Selling a house is quite a stressful process (right up there with some of the most stressful events of one’s life), but it doesn’t have to be overly costly as well. So, before anything else, it’s important to know what to expect when it comes to costs. 


If you decide to work with a real estate agent (and you should), their commission is going to be one of the significant costs, so understanding agent commissions should be one of your main priorities. 


So, if you want to know just how much the commission is and what it covers, we put together a quick and helpful guide.  

How Much is the Real Estate Commission?

First of all, you should know that most real estate agents get paid by commission. They don’t charge a fee for the time they spend looking for buyers, negotiating price, and setting up the transaction (which can be quite a time-consuming and mentally-draining set of tasks). 


In general, the commission is a percentage of the selling price, once the transaction is confirmed. The actual percentage varies, depending on your location and current economical development of the area, but in most cases, it is around  5% to 6% of the final sale price. So, if the house sells for $200,000, the real estate agent’s commission would be $12,000. 


Sure, it may seem like a lot if you don’t know the amount of work that goes behind selling a house. Also, the agent doesn’t get the whole amount for personal use – they also have to pay taxes and other expenses. 

Why Am I Paying This Commission?

It’s important to mention that every homeowner has the option to sell their own home (the assistance of a real estate agent is not mandatory).


However, unless you are well-versed in the housing market, you may not have the necessary knowledge to make sure you set the right price and find buyers. A real estate agent doesn’t just post the house selling ad on a site and waits for buyers to pop up. They also provide assistance with pricing, promoting the house using various platforms, negotiations, and more. 


In addition, they may offer tips on things you can do to speed up the process (home improvements) and will know how to doll-up the property to look appealing. 


Lastly, the assistance of a professional who does all the leg work and knows the business translates into peace of mind for the homeowner. True, it won’t take all the stress away, but it does help to have a reliable business partner while going through this endeavor. 


And, according to NAR (National Association of Realtors), the typical house sold by the owner (without help from a real estate agent) usually sells with about $50,000 underprice. So, if you want top dollars for your property, it is worth considering paying the commission to a professional realtor.  

Wrap Up

When you first see the numbers, it can be easy to think that your real estate agent lives a life of luxury. However, you also need to factor in the fact that they don’t get paid unless the deal goes through, which can take months. And, during this time, your agent is hard at work trying to find a buyer and thinking promotion strategies. 


Overall, selling a house and making sure everyone benefits from it is a tough job!