The once-standard 6% commission in home sales is becoming a thing of the past. Our research shows that the current average commission rate nationwide is 5.32% — expected to decline further due to the NAR settlement on August 17, 2024.
Experts predict that the settlement changes will lower buyer's agent commissions and give buyers more negotiating power based on their needed services. Clever's CEO, Luke Babich, expects the average buyer's agent commission to drop from 2.58% to 1.5-2%, reducing the total national average to about 4.5%.
Recent Redfin data supports this trend, showing the average buyer’s agent commission for homes sold in October was 2.34%, down from 2.35% in August and 2.45% a year ago.[1]
However, real estate investor and licensed agent Megaan Pelaar notes that overall commission rates have stayed steady. "We may eventually see buyers paying their own agents, especially at higher price points, but sellers will likely still need to offer concessions in the first-time buyer market."
There are already ways to pay significantly less than 6%, too. Sellers can take advantage of discount agent services, like those offered by Clever Real Estate, which can reduce listing commissions by nearly half.
Pay less than 6% today
The easiest way to cut your commission rate is to use Clever Real Estate. Clever connects you with top-rated agents who offer a low 1.5% listing fee—far less than the nationwide average of 2.74%—potentially saving you thousands in commissions.
Choose Clever to keep more cash in your pocket and get full-service representation at a fraction of the cost.
⚡ Answer these five simple questions to get matched with local agents who work for a 1.5% listing fee
What is 6% real estate commission?
6% commission rate example
| Fee | Cost |
|---|---|
| Listing fee (3%) | $15,000 |
| Buyer's agent fee (3%) | $15,000 |
| Total 6% commission cost | $30,000 |
A 6% real estate commission is the total amount a home seller pays in realtor fees, typically split between the listing agent and the buyer's agent.
This means the seller pays around 3% to the listing agent who markets the property and 3% to the buyer's agent who brings in the purchaser, and the fee is calculated based on the home's final sale price.
For example, selling your home for $500,000 at a 6% commission rate would result in paying $30,000 in commission ($15,000 for the listing agent and $15,000 for the buyer's agent).
Do I have to pay 6%? NAR lawsuit update
The traditional 6% commission rate, long considered the industry standard, is no longer a given following the recent NAR lawsuit settlement. Historically, sellers were responsible for paying both the listing agent and the buyer's agent, typically amounting to 5-6% of the sale price, with a national average of 5.32%.
However, new regulations change how commissions are handled, potentially reducing costs for sellers and increasing transparency in the process.
Under the new rules no in effect:
- Buyers and their agents discuss commissions upfront. Buyer's agents must now secure an agency agreement specifying services and fees before taking on clients.
- No requirement for sellers to offer a buyer's agent fee. Sellers are no longer obligated to advertise a commission for the buyer’s agent. As a result, the buyer's agent may negotiate for their client to pay the commission, shifting the cost away from the seller.
- Commissions are another point in negotiations. Buyer’s agent fees can be negotiated within the purchase offer, which means sellers may end up covering only part or even none of the buyer's agent commission.[2]
These changes give buyers and sellers more control over commission costs, which many experts believe will lead to lower overall rates.
However, some predict that commission structures may eventually revert to familiar patterns, just with more documentation and transparency. "Eventually, we will land back where we are with sellers paying buyer's agent commission but with more documents and disclosures to complete," explains Kristyn Grewell, a real estate professional based in Edmond, OK.
Grewell notes that buyers might start paying their agents in higher price ranges. However, sellers will likely need to offer some concessions in the first-time buyer market. "This segment will be most affected," she says.
Education for buyers is going to be more important than ever with the new settlement, says Pelaar.
📈 Will the NAR settlement changes boost home values?
Some experts argue that the NAR settlement may increase home prices, even as real estate commissions decrease.
The argument is that lower commission fees might reduce transaction costs, but they can also raise a home’s resale value, similar to a tax cut on resale items.
Research from Kellogg Insight shows that while sellers benefit from lower fees and potentially higher sale prices, affordability could decrease for some buyers. Buyer’s agents, in particular, may need to adapt by clearly showcasing their value and exploring new service options.[3]
Should I use an agent who charges 6%?
Record-high home prices and tight inventory mean agents can earn a substantial paycheck quickly. This arguably reduces the need for agents to charge the full 6% and allows for more flexibility in commission rates.
However, commission rates vary widely based on location, home value, the real estate agency, market trends, and other factors. In some cases, hiring an agent who charges a 6% total commission may be practical.
For example, paying 6% might be worthwhile if:
- You find a top local agent who offers full service and hands-on support throughout your home sale, and they have a strong track record.
- The agent provides extra marketing efforts, including open houses, social media promotions, 3D tours, and aerial photography, to help your home quicker and for more money.
- The agent's commission covers the cost of home staging or other additional services that would cost you thousands of dollars.
- Agreeing to cover the buyer's agent fee in full creates better negotiations and flexibility between you, the buyer, and their agent.
- The agent helps you secure a sale price that exceeds your expectations, offsetting the added commission cost.
Let's say you're selling a home valued at around $500,000 and can choose between Agent A, who charges a listing fee of 3%, and Agent B, who charges 1.5%.
