A 3% commission realtor refers to an agent — representing either a buyer or a seller — who charges 3% of the final sale price of a home. This rate is in line with the industry standard, but it's higher than the nationwide average of 2.82% for a seller's agent and 2.75% for a buyer's agent.[1]
However, a 3% commission real estate agent doesn't encompass the total commission in a home sale. The seller usually pays both the listing fee and the buyer's agent fee. If each agent charges 3%, the total commission is 6%. On a $500,000 home, that's $30,000.
The good news is, the traditional 3% commission model isn't set in stone. You have options for cutting that rate in half — leading to huge savings on your home sale or purchase. It's even possible to get a 3% total commission rate by working with a top discount real estate broker offering a lower price for full service.
For example, Clever Real Estate pre-negotiates 1.5% listing fees with top local agents from traditional brokerages like Keller Williams and RE/MAX. You'll benefit from top-notch agent expertise at just a 1.5% listing fee. Compared to 3%, that's $7,500 in savings on a $500,000 home sale.
» SAVE: Answer a few quick questions to find top local agents and get a 1.5% listing fee!
How 3% realtor commission works
Here’s how 3% realtor commission breaks down:
- The listing agent, who assists the homeowner in pricing, marketing, and selling their property, generally receives 2.5–3% of the sale price, averaging around 2.82%.
- The buyer's agent, responsible for bringing a qualified buyer to the table, also gets a similar commission, typically 2.5–3%, with the national average sitting at 2.75%.
- On a $400,000 sale at a 3% rate, the buyer's and seller's agents would each earn $12,000 in realtor commissions. Real estate agents typically get paid at closing.
In a standard real estate sale, sellers typically pay both the listing agent fee and the buyer's agent fee. The nationwide average for the total commission rate is 5.57% of the home’s final sale price. In 2024, most sellers (71%) who used an agent spent 5% or more on commission.[1]
When dealing with realtor commission, remember that the percentage can vary based on factors like location, the specific brokerage firm, and the extent of services provided.
You can also negotiate realtor fees. You can negotiate the commission for your seller's agent before signing a listing agreement. And you can negotiate the buyer's agent fee with the buyer and their agent when the buyer makes an offer.
In 2024, the typical homeowner spent about $54,600 to sell their home, and realtor commission made up around 40% of that total cost.[2] Other expenses include closing costs, which can add another 2–3%.
3% commission calculator
Our calculator uses the national median home price and average commission rates to show how much you would pay in a typical transaction compared with a 3% listing agent.
You can adjust the home sale price to estimate your potential costs.
At the bottom of the calculator, you can also see how much you could save with a 1.5% listing agent. On a median-priced home, that lower rate means $4,673 in savings compared to a typical 3% commission. And since many 1.5% agents still offer full service, you could get the same level of support — just at a lower cost.
If you're interested in getting a lower commission rate, fill out this short quiz to get matched with the top agents in your area charging just 1.5%.
How much does a realtor make on a $500,000 sale?
Realtors typically make 2.5% or 3% on a home sale. Here's what that looks like for a $500,000 property:
| 2.5% commission | 3% commission | |
|---|---|---|
| Listing agent | $12,500 | $15,000 |
| Buyer's agent | $12,500 | $15,000 |
| Total commission rate | $25,000 | $30,000 |
While these figures represent gross earnings, agents typically split this income with their brokerage and pay taxes and business expenses out of their share.
You can estimate realtor fees for your home sale by using a real estate commission calculator. Just plug in your desired sale price and the average commission rate in your state.
How to avoid paying 3% commission
Most home sellers can bypass the traditional 3% listing commission by partnering with a low commission real estate broker. The leading firms in this space offer listing fees as low as 1.5% while still delivering the full range of services you'd expect from conventional realtors.
To reduce the usual 3% real estate commission without sacrificing quality and service, it's worth exploring the top low-commission companies. Choosing the right one is key to aligning with your goals and ensuring the best value in your real estate transaction.
Top low commission companies
Clever Real Estate is the best option for most sellers looking for an agent. The company matches you with multiple agents from local brokerages, including top brands like Keller Williams and RE/MAX. It offers a low 1.5% listing fee, no matter which agent you choose. All of Clever's agents are vetted top performers who offer full service.
Redfin is a reputable discount real estate brokerage, but watch out for high minimum fees. The company offers significant savings, particularly if you buy and sell with the brokerage. But some areas have high minimum fees, which can cut into your savings. Redfin's agents also work with a lot of clients, and they don’t always have time to provide as much hands-on service as you may need.
