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How Real Estate Commission Work: A Guide to Commission

As the real estate industry is growing daily in the same line, people are interested in joining this field. They join this field as sales executives, real estate agents, developers, etc.

In this blog, we will discuss how real estate commissions works.

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What is a real estate commission?

Real estate commission is a fee a real estate agent takes from the seller and buyer. This fee is based on a percentage of buying or selling price. It’s a profitable field in real estate—many real estate agents make money from the commission they earn.

The respective broker takes the commission from the seller in the property selling price, but the buyer pays the commission separately, not adjusting the buying price.

How do real estate commissions work?

Now we will discuss how real estate commissions work. Let’s take a look;

Brokers are paid via commission.

As we see, real estate agents are not paid according to hourly rates. Their commission is based on the proportion of the house selling price, and they are getting paid by the seller or buyer. He receives this commission for facilitating the buyer and seller.

Agent Duties

Seller agents and buyer agents have different responsibilities they perform. For example, if you are a seller agent, you have to stage the house, market it, and set to open houses.

On the other hand, if you are working for a buyer, your responsibilities will be different from those of a seller’s agent. So you must be aware of purchasing property and should have all the information, home inspection, coordination with property lawyers, and the negotiating price you need during selling or buying a house.

Split the commission

When a house goes for sale, this is the time when buyers and sellers split the commission with their agents. The commissions eventuate from the sale amount, and the buyers are technically responsible for the amount.

How much are real estate commissions

Usually, a real estate agent’s commission is negotiable, but its percentage is mostly six or seven on the sales. Not only this, but the commission also depends on location and price.


To sum up the whole conversation, for those who want to become real estate agents, it’s a guide to know how they can earn massive commissions by staying in this field.

Moreover, the main thing to keep in mind, they can get a huge commission from the sale if they pay services as agent for the seller. And the commission percentage depends on the sale price. So the real estate agent’s services differ when he works for the seller or the buyer.

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