1. What is Texas Real Estate Commission?

The real estate commission in Texas is typically paid by the seller at closing and is split between the buyer's and seller's agents. The standard total commission rate in Texas is around 5.64% of the sale price, usually split evenly (2.82% each).

2. How Commission is Calculated

The calculator uses the standard commission formula:

Where:

• \( Sale\ Price \) — The final selling price of the property
• \( Commission\ Rate \) — The agreed percentage (typically 5.64% total in Texas)

Explanation: The total commission is calculated as a percentage of the sale price, then typically split 50/50 between buyer's and seller's agents.

3. Typical Commission Rates in Texas

Details: While commission rates are negotiable, the standard in Texas is 5.64% total (2.82% to each agent). Rates may vary based on property type, market conditions, and brokerage agreements.

4. Using the Calculator

Tips: Enter the sale price of the property and the commission rate (default is set to 5.64%). The calculator will show total commission and the typical 50/50 split between agents.

5. Frequently Asked Questions (FAQ)

Q1: Who pays the real estate commission in Texas?
A: Typically the seller pays the full commission at closing, which is then split between both agents' brokerages.

Q2: Are commission rates fixed in Texas?
A: No, commission rates are always negotiable between the seller and their listing agent.

Q3: What's included in the commission?
A: The commission covers both agents' services, marketing costs, brokerage fees, and MLS fees.

Q4: Can commission rates vary by city?
A: Yes, rates may be slightly higher or lower in different Texas markets (e.g., Houston vs. Austin).

Q5: How is commission reported to the IRS?
A: Commission is reported as income to the agents' brokerages, not directly to individual agents.