How realtor commissions work | How much agents make | Who pays California realtor commission? | Tips for saving on realtor fees
💰 How much is California realtor commission? 💰
The average realtor commission in California is 4.92% of a home’s sale price. That’s significantly lower than the national average commission of 5.49%.
Realtor commission is typically the single largest cost you’ll pay when selling your home. California has a median home value of $790,475, according to Zillow. At an average commission rate of 4.92%, a California realtor will make $38,891 on an average sale. That’s a big chunk of change!
But the good news is that you have lots of ways to reduce that cost.
One of the easiest ways to save on realtor costs is to work with a low-commission real estate agent. For example, our friends at Clever Real Estate connect you with experienced, elite agents in your area, who’ll provide a full-service experience at a fraction of the usual price — saving you thousands when you sell.
👋 Start your real estate journey by connecting with Clever’s concierge team today!
California Realtor Commission: How It Works
In the state of California, realtor estate commission is split between the seller’s agent and the buyer’s agent. Each agent also pays a portion of their commission to their brokers.
Why is the average commission in California so high? Well, listing agents do a lot of unpaid work up front to sell your home — and they typically don’t make a salary or any kind of regular paycheck outside their commissions.
Listing agents market each listing extensively, as more eyeballs on a home — and more offers — is what drives up its sale price. They also spend time and money finding new clients, which is unpaid, speculative work.
|⚡ Did You Know: Commission is a percentage of a home’s final sale price, and it’s the agents’ only payment throughout the sale.|
How Much Commission Do Realtors Make In California?
According to data from our friends at the Clever Data Center, the majority of California realtors charge between 4.39–5.45%, with an average commission of 4.92%.
However, most agents have to split their commissions with their brokers. In fact, agents are forbidden by law to work independently; they must work under a real estate broker.
Here’s how California realtor commission breaks down in a traditional home sale:
|Seller’s agent take home pay||1.26%|
|Seller’s agent’s broker split||1.26% (~50% of the seller’s agent’s commission )|
|Buyer’s agent take home pay||1.20%|
|Buyer’s agent’s broker split||1.20% (~50% of the buyer’s agent’s commission )|
Based on 1.26% take-home pay and a median California home value of $790,475, a realtor makes $9,959 on an average sale. That’s around $1,260 for every $100,000 sold.
California realtor commission can take a big bite out of your home sale proceeds — but change is already disrupting the status quo.
Our friends at Clever Real Estate negotiate more affordable listing fees on your behalf. Instead of paying nearly 3% in listing fees, agents within Clever’s nationwide network offer listing fees of just 1.5%. The average home seller who finds an agent through Clever saves $7,000!
Best of all, you won’t have to sacrifice customer service to save big on fees. Clever’s agents work for top-rated brokerages such as Keller Williams and Coldwell Banker — the only difference is that Clever introduces them to motivated homeowners who are serious about selling, so they spend less time hunting for clients and more time helping you.
💰 Learn how much you can save with Clever today!
How Much Do California Realtors Earn Annually?
According to the Bureau of Labor Statistics, real estate agents in California make an average of $76,440 a year.
That means the average California real estate agent sells seven or eight homes (or a little over $6 million in property) per year.
Who Pays Realtor Commission In California?
Traditionally, the seller pays realtor commission — this is true nationwide. But the question is actually a little more complicated than that.
Commission fees are baked into the price of the home and are paid out after the sale closes. That means the seller isn’t paying any money up front or out of pocket — they’re paying commission out of the sale proceeds.
How to Save On Real Estate Commission in California
Best Option: Find A Low-Commission Real Estate Agent
Low-commission real estate agents provide a full-service experience at a discounted rate, saving you thousands of dollars. But why do the agents get out of it? Yes, actually — a great deal.
By working with agent-matching services, agents get premium leads that take less time to close. So even though they might make less money on each individual sale, they easily make it up in volume.
We recommend working with our friends at Clever Real Estate, a free service that pairs you with experienced agents in your local market and pre-negotiates your savings.
With Clever, you’ll be personally matched with top-rated agents who work at national brokerages such as Keller Williams and Coldwell Banker. There’s no obligation to choose a Clever agent — but if you do find a great match, you’ll pay just 1.5% in listing fees, thanks to Clever’s pre-negotiated low rates.
💰 Save BIG with Clever! 💰
The average Clever customer saves $7,000 on their home sale. Find a great agent and save more with Clever today! It’s totally free and there’s zero obligation.
Negotiate Lower Fees With Your Agent
Bargaining can be difficult, since a real estate agent is a professional negotiator, and you’ll essentially be asking them to do their job for less money.
But it’s not impossible, especially if you’re selling a high-priced home or in a hot market, though it will take some leverage. An agent-matching service does all the negotiating for you.
Sell FSBO (For Sale By Owner)
Selling your home yourself is difficult and generally not widely recommended. But while you won’t pay any commission to a listing agent, you’ll still be covering the buyer’s agent’s commission.
Selling FSBO is only a good idea if you’re an experienced home seller — or you’re selling to a friend or family member. You really do have to do all the work yourself: market the home, negotiate with buyers, and file the closing paperwork. It’s a big job, and mistakes can have serious consequences if you make mistakes.
How hard is it to sell FSBO? According to the National Association of Realtors, only 7% of home sales in 2021 were FSBO sales, and they sold for a median price of $260,000. Meanwhile, agent-assisted sales sold for a median of $318,000.
Furthermore, 57% of FSBO sellers knew the buyer of their home, suggesting that most FSBO sales are personal transactions, not conventional sales in which the home is listed on the open market and buyers essentially find the price through competition.
FAQs About California Realtor Commission
How much are realtor fees?
On average, realtor commission is around 5.49% of a home’s total sale price. In California, the average realtor commission in California is slightly lower at 4.92%. Learn more.
How much commission does a realtor make in CA?
Based on 1.26% take-home pay and a median California home value of $790,475, a realtor makes $9,959 on an average sale. But that’s just one part of the total realtor commission home sellers in California pay. Learn the average California realtor commission — plus insider tips for how to save!