Ideal Agent is a solid option if you’re looking for a top agent, but it has limited agent selection. The company vets its realtors thoroughly. However, you might not get to choose who you work with. Ideal Agent usually has only one or two realtors in an area, and there’s no guarantee they’ll be the right fit for your sale. The 2% listing fee is lower than the traditional rate, but other brokerages, like Clever, offer even lower fees while still maintaining high-quality agents and service.
Why do real estate agents charge 3%?
Two key factors drove the traditional 3% commission model:
1. Relieve up-front costs for home sellers. Selling costs in real estate transactions include home staging, professional photography, and advertising. These expenses can add up quickly, creating a financial burden before the home even hits the market.
The 3% commission model helps sellers by deferring marketing and selling expenses until the home is sold. Agents cover these costs initially and are reimbursed through the commission at the sale's closing.
2. Provide agents with a reward for the risk they take. Agents take considerable risks, investing their time and resources into marketing and selling a property without a guaranteed paycheck. This risk includes the time spent and the costs incurred for marketing and advertising the property.
This model lets sellers pay their agent after the house sells. The 3% commission incentivizes realtors to invest in marketing the seller's home despite not guaranteeing payment.
Why do sellers pay the buyer's agent fee?
Home sellers usually pay the buyer's agent fee for a couple of reasons:
It decreases the out-of-pocket costs for the buyer. If buyers had to pay for their agent, many more people wouldn't be able to afford a home. Sellers covering the cost allows for a larger pool of potential buyers.
It incentivizes buyer's agents to show your property. Buyer's agents are more likely to point their clients to your listing if you offer a competitive buyer's agent commission. The agents know they'll get paid well if one of their clients purchases your property.
🏡 Real estate commission changes are here!
After losing a lawsuit over their practices in 2024, the National Association of Realtors agreed to change how real estate professionals do business.
As of August 2024, buyer's agents are required to sign an "agency agreement" before providing services to a buyer. This agreement has to specify what services the agent will provide, and how much they will get paid.
Real estate agents are no longer allowed to split commissions with one another. In the past, it was common for a listing agent to collect a 6% fee from the seller, and then split this fee with a buyer's agent who brought a buyer. Going forward, buyer's agents will have to negotiate their fee directly with the buyer they represent.
Learn more about how the real estate commission changes will impact buyers and sellers.
Note: Our survey of 1,000 Americans and over 300 realtors has found that about two-thirds of the general public (67%) support the commission changes resulting from the settlement — but 70% of realtors oppose them.
FAQ about real estate commission
What is a 3% commission realtor?
A 3% commission realtor charges a listing fee that aligns with the industry average. Traditionally, a standard listing fee was 3% or more of the home's sale price. These days, many agents charge a bit less — typically 2.5–3%. The national average listing fee is currently 2.82%.
But you don't have to pay a realtor 3%. You can get the same full service from agents who charge low commission rates — as low as 1.5%.
Is a 3% commission a lot?
A 3% commission has long been the industry standard. However, technology and innovation have made home selling more efficient, and 3% may no longer be a fair real estate commission. Most home sellers can find better value with a top, low-commission realtor who offers full service.
What percentage do most realtors charge?
In the U.S., traditional realtors charge 4–6% in total real estate commission. This commission is split between the listing agent and the buyer's agent. These rates can vary depending on your location. Learn more about real estate commission rates by state.
Do all realtors make 3%?
In the U.S., traditional realtors charge 4–6% in total real estate commission. This commission is split between the listing agent (who takes an average of 2.82% and the buyer's agent (who takes an average of 2.75%). These rates can vary depending on your location and other factors.
What is the lowest commission a realtor will take?
The lowest commission full-service realtors accept is usually 1.5% of a home's final sale price. This discount is significant compared to the average real estate commission of 2.5–3% that a traditional agent charges. The best way to pay less in realtor commissions is to work with a low commission real estate brokerage. Top companies offer listing fees as low as 1.5% and match you with the best local agents.
Can I get a 3% total real estate commission?
For most sellers, paying a 3% total commission is impossible, as it includes paying two agents. However, you can get close to this rate by listing your home with a low commission agent who charges a 1.5% listing fee and offers a 1.5–2% buyer's agent fee.
The best discount brokers have found ways to lower their listing fees with few (or no) customer service trade-offs, which makes them a great option for most people. However, whether offering a below-average buyer's agent fee makes sense depends on commission rate trends in your market and buyer demand in your local area.
