How Much Do Realtors Charge to Sell a Home?

Your house isn’t just your home—it’s an investment that will hopefully pay off for you in the long run. As you build equity over the years and through home improvements, you’re also building the profit that you can expect when you sell your home. 

The price tag on your property, however, will be more than what ends up in your pocket. The single biggest cost that reduces your takeaway is usually the realtor commission, so let’s explore (1) how they work and (2) how you can lower them. 

What Are Realtor Fees and How Do They Work?

In any given home sale, you’ll typically see two real estate agents involved. These are: 

• Listing agent – Specialized salesperson who represents a seller throughout the process
• Buyer’s agent – Helps the potential buyer find, negotiate for, and close on a home purchase

While many agents professionally fulfill both roles, with some clients looking to buy and some engaged in a sale, they’ll usually act in only one role (representing one party) in a specific property sale. 

Residential real estate agents in the U.S. typically work on commission—that is, a percentage of the final sales price of a home. Who pays realtor fees often depends on the structure of the sale. Neither type of real estate agent is paid up front for representing the home buyers or sellers. Instead, they’re paid on closing day, often out of the sale proceeds.

Typical Realtor Commission Rates

How much do realtors charge to sell a home? Based on a September 2024 survey by Clever, average real estate commissions in the U.S. are¹: 

• 5.32% total commission
• 2.74% for the listing agent 
• 2.58% for the buyer's agent 

In dollars, that average would equal $13,300 for a 250,000 house, $23,940 for a $450,000 property, or $53,200 for a $1 million listing.

Remember, ”average” means that there are a range of different numbers behind those percentages. What you will specifically pay depends on factors including: 

• Listing price, with lower percentages for more expensive homes and vice versa
• Market conditions including housing supply, interest rates, and the state of the economy
• Level of service and agent experience
• Location, ranging from 5.86% total commission in Michigan to 3.51% in Nevada

How Are Realtor Fees Split Between Agents in 2024?

Historically, the commission has been split close to 50/50 between the listing agent and buyer agent, with some wheeling and dealing taking place directly between agents where allowed by state law. The ethics have been particularly slippery when it comes to advertising what commission split will be offered to a home buyer agent on MLS listings, thus leading them to steer their clients toward properties that benefit the agent. 

However, 2024 is a year with major changes in how realtor commission is handled. Several class-action lawsuits, the most recent against the National Association of Realtors (NAR), ended in settlements that included these new rules²:

• Home buyers must negotiate their own contract and commission rate with their agents
• Listing agents can no longer offer rate splits on MLS listings to attract buyers’ agents
• Buyers who want sellers to pay their agents’ commissions must seek it through purchase contract negotiations

The intended result is lower commission costs for everyone by requiring more transparency and splitting the shared commission into two separate commissions. 

How to Reduce Realtor Fees

How much a realtor charges to sell a house can vary depending on several factors. To keep your costs down: 

• Negotiate energetically
• Shop around and compare services
• Consider a discount listing service or a less extensive set of real estate agent services
• Showcase how easy your home will be to sell based on its condition and your efforts

Final Thoughts on Realtor Fees

While realtor fees can be daunting, you have options. Before you commit to a listing agent, investigate what you can use to negotiate a lower commission, the range of prices available based on service level, and whether an alternative home sale avenue could be a better fit for you. Failure to do this is one of the biggest mistakes when selling a home.

Truehold's sell and stay transaction is a unique way of bringing together two common transactions: a home sale and a rental lease. 

Unlike a traditional straight sale, Truehold’s sell and rent transaction allows you to sell your home and avoid the costs of upgrades and staging required for a typical sale process. Plus, Truehold covers property insurance, essential repairs, or property tax when you become a renter. 

With Truehold, you can cash out your home equity and use it to help fund retirement goals, business opportunities, aging-at-home modifications, and other needs. Instead of a mortgage payment, you’ll pay a competitively-priced rent to live in the home you love.*

Ready to learn more? Call us today, and a Truehold representative will contact you to discuss the details and determine whether a sell and stay transaction is a good fit for your goals and circumstances. 

Disclaimer*: After the home sale, you must comply with the terms of your lease to continue living in the home. This includes making timely payments on your rent for your minimum lease term (which ranges from 6 – 24 months). 

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Sources: 

1. Clever. Average Real Estate Agent Commission Rates (2024 Update). https://listwithclever.com/average-real-estate-commission-rate/‍
2. Urban Institute. Changing Real Estate Agent Fees Will Help All Buyers and Sellers but Will Help Some More Than Others. https://www.urban.org/urban-wire/changing-real-estate-agent-fees-will-help-all-buyers-and-sellers-will-help-some-more