What is Berkshire Hathaway's Commission in 2021?

Andrew Whytock

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Andrew Whytock

October 21st, 2021
Updated October 21st, 2021

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Berkshire Hathaway fees | Commission splitting | Royalty fees | Do agents get a salary? | Negotiating with Berkshire Hathaway agents | FAQs

Berkshire Hathaway HomeServices is one of the largest luxury real estate brokers in the country with over 45,000 agents. These agents work entirely on commissions which they split with their brokers.

There’s no set commission that applies to all Berkshire Hathaway real estate agents because brokers don’t set these rates — agents negotiate them with their clients.

In a typical real estate transaction, realtor fees are generally between five and six percent of the purchase price of a home.

These fees are usually split between the buyer’s agent and their broker and the seller’s agent and their broker.

Because the fee gets split several ways, some agents with Berkshire Hathaway will have higher commissions than others. The fee that you pay will depend on what’s negotiated in your listing or purchase agreement — the contract that you sign with your agent.

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How do Berkshire Hathaway fees work?

Berkshire Hathaway agents charge a commission for their services — just like agents with any other broker. This commission is a set percentage of the purchase price, but it isn’t set by the broker.

The amount that the agent charges is up to them; they just have to give a cut to Berkshire Hathaway.

That’s why there is no universal Berkshire Hathaway realtor fee — because the fee that you pay can be negotiated directly with your agent before you sign your listing agreement.

Your Berkshire Hathaway agent won’t get paid until the deal closes, regardless of how much they charge you for their services.

Realtor fees typically range from 5-6%, with half being paid to the buyer’s agent and their broker, and the other half being paid to the seller’s agent and their broker.

» MORE: What is realtor commission?

What is Berkshire Hathaway’s commission split?

Some sources list Berkshire Hathaway’s starting commission split at 60/40, with 60% of the commission from a sale going to the agent and 40% going to the brokerage. However, the commission structure could vary depending on the broker.

So why would an agent give up 40% of their commission?

Most individual realtors are only able to close deals by partnering with a brokerage, like Berkshire Hathaway, as they are legally required to work under a licensed broker.

In addition to overseeing deals, there are additional perks that brokers typically offer their agents. Realtors working under a brokerage often get access to marketing materials, tech tools, sales resources, and even office space in some cases.

Because of this, commission splitting is a standard practice in real estate that allows both parties to share in the profits of a sale.

So if a Berkshire Hathaway agent sold a home for $500,000 with a 5% realtor fee ($30,000), half ($15,000) would go to the buyer’s agent and their broker, they'd keep $9,000, and pass $6,000 on to Berkshire Hathaway.

In other words, your agent's take-home pay on the sale of a $500,000 house would be $9,000.

Experienced Berkshire Hathaway agents with high sales volumes can negotiate more favorable splits of 80/20 or even 90/10 in some cases.

Ultimately, the commission split is negotiated between the agent and the broker, and it may be affected by other factors like the region where the broker is located.

» LEARN: How do realtors get paid?

Royalty fees

Berkshire Hathaway charges an on-going 6-7% royalty fee on profits. This is typical since most major franchises charge a fee to their brokers, and it is the responsibility of the broker to collect and pay this fee.

The franchise fee is usually deducted from the commission before it is split between the broker and the agent.

For example, if the amount to be split is $10,000, $700 (7%) would be deducted for the royalty fee and the remaining $9,300 will be split between the broker and the agent.

Do Berkshire Hathaway agents make a base salary?

No — Berkshire Hathaway agents get paid entirely by commission. This can be a serious motivator for agents who have confidence in their ability to sell.

Because Berkshire Hathaway specializes in luxury real estate, the amount that agents could potentially earn from their commissions is much higher than it would be if they were selling starter or middle class homes.

Berkshire Hathaway doesn’t deal exclusively with high-end property, but it does make up the bulk of their business.

Can you negotiate with Berkshire Hathaway agents?

Yes! You can always negotiate with an agent when buying or selling a home, no matter what broker they’re with. Granted, some agents aren’t open to negotiating.

An agent might be reluctant to give you a discount on their standard rate because they’ll make less money. On the other hand, they might lose your business if they don’t.

If you’re going to negotiate, make sure you do so before signing a listing agreement. Once the listing agreement is signed, you’re locked into those exact terms with your agent.

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How to negotiate with an agent

When you’re negotiating with an agent, there are a few tactics that you can employ to get the best possible deal:

  • Leverage a seller’s market: If you’re listing a house in a market that’s moving quickly, you’re probably going to be able to sell in a matter of days. Point out to your agent that your listing will give them a fast sale. This might incentivize them to give you a better deal.

  • Identify services that you don’t need from your agent: Some agents offer a range of additional services, like staging and mail outs. If you don’t need these services, you shouldn’t have to pay the agent their usual commission.

  • Get multiple quotes: It always pays to shop around. Compare quotes from agents in your area to find out who will give you the best rate.

» MORE: Negotiating Realtor Commission.

FAQs

How much do Berkshire Hathaway real estate agents make?

It depends on the fee that they charge to customers, what their commission split with their broker is, and what market they’re in.

Berkshire Hathaway agents generally start out with something along the lines of a 60/40 commission split, meaning that they keep 60% of their commission and pass the other 40% along to the Berkshire Hathaway broker.

This split can change over time and become more favorable for the agent if their sales increase and they gain more experience.

Is Berkshire Hathaway good for new agents?

While Berkshire Hathaway has a favorable starting commission split of 60/40 for new agents, it can be difficult selling luxury real estate with little to no experience.

Agents with other brokers may make less money per sale, but they’ll be in a better position to learn the ins and outs of the complicated real estate transaction process before jumping into a specialized form of real estate.

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