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Realtor Fees in California (All Your Questions Answered)

Selling your house in California comes with a set of fees you want to know about ahead of time. A majority of those expenses are realtor fees. Find out all of the costs of selling your house in California and how you can save money while getting the most for your house.
Realtor Fees in California (All Your Questions Answered)

If you're selling your house in California, your goal should be to get the best price and keep as much of the profits as possible. But sellers face costs that impact the equity you walk away from the sale with.

The biggest cost for sellers in California are traditional realtor fees of 6%.

Working with the right low-commission real estate agent can help you save up to 50% on realtor fees without sacrificing the service you receive.

> Learn how much money you can save.

To get a better picture of what it costs to sell your home in California, let's walk through all of the costs you may run across and discuss ways you can save money while getting the best price for your house.

What realtor fees are there in California?

Sellers pay realtors a percentage of their home's sales price when the deal closes. While realtor's commissions in California can vary depending upon location and the type of property for sale, the average real estate commission rate in California is approximately 6%.

The realtor fees are taken from the proceeds of the sale of the house and then split between the seller agent and the buyer agent. For example, a $400,000 house would net $24,000 in total realtor fees with each agent taking $12,000 on the sale.

Who pays realtor fees in California?

The seller traditionally pays the realtor fees in California. The fees are paid during the closing process of the real estate transaction and are taken from the money the buyer pays for the house.

But savvy sellers will try to prepare for this ahead of time by rolling realtor fees into the sales price of the house to offset their costs. So, indirectly at least, the buyer could end up paying for realtor fees.

What other fees do sellers pay in California?

Other than realtor fees, sellers in California have additional closing costs, which vary depending on the county and city you live in and the circumstances of the sale.

Common fees in California can include a termite inspection fee and a natural hazard disclosure report fee. Other fees that may apply are escrow fees, mortgage balance payoff fees, city or county transfer fees, notary fees, homeowners association (HOA) transfer fees, home warranty fees, and lien release document fees if there is a lienholder on the title.

Including realtor fees, California sellers can expect to pay 6%-10% of their home's selling price. However, some sellers will agree to cover some of the buyer's closing costs during negotiations of the sale through seller concessions. Seller concessions, or seller assist, can increase a seller's fees at closing up to about 3% more of the purchase price of the house.

3 Ways to Save on Realtor Fees in California

FSBO

If you decide to sell your house without an agent, you won't have to pay for a listing agent in California. But selling your house “For Sale By Owner” (FSBO) comes with its own risks. It's imperative that you have certain skill sets and know what you are doing if you decide to take this route.

Pros

  • No listing agent commission
  • Seller is in charge of the sale
  • You can gain experience in selling real estate on your own

Cons

  • Requires time, commitment, and due diligence
  • Still have to pay buyer's agent commission
  • Difficult to properly screen potential buyers
  • Requires extensive marketing and negotiating skills
  • FSBO websites have limited scope
  • Will have to pay to have house listed on MLS for buyer's agents to see it
  • Easy to price the house incorrectly
  • Can leave a lot of profit on the table

Discount Brokerages

Discount brokerages can save you some money on realtor fees, especially if you are clear about what services you want and what services you don't. If you use a discount brokerage that sells services à la carte make sure you know exactly what you are paying for. Read the contract very carefully.

Some, discount brokerages provide a much lower quality of expertise and service than traditional full-service agents because their business model requires high client loads and in-house transactional agents that work to scale for quantity rather than quality. This could result in a lower sales price that wipes out any money saved on realtor commissions.

Pros

  • Lower overall cost
  • MLS listing
  • Sellers can pick and choose services

Cons

  • Limited service
  • Less flexibility in contracts
  • Discount brokerages attract newer agents and agents who may not have the expertise to make it as traditional realtors

Low-Commission, Full-Service Agents

When you use a full-service, low-commission agent, you get all of the perks of a traditional agent without the high commission fees. You'll want to spend a fair bit of time vetting agents to find a top-notch agent in your area with excellent client testimonials.

Pros

  • Save thousands in commission
  • Get the same full-service expected of traditional agents
  • Higher offers are more likely

Cons

  • Takes time and research to weed out low performing agents from top agents

If you're selling a home in California and looking to save on realtor commission, Clever can help. Clever partners with top-rated realtors across California from major brands like Keller Williams, RE/MAX, Coldwell Banker, and more.

Clever has already done the research for you and carefully vetted agents based on their performance and experience. Plus we've pre-negotiated a lower listing commission of $3,000 or 1% on homes over $350,000. That saves you time and money while getting you a full-service agent.

Get connected with a top agent in your area.

FAQs About Realtor Fees in California

What is a typical realtor commission?

A typical realtor commission is 6% of the sales price of the house. The seller pays the commission to their agent during closing. The seller agent then splits the commission with the buyer's agent so both agents walk away with 3% commission.

Are real estate commissions negotiable in California?

Real estate commissions are negotiable in California. However, some realtors are less likely to negotiate with you. Realtors must work with a brokerage and split their commissions with their broker.

If their brokerage demands that they bring in a certain percentage per sale or takes a high percentage of the cut, a realtor may not be able to lower their fee for you.

Also, remember that you want a realtor who is a good negotiator to get the best price for your house. If a realtor agrees to a lower rate without a fight, that should be a red flag.

How are realtor fees calculated?

Realtor fees are calculated based upon the percentage of the sale a realtor charges for their services. In California, traditional realtor fees are 6%. For example, if a house sells for $500,000, realtor fees would be $30,000.

That $30,000 is taken from the seller's proceeds of the sale. Then the seller agent splits it with the buyer agent. So each agent nets $15,000 on the sale of a $500,000 house. Then each agent has to give their brokerage a cut.

Who pays escrow fees in California?

Exactly who pays the escrow fees in California depends on which county your property's in.

In some counties in California, the buyer pays the escrow fees while in others the buyer and seller split the escrow fees. Check the laws in your county.

A rough estimate of escrow fees is $2.00 for every $1,000 of the sales price. Escrow is a neutral third party that oversees the transfer of the money, the title, and other necessary documents required to close a real estate transaction. Escrow protects both the buyer and the seller while money and property exchange hands.

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Andrew Schmeerbauch
Andrew Schmeerbauch

Andrew Schmeerbauch is the Director of Marketing at Clever Real Estate, the free online service that connects you top agents to save on commission. His focus is educating home buyers and sellers on navigating the complex world of real estate with confidence and ease. Andrew has worked on projects for the United Nations and USC and has a particular passion for investing and finance. Andrew's writing has been featured in Mashvisor, L&T, Ideal REI, and Rentometer.

See all Andrew's Posts
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