How the calculation works
A commission is usually a percentage of the sale price, a flat fee, or a mix. The tool adds up two sides:
- Listing side: what the seller agrees to pay their own broker. As a percent, it is price × rate. As a tiered fee, the first part of the price uses one rate and anything above the breakpoint uses another. A flat fee is a fixed dollar amount.
- Buyer's agent side: what the buyer's broker earns under the buyer's written agreement. The seller can agree to pay it, the buyer can pay it, or they can split it.
total commission = listing side + buyer's agent side. The effective rate is the total divided by the price. For agents, take-home is each side times the share your brokerage lets you keep; the brokerage keeps the rest.
Worked example
A home sells for $600,000. The seller agreed to 2.5% for the listing broker and agreed to cover the buyer's agent at 2.5%. Both agents keep 70% of their side.
| Item | Math | Amount |
|---|---|---|
| Listing side | $600,000 × 2.5% | $15,000 |
| Buyer's agent side | $600,000 × 2.5% | $15,000 |
| Total commission | 5.0% of price | $30,000 |
| Listing agent take-home | $15,000 × 70% | $10,500 |
| Listing brokerage | $15,000 × 30% | $4,500 |
Change the listing fee to a tier of 3% on the first $500,000 and 1.5% above it, and the listing side becomes $15,000 + $1,500 = $16,500. If the buyer pays their own agent instead, the seller's cost drops to the listing side alone. Each quarter point on a $600,000 sale is $1,500.
What a buyer agreement must say
Under the NAR practice changes, a written agreement between a buyer and their agent must include:
- A specific, conspicuous disclosure of the amount or rate the agent will be paid, or how it will be determined.
- An objective amount (such as $0, a flat fee, a percent or an hourly rate) that is not open-ended.
- A term barring the agent from receiving more from any source than the amount agreed with the buyer.
- A conspicuous statement that broker fees and commissions are fully negotiable and not set by law.
That third point matters to sellers: if you offer more than the buyer agreed to pay their agent, the agent cannot collect the extra. Ask what the buyer's agreement says before you agree to a number.
Edge cases
- Concessions vs commission. A seller credit toward the buyer's closing costs is a concession, not a commission. Use the seller concessions calculator to check lender limits.
- Agent splits vary. Brokerages may use caps, flat desk fees or tiered splits. Enter your effective split to estimate take-home.
- Taxes. Commissions are selling expenses that reduce the seller's amount realized for capital gains purposes.
What to do next
See your full seller net sheet with the home sale proceeds calculator. Read real estate commissions after the NAR settlement, buyer broker agreements and listing agreement types before you sign.