtor Commission Work? Learn how the traditional 3% commission model works and tips to save on commission.
Negotiating Realtor Fees: Check out our guide on negotiating realtor fees effectively. Getting a lower rate could save you thousands.
Zillow For Sale By Owner Fees: Zillow doesn’t charge FSBO sellers any listing fees, but is it worth selling your home on its website? Find out here.
How Much Does It Cost to Sell a House? We break down the true cost of selling a home, including common costs like realtor commission, seller closing costs, and optional pre-sale expenses.