{"id":75346,"date":"2025-10-28T04:00:08","date_gmt":"2025-10-28T11:00:08","guid":{"rendered":"https:\/\/www.redfin.com\/blog\/?p=75346"},"modified":"2025-10-28T12:05:18","modified_gmt":"2025-10-28T19:05:18","slug":"how-do-real-estate-agents-get-paid","status":"publish","type":"post","link":"https:\/\/www.redfin.com\/blog\/how-do-real-estate-agents-get-paid\/","title":{"rendered":"How Do Real Estate Agents Get Paid?"},"content":{"rendered":"<h3><span style=\"font-weight: 400;\">Key takeaways<\/span><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Agents are paid through a negotiated commission agreed to in writing.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Rates and payment structures vary by market, brokerage, and services.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Buyers and sellers now have more flexibility in deciding how agent compensation is arranged.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Buying or selling a home often raises one big question: how do real estate agents get paid? Many people assume agents charge a flat fee or are paid directly by their clients, but in reality, <\/span><a href=\"https:\/\/www.redfin.com\/blog\/negotiating-real-estate-commissions\/\" data-wpel-link=\"exclude\"><span style=\"font-weight: 400;\">real estate commissions are fully negotiable<\/span><\/a><span style=\"font-weight: 400;\">. The exact fee depends on several factors,\u00a0 such as the market, the brokerage, and what\u2019s agreed to in writing between the parties.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Whether you\u2019re buying a <\/span><a href=\"https:\/\/www.redfin.com\/city\/8903\/TX\/Houston\" data-wpel-link=\"exclude\"><span style=\"font-weight: 400;\">house in Houston, TX<\/span><\/a><span style=\"font-weight: 400;\">, or looking at <\/span><a href=\"https:\/\/www.redfin.com\/city\/29470\/IL\/Chicago\" data-wpel-link=\"exclude\"><span style=\"font-weight: 400;\">homes in Chicago, IL<\/span><\/a><span style=\"font-weight: 400;\">, understanding how real estate commissions work can help you make informed decisions when choosing an agent or negotiating an offer. In this Redfin guide, we\u2019ll explain how real estate agents are paid, how commission splits work between agents and brokerages, and what to expect during the homebuying or selling process.<\/span><\/p>\n<h2><img fetchpriority=\"high\" decoding=\"async\" class=\"aligncenter wp-image-75347 size-blog-post\" src=\"https:\/\/www.redfin.com\/blog\/wp-content\/uploads\/2022\/03\/07_kitchen_consult_1884_RT_final-945x630.jpg\" alt=\"Couple asking their agent &quot;how do real estate agents get paid?&quot; so they know where their money is going\" width=\"945\" height=\"630\" srcset=\"https:\/\/www.redfin.com\/blog\/wp-content\/uploads\/2022\/03\/07_kitchen_consult_1884_RT_final-945x630.jpg 945w, https:\/\/www.redfin.com\/blog\/wp-content\/uploads\/2022\/03\/07_kitchen_consult_1884_RT_final-300x200.jpg 300w, https:\/\/www.redfin.com\/blog\/wp-content\/uploads\/2022\/03\/07_kitchen_consult_1884_RT_final-1024x683.jpg 1024w, https:\/\/www.redfin.com\/blog\/wp-content\/uploads\/2022\/03\/07_kitchen_consult_1884_RT_final-768x512.jpg 768w, https:\/\/www.redfin.com\/blog\/wp-content\/uploads\/2022\/03\/07_kitchen_consult_1884_RT_final-225x150.jpg 225w, https:\/\/www.redfin.com\/blog\/wp-content\/uploads\/2022\/03\/07_kitchen_consult_1884_RT_final-450x300.jpg 450w, https:\/\/www.redfin.com\/blog\/wp-content\/uploads\/2022\/03\/07_kitchen_consult_1884_RT_final.jpg 1200w\" sizes=\"(max-width: 945px) 100vw, 945px\" \/><\/h2>\n<h2><span style=\"font-weight: 400;\">Who pays the real estate agent?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">It depends on what\u2019s negotiated between the buyer, seller, and their agents. Historically, real estate agent commissions were often paid from the seller\u2019s proceeds at closing and split between both agents. Following the <\/span><a href=\"https:\/\/www.redfin.com\/blog\/real-estate-commission-changes\/\" data-wpel-link=\"exclude\"><span style=\"font-weight: 400;\">August 2024 NAR settlement<\/span><\/a><span style=\"font-weight: 400;\">, offers of buyer-agent compensation can no longer be made through the MLS. Sellers can still choose to offer compensation, but those agreements should be handled directly between the parties.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Today, there are several ways an agent\u2019s compensation can be structured, depending on what\u2019s agreed to in writing:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Seller-paid commission:<\/b><span style=\"font-weight: 400;\"> The seller may choose to pay their listing agent\u2019s commission and may also offer compensation to the buyer\u2019s agent, but this must be clearly disclosed and documented in the listing agreement.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Buyer-paid commission:<\/b><span style=\"font-weight: 400;\"> The buyer may agree to pay their agent directly, either as part of their closing costs or through a separate buyer-broker agreement.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Negotiated arrangements:<\/b><span style=\"font-weight: 400;\"> Buyers and sellers can agree to share or structure compensation differently,\u00a0 as long as the details are negotiated, disclosed, and documented in writing before representation begins.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Both buyers and sellers must now have written agreements with their agents outlining how compensation will be handled before touring homes or listing a property.