How to Negotiate Real Estate Agent Commission

After the NAR settlement of 2024, agent commissions are more negotiable than ever. The old standard of 6% is no longer a given, and savvy sellers are saving thousands by understanding how and when to negotiate.

The Post-Settlement Landscape

The 2024 NAR settlement fundamentally changed how commissions work. Buyer's agent compensation is no longer guaranteed through the MLS, and sellers have more flexibility in how they structure their commission agreements.

Negotiation Strategies

1. Interview Multiple Agents

Get proposals from at least three agents. This gives you leverage and insight into what competitive rates look like in your market.

2. Know Your Market's Average

Commission rates vary by market. In competitive areas with high home values, rates are often lower. Rural areas with lower home values may have higher percentage rates.

3. Offer Incentives Instead of Higher Commissions

Consider a tiered structure: base commission plus a bonus if the agent sells above a certain price. This aligns incentives.

4. Negotiate the Buyer's Agent Portion

Post-settlement, you have more control over what (if anything) you offer buyer's agents. A lower buyer's agent commission can save 0.5-1% but may reduce your buyer pool.

5. Consider the Full Package

A slightly higher commission with a skilled agent who achieves a higher sale price can net you more than a discount agent who undersells your home.

What Not to Do

• Do not start negotiations by demanding the lowest possible rate
• Do not choose an agent solely on commission without evaluating their track record
• Do not eliminate the buyer's agent commission entirely unless you understand the consequences

The Bottom Line

Most sellers can negotiate 0.5-1% off the traditional commission rate, saving $2,000-$4,000 on a $400,000 home. The key is to approach negotiations as a business discussion, not a confrontation.