Do Buyers Pay Realtor Fees When Purchasing a Home?
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Richard Haddad Executive EditorRichard Haddad is the executive editor of HomeLight.com. He works with an experienced content team that oversees the company’s blog featuring in-depth articles about the home buying and selling process, homeownership news, home care and design tips, and related real estate trends. Previously, he served as an editor and content producer for World Company, Gannett, and Western News & Info, where he also served as news director and director of internet operations.
If your parents or grandparents bought a house with the help of a real estate agent, chances are, the sellers paid their Realtor fees. In today’s housing market, a major legal settlement has changed agent commission rules. Many potential homebuyers are now asking, “Do buyers pay Realtor fees?”
Following a court-approved agreement with the National Association of Realtors (NAR) last year, homebuyers are now responsible for negotiating Realtor fees directly with their buyer’s agent.
With the help of top-rated experts, we’ll explain what’s changed, what you might pay in Realtor fees as a buyer, and your options to avoid this additional expense.
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Do buyers pay Realtor fees?
While homebuyers are now expected to negotiate compensation directly with their own agents, which includes signing a buyer-broker agreement before touring properties, having a formal contract does not necessarily mean you’ll need to pay Realtor fees. You can still ask sellers to cover your agent fees.
“Buyers seem to think that they have to pay a buyer’s agent commission,” says Al DiRusso, a top-rated agent in Charlotte, North Carolina. “And sellers feel that they do not have to pay a buyer’s agent commission at all. Both cases can be true.”
He adds that whether you end up paying out of pocket or securing a seller contribution depends on what you and your agent negotiate as part of your offer. “An experienced agent can show that it can be business as usual in terms of commission.”
Angie Chavez, a top agent serving the Atlanta area, agrees. “The NAR settlement added another layer of confusion, but has not impacted how business is handled. Most sellers are agreeing to pay at least something toward buyer-broker compensation. They understand the impact it could have by not doing so. They’re looking at this as a marketing tool now.”
How much will you pay in Realtor fees?
If you end up being fully responsible for your buyer’s agent fee, the typical rate ranges from 2% to 3% of the home’s sale price. On a median-priced $400,000 home, that could mean $8,000 to $12,000 — a significant added expense on top of your down payment, closing costs, and moving expenses.
“The [NAR commission] change can have an unintended negative effect on the most vulnerable group of buyers: first-time and lower-income buyers,” says Angelina Keck, a Houston-area agent with 20 years of experience. “Meanwhile, the luxury market is thriving and is unaffected, further widening the gap between classes.”
Here’s a look at what you might pay based on different home prices and percentages if a seller does not agree to pay your Realtor’s fees:
| Home price | 3% Realtor fee | 2.5% Realtor fee | 2% Realtor fee |
| $100,000 | $3,000 | $2,500 | $2,000 |
| $150,000 | $4,500 | $3,750 | $3,000 |
| $200,000 | $6,000 | $5,000 | $4,000 |
| $250,000 | $7,500 | $6,250 | $5,000 |
| $300,000 | $9,000 | $7,500 | $6,000 |
| $350,000 | $10,500 | $8,750 | $7,000 |
| $400,000 | $12,000 | $10,000 | $8,000 |
| $450,000 | $13,500 | $11,250 | $9,000 |
| $500,000 | $15,000 | $12,500 | $10,000 |
| $550,000 | $16,500 | $13,750 | $11,000 |
| $600,000 | $18,000 | $15,000 | $12,000 |
| $650,000 | $19,500 | $16,250 | $13,000 |
| $700,000 | $21,000 | $17,500 | $14,000 |
| $750,000 | $22,500 | $18,750 | $15,000 |
| $800,000 | $24,000 | $20,000 | $16,000 |
| $850,000 | $25,500 | $21,250 | $17,000 |
| $900,000 | $27,000 | $22,500 | $18,000 |
| $950,000 | $28,500 | $23,750 | $19,000 |
| $1,000,000 | $30,000 | $25,000 | $20,000 |
| $1,500,000 | $45,000 | $37,500 | $30,000 |
The 2%-3% fee example amounts in this table aren’t set in stone. Commission rates are negotiable, and your agreement with your agent will outline the specific terms. Some agents or brokerages may offer a reduced commission for loyal clients, charge a flat fee, or agree to only collect payment if the seller doesn’t cover their portion.
Why sellers often pay buyer Realtor fees
For generations, it’s been standard practice for home sellers to cover the buyer’s agent’s commission. Why? Because offering this compensation helps attract more potential buyers. By covering the buyer’s agent fee, sellers make their listing more appealing, especially to buyers who might not have the extra funds to pay their agent out of pocket.
This approach benefits sellers, too. The broader the pool of interested buyers, the greater the chance of receiving competitive offers, which can sometimes even drive up the final sale price.
“Some sellers do not understand the ramifications of not offering buyer broker compensation,” says Elaine Johnson, a Las Cruces, New Mexico, agent with 32 years of experience. “They don’t realize they are seriously limiting the available pool of buyers. Most buyers can barely afford to get into a home with a minimum down payment. Add commissions on top of their closing costs, and they just can’t do it.”
Although sellers are no longer required to offer to pay this fee under the updated NAR rules, many continue to do so as a strategic move to help their home stand out and get sold.
Many buyers today are prioritizing homes where the seller is still offering to pay the buyer’s agent, helping to offset this potential cost.
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Does a house cost more if a seller pays your fees?
