calculate agent commission real estate los angeles

Commission Formula:

\[ \text{Commission} = \left(\frac{\text{Sale Price} \times \text{Total Commission Rate}}{100}\right) \times \frac{\text{Split Percentage}}{100} \]

Agent's Commission:

Total Commission:

Unit Converter ▲

Unit Converter ▼

From:	To:

1. Understanding Real Estate Commissions

In Los Angeles real estate transactions, commissions are typically paid by the seller and split between the listing and buyer's agents. This calculator helps agents estimate their share of the commission based on the sale price, total commission rate, and their split percentage with their brokerage.

2. How Commission is Calculated

The commission calculation follows this formula:

\[ \text{Agent Commission} = \left(\frac{\text{Sale Price} \times \text{Total Commission Rate}}{100}\right) \times \frac{\text{Split Percentage}}{100} \]

Where:

Sale Price — The final selling price of the property in USD
Total Commission Rate — The full commission percentage (typically 5-6% in LA)
Split Percentage — The agent's share of the commission (often 50-70% for newer agents)

3. Typical Commission Rates in LA

Market Standards: In Los Angeles, total commission rates typically range from 5% to 6% of the sale price, though they can vary. This is usually split evenly (2.5-3% each) between the listing and buyer's agents.

Agent Splits: Newer agents might receive 50-60% of their side's commission, while experienced agents may keep 70-100%, depending on their brokerage agreement.

4. Using This Calculator

Instructions: Enter the property's sale price in USD, the total commission rate (e.g., 5.5), and your personal split percentage with your brokerage (e.g., 60 for 60%). The calculator will show both the total commission and your share.

5. Frequently Asked Questions

Q1: Are commissions negotiable in Los Angeles?
A: Yes, commission rates are always negotiable between the seller and listing agent, though market standards do exist.

Q2: Who pays the commission in a real estate transaction?
A: Typically the seller pays the commission, which is deducted from the sale proceeds at closing.

Q3: How is the commission split between agents?
A: The total commission is usually split evenly between listing and buyer's agents, but this can vary.

Q4: Are there additional fees deducted from my commission?
A: Many brokerages charge additional fees (transaction fees, desk fees, etc.) that aren't reflected in this calculator.

Q5: What taxes apply to real estate commissions in California?
A: Commissions are subject to income tax, self-employment tax, and possibly state disability insurance.