1. What is a Realtor Commission?

A realtor commission is the fee paid to real estate agents for their services in facilitating a property sale. It's typically a percentage of the final sale price and is split between the buyer's and seller's agents.

2. How Commission is Calculated

The commission is calculated using the formula:

Where:

• Sale Price — The final selling price of the property
• Commission Rate — The agreed percentage rate (typically 5-6% in the US)

Example: For a $300,000 home with a 6% commission rate, the total commission would be $18,000.

3. Typical Commission Rates

Details: While commission rates are negotiable, standard rates in the US range from 5% to 6% of the sale price. This is typically split between the listing agent (2.5-3%) and buyer's agent (2.5-3%).

4. Using the Calculator

Tips: Enter the sale price of the property and the commission rate percentage. Both values must be positive numbers (sale price > 0, commission rate between 0-100).

5. Frequently Asked Questions (FAQ)

Q1: Are realtor commissions negotiable?
A: Yes, commission rates are always negotiable between the seller and their listing agent.

Q2: Who pays the realtor commission?
A: Typically the seller pays the full commission, which is then split between both agents.

Q3: What's the average commission rate?
A: In the US, the average is 5-6%, but this varies by market and property type.

Q4: Are there alternatives to percentage-based commissions?
A: Some agents offer flat-fee services or reduced rates for certain circumstances.

Q5: How is the commission split between agents?
A: The total commission is typically split 50/50 between the listing and buying agents, but this can vary.