The typical U.S. home seller pays a 2.55% commission to the real estate agent hired by their buyer, down from an average of 2.62% in January, according to a Redfin analysis of MLS data. In other words, the March 2024 settlement between the National Association of Realtors (NAR) and plaintiffs in the Sitzer-Burnett case has likely already begun to push down commissions in markets across the country.
Redfin looked at the four-week periods that ended on Jan. 28 and July 14 of this year to compare average commission rates paid to a buyer’s agent. The analysis excluded listings that offered no commission and those for which the commission field was missing.
At the national level, the average commission paid to a buyer’s agent was $15,377 in June and July, up slightly from $15,124 in January, which Redfin attributed to a rise in home prices.
Redfin reported that the average percentage of commission paid to buyer’s agents has gradually fallen since the NAR settlement was announced, although the decrease “is small and the dollar amount paid to buyer’s agents has held steady.”
That’s in addition to the decade-long drop in buyer’s agent commissions, which fell from 2.89% in 2013 to 2.66% in 2023, Redfin reported.
“Redfin agents are reporting that commissions have been top of mind for clients since the NAR settlement was announced, and some sellers are asking about what it would mean to offer no commission or a relatively low one,” Redfin chief economist Daryl Fairweather said in a statement.
“Still, even before the blitz of publicity around the class-action lawsuits and NAR settlement, commissions were coming down. That’s partly because of the competitive housing market before and during the pandemic — which motivated some sellers to offer a low commission because they knew they could still attract buyers —and greater fee transparency.”
Redfin analysts found that commission percentages paid to buyer’s agents have declined in all but three of the nation’s 50 largest metros since the NAR settlement was announced. They increased incrementally in Cincinnati (up 2 basis points since January) while staying flat in New Brunswick, New Jersey, and Montgomery County, Pennsylvania.
The analysts also found that most of the declines are small, less than one-tenth of a percentage point. Commission rates have declined the most in Detroit as the average commission paid to a buyer’s agent there was 2.87% during the four weeks ending July 14, down from 3.18% in January. Next on the list were Cleveland (2.39%, down from 2.62%) and Miami (2.63%, down from 2.84%).
Commission rates are highest in Austin (2.99%), Cincinnati (2.95%) and San Antonio (2.91%). They’re lowest in Nassau County, New York (1.95%); Providence, Rhode Island (2.05%); and Anaheim, California (2.11%).