<\/span><\/p>\n<p><b>Key takeaway:<\/b><span style=\"font-weight: 400;\"> Real estate agent compensation is fully negotiable. The payment structure should be agreed upon early and put in writing so everyone understands how and when each agent will be paid.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">Are buyers now responsible for paying their agent?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Not necessarily. Under the 2024 NAR settlement, buyers generally must sign a written agreement with their agent that clearly defines how much the agent will be compensated. Buyers can still ask the seller to cover their agent\u2019s fee when they submit an offer to purchase a home. That payment becomes part of the overall negotiation between the buyer and seller.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Sellers can still choose to cover the buyer\u2019s agent commission, but those offers can no longer be listed on the MLS and should instead be handled directly between the parties in writing.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">How is the real estate agent commission rate decided?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">There\u2019s no standard or fixed rate for a <\/span><a href=\"https:\/\/www.redfin.com\/blog\/how-much-is-real-estate-agent-commission-buyer-seller\/\" data-wpel-link=\"exclude\"><span style=\"font-weight: 400;\">real estate agent commission<\/span><\/a><span style=\"font-weight: 400;\">. Compensation is fully negotiable and can vary based on factors like the local market, property type, and the level of service provided.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Some brokerages, such as Redfin, charge a percentage-based commission, while others offer flat-fee or charge hourly based on the services provided. Whatever the structure, the commission agreement must be discussed, agreed upon, and documented in writing before any representation begins.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">How does a real estate agent earn commission?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Real estate agents earn commission by guiding clients through a home sale or purchase. They handle complex negotiations, legal paperwork, and deadlines to ensure a smooth closing.\u00a0<\/span><\/p>\n<p><a href=\"https:\/\/www.redfin.com\/blog\/sellers-agent\/\" data-wpel-link=\"exclude\"><b>Seller\u2019s agents<\/b><\/a><span style=\"font-weight: 400;\"> earn their commission by helping home sellers:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Research <\/b><a href=\"https:\/\/www.redfin.com\/blog\/how-to-find-real-estate-comps-in-my-area\/\" data-wpel-link=\"exclude\"><b>comparable home sales<\/b><\/a><span style=\"font-weight: 400;\"> to set a competitive price.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Recommend home improvements<\/b><span style=\"font-weight: 400;\"> and connect sellers with service providers.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Develop a pricing and marketing strategy<\/b><span style=\"font-weight: 400;\"> to attract buyers.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>List the home on the MLS<\/b><span style=\"font-weight: 400;\"> and promote it across platforms.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Review, present, and negotiate offers<\/b><span style=\"font-weight: 400;\"> to secure the best deal.<\/span><\/li>\n<\/ul>\n<p><a href=\"https:\/\/www.redfin.com\/blog\/how-do-buyers-agents-get-paid\/\" data-wpel-link=\"exclude\"><b>Buyer\u2019s agents<\/b><\/a><span style=\"font-weight: 400;\"> earn their commission by helping prospective home buyers:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Search for homes<\/b><span style=\"font-weight: 400;\"> that fit their needs and budget.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Tour properties<\/b><span style=\"font-weight: 400;\"> and provide local market insights.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Write and negotiate offers<\/b><span style=\"font-weight: 400;\"> that strengthen the buyer\u2019s position.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Coordinate inspections, appraisals, and closing tasks<\/b><span style=\"font-weight: 400;\"> to keep the process on track.<\/span><\/li>\n<\/ul>\n<h2><span style=\"font-weight: 400;\">How real estate commissions are divided and how much agents earn<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">After a home sale closes, each agent\u2019s agreed-upon commission is paid to their respective brokerage, which then compensates the agent according to their individual agreement. Because agents must work under a licensed brokerage, typically the brokerage receives the payment first before splitting it with the agent.\u00a0<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">How agent earnings vary<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">An agent\u2019s income depends on several key factors. The commission earned on a transaction is often based on the home\u2019s sale price and the negotiated commission rate. Additionally, once the commission is paid by the buyer or seller, it may be further divided between the agent and their own sponsoring brokerage.\u00a0 .<\/span><\/p>\n<p><span style=\"font-weight: 400;\">According to the NAR 2025 Member Profile, the median gross income for REALTORS\u00ae was <\/span><a href=\"https:\/\/www.nar.realtor\/magazine\/real-estate-news\/sales-marketing\/income-steady-even-as-market-slows-2025-member-trends\" data-wpel-link=\"external\" target=\"_blank\" rel=\"external noopener noreferrer\"><span style=\"font-weight: 400;\">$58,100 in 2024<\/span><\/a><span style=\"font-weight: 400;\">, remaining relatively steady even as the market slowed. Income levels vary widely depending on experience, transaction volume, and local market conditions.