This is how an agent’s commission rate is typically divided between parties.
Generally, people don’t quite understand how Realtors get paid. Today I’d like to quickly break down how the system typically works and how agents make their income.
“In most cases, the listing agent actually makes less money than the buyer’s agent.”
Agents work under brokerages—mine is called Keller Williams Realty Premier Partners. When I list a property at a 5% or 6% commission rate, I don’t get the entire percentage. Instead, it’s split up between me, my broker, the buyer’s agent, and their broker. So if we used a 5% rate, my side would get 2.5% and the buyer’s side would get the other 2.5%. However, this changes if I represent both the buyer and seller at the same time (which is rare), or if the buyer or seller’s agent is a broker.
In most cases, the listing agent actually makes less money than the buyer’s agent. For example, I pay for professional photos, marketing, and more when I list a home, but buyers don’t have to worry about any of these things.
I hope this helped give you an idea of where the commission rate usually goes. If you have any questions or are thinking about buying or selling a home, don’t hesitate to reach out to me. I look forward to hearing from you soon.
