1. What is Real Estate Commission?

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

2. How Commission is Calculated

The commission is calculated using this simple formula:

Where:

• \( Sale\ Price \) — The final selling price of the property
• \( Rate \) — The agreed commission percentage

Example: For a $500,000 home with a 5% commission rate, the total commission would be $25,000.

3. Typical Commission Rates

Details: While commission rates are negotiable, they typically range between 5-6% in the United States, with variations by region and market conditions.

4. Using the Calculator

Tips: Enter the sale price in USD and the commission rate as a percentage. Both values must be positive numbers (rate typically between 1-10%).

5. Frequently Asked Questions (FAQ)

Q1: Who pays the real estate commission?
A: Typically the seller pays the commission, which is then split between the listing agent and buyer's agent.

Q2: Are commission rates fixed?
A: No, commission rates are always negotiable between the seller and their agent.

Q3: What's included in the commission?
A: The commission covers agent services including marketing, showings, negotiations, and handling paperwork.

Q4: Can I avoid paying commission?
A: You can sell your home yourself (FSBO), but you'll need to handle all aspects of the sale.

Q5: How is commission split between agents?
A: Typically the total commission is split 50/50 between listing and buyer's agents, but this can vary.