While that can happen, home prices are ultimately determined by market value, not just by who pays which fees. If a home is priced too high, regardless of the reason, it risks sitting on the market longer or requiring price reductions. Most sellers and their agents understand this and aim to price competitively based on comparable sales.
In our current high-interest-rate market, hesitant buyers are being especially careful about staying within their budget on offer prices and agent fees.
“Some of my clients want to see something [in writing] showing that my fees will be covered by the seller prior to seeing a house,” says Jessica Arledge, a top Savannah, Georgia, agent. “Then they want to make sure our agreement matches what the seller has offered to pay because they just flat do not have the money for the down payment, closing costs, and Realtor fees.”
Offering to cover the buyer’s agent fee is typically factored into the seller’s net proceeds, but it doesn’t necessarily result in a higher sales price. Instead, it’s a way to make the deal smoother and more appealing to buyers.
What else can you ask the seller to pay?
In addition to requesting that the seller cover your buyer’s agent fee, you can negotiate for other concessions to help reduce your out-of-pocket costs. Common seller-paid items include:
- Closing costs: Sellers can contribute to your closing costs, like lender fees, title insurance, and escrow charges.
- Home warranty: Some buyers ask the seller to pay for a home warranty, offering peace of mind for repairs in the first year.
- Repair credits: If the home inspection reveals issues, you might negotiate for the seller to cover repairs or provide a credit at closing.
- Rate buydowns: In some cases, sellers may offer to help buy down your mortgage interest rate, reducing your monthly payments.
Everything is negotiable, so it’s worth discussing these options with your agent as you craft your offer. Even if a seller is not willing to cover all or part of your Realtor fees, a different concession or credit may be a middle-ground compromise that helps you close a win-win deal.
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What’s in the buyer-broker agreement?
A buyer-broker agreement is a formal contract between you and your real estate agent that outlines the terms of your working relationship, including how your agent will be compensated.
Since the NAR rule changes, this agreement has become a required step before touring homes to ensure both parties are clear on fees and expectations.
“Many buyers are not comfortable signing an agreement just to view a property,” says Barbara Hill, a top agent in East Texas. “They want to develop a relationship with the agent before being committed to that agent.”
Becky Partin, another Savannah area top agent, echoes this buyer commitment concern and what can happen if a buyer doesn’t understand the contract. “Buyers are timid about signing…If an agent does a poor job of explaining the agreement, then they could potentially have multiple agreements signed.”
Key elements of a buyer-broker agreement typically include:
- Commission structure: How much your agent will be paid (often a percentage of the sale price) and who is responsible for payment.
- Term of the agreement: The length of time the contract remains in effect.
- Agent responsibilities: Details on how your agent will assist you in finding and purchasing a home.
- Exclusivity clause: Some written buyer agreements require you to work exclusively with one agent during the term.
Before signing, take time to review the agreement carefully and ask questions about how the commission might be handled and how much the agent expects in compensation, especially regarding your desire for the seller to pay your Realtor fees.
“I almost lost a buyer because their agent wanted 2.5% commission, and my [seller] clients only offered 2%. The buyers couldn’t afford the difference,” says Beth Carbone, an expert Realtor in the Central Coast region of California.
In this particular case, Carbone felt the buyer’s agent had lost his focus. “The agent was willing to walk away from the deal… he literally put his commission before the buyer’s wants and needs.”
Do you need a buyer’s agent to purchase a home?
It may be tempting to forgo agent representation and work through the seller’s Realtor as a dual agent, but Arledge, who works with nearly 80% more single-family homes than average agents in her Savannah market, says this can create a costly conflict for buyers.
“You would not want the same divorce attorney representing both parties,” she explains. “There are many things buyer’s agents do for buyers that a listing agent would not do because it is their job to have the seller’s best interest at heart.”
Arledge explains that a buyer’s agent will:
- Help buyers understand and review their loan terms
- Look at comparable home sales and determine if a house is priced appropriately
- Negotiate and often write multiple offers before coming to terms on a house
- Schedule and navigate home inspections and requested repairs
- Stay on top of deadlines (and lenders) to protect the Buyer’s earnest money
- Do a final walkthrough to make sure any negotiated repairs have been made correctly
- Ensure the home is in the same condition it was in when it went under contract
“A good buyer’s agent will also help a buyer understand all of their rights and obligations per the terms of a contract and will negotiate on the buyer’s behalf to try to make sure they are getting the best deal possible — and that all the terms are favorable for the buyer,” Arledge says.
Dual agency is illegal or heavily restricted in nine states: Alaska, Colorado, Florida, Kansas, Maryland, Oklahoma, Texas, Vermont, and Wyoming. This means a single real estate agent cannot legally represent both the buyer and the seller in the same transaction within these states.
Partner with a top agent to buy your home
Working with the right real estate agent can make all the difference, especially in today’s shifting market. A top-rated agent will help you understand your options for covering Realtor fees, negotiate with sellers, and secure the best deal possible under the new NAR rules.
Brittney Reynolds, a West Texas top agent, says there are upsides to the agent rule changes. “I believe the settlement has led to more helpful communications about representation and compensation. When explained properly to buyers and sellers, it clears up confusion and makes transactions easier.”
HomeLight’s free Agent Match platform can connect you with the highest-rated agents in your area based on transaction data and client reviews, not just paid website profiles.
Whether you need an agent skilled in negotiating seller-paid commissions or someone who knows your selected market inside and out, you can get started today by answering a few questions about your desired home and where you want to live.
Header Image Source: (Roger Starnes Sr/ Unsplash)
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