1. What is Real Estate Commission?

Real estate commission is the fee paid to real estate agents or brokers for their services in facilitating a property sale. In California, this is typically a percentage of the final sale price and is negotiable between the seller and the agent.

2. How Commission is Calculated

The standard commission calculation formula is:

Where:

• Sale Price — Final selling price of the property
• Commission Rate — Agreed percentage between seller and agent

Example: For a $500,000 home with 5% commission, the calculation would be $500,000 × 0.05 = $25,000.

3. Typical Commission Rates in California

Details: While commission rates are negotiable, the typical range in California is 5-6% of the sale price. This is usually split between the listing agent and buyer's agent.

4. Using the Calculator

Tips: Enter the sale price of the property in USD and the commission rate as a percentage (typically between 5-6%). The calculator will instantly compute the total commission amount.

5. Frequently Asked Questions (FAQ)

Q1: Are commission rates fixed in California?
A: No, commission rates are always negotiable between the seller and the real estate agent or broker.

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: Is the commission rate the same for all price ranges?
A: Not necessarily. Some agents may offer lower rates for higher-priced properties.

Q4: Can I negotiate the commission rate?
A: Yes, commission rates are always negotiable in California. It's recommended to discuss this before signing a listing agreement.

Q5: Does the full commission go to my agent?
A: No, the total commission is typically split between the listing agent and buyer's agent, and each agent shares a portion with their brokerage.