1. What is Real Estate Commission?

Real estate commission is the fee paid to agents for facilitating a property sale. In New Jersey, this is typically a percentage of the final sale price, split between the buyer's and seller's agents.

2. How Commission is Calculated

The standard commission calculation formula is:

Where:

• Sale Price — Final selling price of the property
• Commission Rate — Agreed percentage (typically 5-6% in NJ)

Example: For a $500,000 home with 5% commission, the total commission would be $25,000.

3. New Jersey Commission Rates

Details: In New Jersey, commission rates are negotiable but typically range from 5% to 6% of the sale price. The rate may vary based on property type, market conditions, and brokerage.

4. Using the Calculator

Tips: Enter the property sale price in USD and the commission rate as a percentage (e.g., 5.5). The calculator will compute the total commission amount.

5. Frequently Asked Questions (FAQ)

Q1: Who pays the real estate commission in NJ?
A: Typically the seller pays the commission, which is then split between the listing and buyer's agents.

Q2: Is 6% commission standard in New Jersey?
A: While 5-6% is common, rates are negotiable and may be lower for higher-priced properties.

Q3: How is the commission split between agents?
A: The total commission is usually split 50/50 between listing and buyer's brokerages, then further split with individual agents.

Q4: Are there alternatives to percentage-based commissions?
A: Some brokers offer flat-fee or tiered commission structures, though percentage-based remains most common.

Q5: When is the commission paid?
A: Commission is paid at closing from the sale proceeds, after all fees and mortgages are settled.