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Who pays the Real Estate Commission?

Posted by: raindrop 8 years ago


A common question that I get is, "Who pays the realtor?"  Realtors work off of commissions, which is a percentage of the sales price.

The commission for a given property is set by the Seller and the Listing Agent.  A Listing Agent is the agent who has the house for sale.  When the Seller and Listing Agent are negotiating their contract to list a property, they agree upon the commission.

This commission is split between the Listing and Selling (Buyer's) agent.  Most of the time it's a 50/50 split, but sometimes it is not!  Regardless of the commission split, it is non-negotiable between the Listing and Selling Agent.

In other words, if a property is listed for sale, there is an advertised commission in the MLS for the Selling Agent.  A Selling Agent cannot bring an offer to the Listing Agent and Seller and then try to negotiate the commission. Further, Sellers cannot negotiate the commission once an offer has been submitted in an effort to save them money.

On the contrary, commission are negotiable between the Listing Agent and the Seller when they originally sign the listing agreement.  Once the listing agreement has been signed, the commission is non-negotiable.  If an agent ever tells you, as a Seller, that they have a set commission, you can tell them that set commissions are a violation of anti-trust laws.

With that said, there are occasionally circumstances where an agent offers to deduct their commission for a sale.  For example, with Coronado Island Realty listings, we offer to reduce our commission by 1% if we represent both the Buyer and Seller.  That saves the Seller money, which makes them happy!  We write this into our contracts so that it's clear from the beginning.

If you have any other questions about commissions and/or selling your home, contact Kate Gillingham at (619) 435-0145 or




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