Both the buyer and the seller can negotiate who will pay the real estate agent’s fees. Previously, sellers usually made decisions. Other expenses can also be negotiated, such as closure fees and HOA fees. Fees and fees vary depending on the home price, loan type, and closing costs negotiate.
Do you sell your house? Then, “Who will pay the real estate agent?” Traditionally, this cost has been carried by sellers, but recent changes have changed the industry.
Last year, the National Association of Realtors (NAR) and multiple listing services (MLS) implemented new rules on how real estate agents communicate about real estate rates. These changes took effect in August 2024 and are intended to increase pricing transparency and competition.
In this Redfin article, you will learn everything you need to know about real estate agents, agents fees, agent fees, and how changes affect buyers and sellers.
Are you thinking about selling it?
Lock the competitiveness of your next home.
What is the Real Estate Board?
A Real Estate Board (or Fees) is the payment that a home buyer or seller makes to an agent for service to assist in the purchase or sale of a home. Commissions are often a percentage of the final home sale price and are exchanged during the final transaction at the time of closing.
Who pays the real estate agent’s fees?
Buyers and sellers can negotiate who will pay the Real Estate Agents Board fee. Prior to the 2024 NAR settlement, sellers typically paid both the buyer and the seller’s agent from revenue from sales. But now the buyer agrees in writing to the agent’s fees prior to the tour. The buyer may ask the seller to cover the buyer’s agent fee when the buyer makes an offer.
Due to this change, the amount that a seller must pay the buyer’s agent will vary from buyer to buyer. Redfin expects sellers to continue to cover buyer agent committee fees in many transactions, but increasingly these fees will be negotiated as part of the offer.
Below are two options as to how sellers navigate the new committee process:
Sellers can leave it freely and ask the buyer to make the best offer. Sellers can actively provide fees or concessions that buyers can use to pay agents as part of their home marketing strategy. If a buyer’s agent contacts a listing agent to schedule a show, he or she can tell the buyer and the agent.
Can I negotiate a committee of real estate agents?
Yes, you can negotiate the real estate agent’s fees. Fees are not set by law and are completely negotiable. Commissions are often different from region to region, with no law or industry rules setting committee fees.
Why do sellers pay to the buyer’s agent committee?
Sellers offered to cover the Buyers Agent Committee as a way to attract more buyers and encourage sales. Sellers are no longer able to promote this “sales committee” in MLS in most markets (called sales office committees), but the committee can still negotiate. Additionally, the seller may choose to provide some form of economic incentive to the buyer.
Instead of providing the committee directly, the seller may provide concessions that the buyer can use appropriately, such as closure fees, agent fees, or anything else. Alternatively, the seller can tell the agent that the agent is open to negotiations, asking the buyer to make a concession or covering the agent’s fees themselves.
Ultimately, whether and how a seller contributes to the buyer’s costs is now a negotiable part of the transaction.
Who will pay the closure fee?
Commissions are usually just one of the costs associated with buying a home. Other fees will be bundled together at closing costs.
Buyers and sellers are free to negotiate the closing costs, but on average, sellers usually pay between 6% and 10% of the selling price at closing costs, while buyers pay 2%-5% of the selling price. However, these costs vary greatly depending on the type of loan. Typical closure costs are:
Title and Escrow Fees: These cover the legal aspects of transferring escrow services that hold funds until the conditions are met. Loan Cost: This includes origination, underwriting, and other lender fees that come with your mortgage. Home inspection and rating: Usually, when the buyer pays, these costs check the condition of the property and market value. Transfer Tax: State or local governments usually charge excise taxes to transfer ownership, with the exception.
Homeowner’s Association Fees: HOA properties may require pro-rated membership fees and transfer or initiation fees upon closing.
How NAR Settlement affected agent fees and fees
Before the NAR settlement, the sellers would normally advertise a committee that would be willing to provide to the buyer’s agent on MLS, allowing the agents to see this amount in advance. This often influenced the decision-making of buyers’ agents. Some MLSS have requested that the list provide a fee to the buyer’s agents. Commissions were always negotiable, but in reality they were rarely negotiated. After the settlement, more buyers and sellers are negotiating committee fees.
The NAR settlement has also established rules designed to help make real estate fees more transparent and competitive. For example, an agent must provide a written contract to the home buyer who explains the price before the tour. These agreements should also include a statement that all committees are fully negotiable.
Some brokerage companies require a full buyer’s agency agreement that commits customers to that agent only before the tour. Redfin isn’t. Redfin believes it should attract customers’ business. This is why Redfin discloses our fees in advance, but does not require customers to exclusively commit to their homes.
Unless otherwise specified by state law, buyers do not need to sign an exclusive, binding contract to tour the home.
Regarding the committee, how does Redfin differ?
At Redfin, we have always believed that consumers should do the best deal. So you charge the seller a 1% lower listing fee. *
Our fees when serving buyers vary by market, but we are competitive because we know that we can make a difference in losing your victory or offer. All things equal, sellers prioritize offers that they ask to pay lower buyer agents’ fees.
We also offer additional savings to buyers who promise to hire us after our first tour. With the Sign & Save program, you will reduce your fees by 0.25% if you promise to hire a Redfin agent before your second tour. We are acquiring our customers’ business by providing the best service and value.
Final thoughts
The commission and fees were always negotiable, but before the NAR Commission’s case, the seller and his agent made the majority decision. Currently, both the buyer and the seller must sign a listing agreement with the agent explaining the rate of the fee. This shift will increase transparency and flexibility for buyers and sellers. This is a goal Redfin has always supported.
Understand whether you are looking for a dream home, about to move, who will pay the real estate agent and how it will affect you.
You can learn more about the NAR settlement here and how Redfin has embraced this change and has defended better deals for its customers here. You can also connect with a Redfin agent to learn everything you need to know, whether you’re buying or selling.
NAR payments apply primarily to MLS listings, and MLS rules may differ. Rules regarding lists rather than MLS vary widely from state to state. Talk to your agent to learn more.
*Listing fees are subject to change and the minimum value applies. Sellers do not include the agent fees of buyers who choose to cover the buyers. Listing fees increased by 1% of the selling price if the buyer was not represented. Please sell at a 1% listing fee only if you purchase from Redfin within 365 days of closing your Redfin listing. We will charge you a 1.5% listing fee and after purchasing your next home, we will send you a 0.5% difference check. Click here for details.