- Agent A secures a full-price offer of $500,000;
- Agent B's 1.5% fee gets you a below-list price offer of $490,000.
| Agent A | |
|---|---|
| Listing fee | 3% |
| Offer secured | $500,000 |
| Net proceeds | $485,000 |
| Agent B | |
|---|---|
| Listing fee | 1.5% |
| Offer secured | $490,000 |
| Net proceeds | $482,650 |
In this example, it's worth paying the higher commission, as you'd still earn $2,350 more with the higher-cost agent. Despite the higher commission rate, the first agent’s ability to secure a stronger offer results in more money in your pocket.
Remember that this 6% rate assumes you're responsible for the buyer's agent fee. Under the NAR settlement, you might not have to pay this fee, or you could perhaps negotiate to pay only part of it. For example, this could lower your total commission to 3-4% instead of 6%.
However, opting not to pay the buyer's agent fee could lead to tougher negotiations on other aspects of the sale, such as the final sale price, repairs, or closing costs. Buyers may seek these other concessions to offset the added cost on their end. It's best to consult with a local realtor for more market-specific advice.
Understanding realtor commission splits
A 6% commission rate may seem like overpaying, but remember that each agent doesn't keep the entire amount. Realtors have various expenses and split commissions with their brokerages.
For example, on a $500,000 sale with a 3% commission, an agent with a 50/50 split with their broker might only take home $7,500.
Grewell explains that commission splits can vary widely, with agents at national brands often sharing more with the brokerage than local boutiques.
For example, the nationwide brand Anywhere Real Estate, which includes brands like CENTURY 21® and Coldwell Banker®, reported an 80% commission split in its most recent public filing.[4]
"Splits can range from a flat fee of a few hundred dollars to 50% or more," says Grewell. "High-producing agents typically get better splits, while new agents share more with the brokerage. There's often a cap where once an agent reaches a certain production amount, they keep the full commission."
I can relate to this from my own experience as a former agent. Initially, my commission splits were 30% for me and 70% for my brokerage. As I reached higher sales volumes, these splits improved to 50/50 and eventually to 70/30 in my favor.
💸 What do realtors actually earn?
From my experience, it's common not to earn any money within the first 6-12 months of starting. Only in your second or third year do you start making enough money to support yourself. It takes a long time to build up your business, gain referrals from past clients, and learn the ins and outs of the industry.
So, it's not surprising to learn that most realtors (68%) earn less than $100,000 annually, with nearly half (47%) earning less than $50,000.[5] Meanwhile, the Bureau of Labor Statistics reports an average annual income of about $70,000 for real estate agents,[6] roughly in line with my second-year earnings as a full-time agent.
Most people think realtors deserve to earn more. One recent study found that over three-quarters of Americans think real estate agents should earn at least as much in commission as they do now, with nearly half believing agents should earn even more.[7]
So, most consumers value paying for a quality realtor, even if they want to reduce their commission costs.
Yet, commission remains a massive expense for sellers. In 2024, the typical homeowner spends around $55,000 to sell their home, with commission accounting for just under $22,000, or approximately 40% of the total costs.[8]
How to pay less than 6%
- Work with a company that offers built-in savings
- Negotiate with your agent
- Sell your home for sale by owner (FSBO)
Thankfully, there are ways to pay much less than 6% currently, while still getting full-service support from a top-rated realtor.
1. Work with a low commission realtor
The most reliable way to save money on realtor fees is to work with a real estate brokerage that offers built-in savings. The best low commission realtors offer discounted listing fees in exchange for full service and support from a high-quality realtor.
For example, Clever Real Estate offers a low 1.5% listing fee and matches you with top, full-service realtors in your area.
On a median-priced home sale of $357,469, you'd save $6,220 with Clever compared to what you'd pay with an agent charging the national average rate of 5.32%!
Clever is also backed by strong customer ratings, with over 3,000 5-star reviews on TrustPilot, and since its inception, more than 23,000 customers have sold or bought a home using Clever's agents.
Why pay more in commission fees for less service? Clever offers you bigger savings without sacrificing the service you expect from a traditional realtor.
With Clever:
✅ You'll only pay 1.5% to list your home
✅ You'll work with a full-service realtor from a top broker
✅ It's free, with zero obligation — you can walk away at any time
Saving on realtor fees doesn't have to mean sacrificing service. Find a top local agent today!
2. Negotiate realtor commission
Real estate commissions are technically always negotiable, and it's worth it to try negotiating a lower rate. Even a 1% difference can save you thousands in commissions.
That said, your realtor may not be willing to budge on commission — especially if your home is less expensive than the area average or comparable homes in your area are selling slowly.
Negotiating with an industry professional can also be challenging. One study found that only 22% of home sellers discussed commissions and successfully negotiated a lower rate with their agents.[9]
In addition, many realtors work for brokerages with set minimum commission requirements, so your agent may be unable to lower their rate.
» MORE: How to negotiate realtor fees
3. Sell your home for sale by owner (FSBO)
You can avoid paying a listing fee by selling your home without an agent, but this means you'll handle the entire sale process yourself. This includes setting a listing price, marketing to potential buyers, and navigating negotiations and closing. Essentially, you’re giving yourself a new job that may or may not pay well when all is said and done.
While the potential savings are real, there are several risks involved with selling FSBO homes. Statistics show that homes sold by owners typically sell for nearly $50,000 less than those sold with the help of an agent.[10] Unsurprisingly, 89% of buyers and sellers used an agent in their transactions, indicating a high reliance on professional assistance.[11]
» MORE: How to sell your house without a realtor