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">When and how do real estate agents get paid?<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Real estate agents are typically paid after a home sale closes, once the transaction is complete and all terms outlined in the agreements have been met.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Here\u2019s how the process generally works:<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">1. Offer accepted<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Once the buyer and seller agree on price and terms, the property goes under contract. The commission rate and payment structure are documented in the listing agreement or buyer-broker agreement.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">2. Escrow period<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">During <\/span><a href=\"https:\/\/www.redfin.com\/blog\/what-is-escrow\/\" data-wpel-link=\"exclude\"><span style=\"font-weight: 400;\">escrow<\/span><\/a><span style=\"font-weight: 400;\">, the buyer\u2019s payment, whether from financing, cash, or both, is held by the title or escrow company. The agent coordinates inspections, appraisals, and paperwork to help keep the real estate transaction on track.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">3. Closing day<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">On closing day, the title or escrow company releases the agreed-upon commission funds from the sale proceeds. Each brokerage receives its portion based on the transaction documents and then compensates the agent according to their broker-agent split (for example, a brokerage may let an agent keep 70% of the commission and the brokerage will keep 30%.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">4. Payment transfer<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Once funds are disbursed, they are transferred to the respective brokerages and agents according to the written terms. Timing can vary slightly by state or title company, but funds are often processed promptly upon closing.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">5. Special cases<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">In dual-agency transactions or cases where only one side has an agent, the total commission may differ based on what\u2019s negotiated and disclosed in writing.<\/span><\/p>\n<p><b>Key takeaway:<\/b><span style=\"font-weight: 400;\"> Agents are paid after closing, but the amount and source of payment depend entirely on the negotiated terms outlined in the parties\u2019 agreements.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">How Redfin agents are paid<\/span><\/h2>\n<p><a href=\"https:\/\/www.redfin.com\/guides\/how-are-redfin-agents-paid\" data-wpel-link=\"exclude\"><span style=\"font-weight: 400;\">Redfin\u2019s business model<\/span><\/a><span style=\"font-weight: 400;\"> differs from many traditional brokerages. Like other agents, Redfin agents earn competitive commission splits for helping customers buy and sell homes. But since Redfin agents are employees instead of independent contractors, they also receive employee benefits, support, and the chance to meet new customers from Redfin.com.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This structure provides agents with everything they need to run their business\u00a0 and covers certain <\/span><a href=\"https:\/\/www.redfin.com\/guides\/agent-resources\/how-much-does-it-cost-to-be-a-real-estate-agent\" data-wpel-link=\"exclude\"><span style=\"font-weight: 400;\">business expenses<\/span><\/a><span style=\"font-weight: 400;\">, such as marketing, listing costs, and mileage. The goal is to allow agents to focus on what they do best: helping clients buy and sell homes.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Redfin also employs technology and support staff to assist with scheduling, lead management, and transaction coordination. These tools help streamline the process for both agents and clients.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">How do real estate agents get paid FAQs<\/span><\/h2>\n<h3><span style=\"font-weight: 400;\">1. Do real estate agents get paid upfront or after closing?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Agents are paid after closing, once the home sale is complete. The title company releases the commission funds, which are then split between the brokerages and agents involved.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">2. Who pays the real estate agent, the buyer or the seller?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">It depends on what\u2019s negotiated in writing. Historically, the seller\u2019s proceeds often covered both agents\u2019 commissions, but buyers and sellers can now decide how each agent is compensated.\u00a0<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">3. Are real estate commissions negotiable?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Yes. Real estate commissions are always negotiable. Rates vary by market, property type, and the level of service an agent provides.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">4. Can buyers pay their agent\u2019s commission directly?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Buyers can negotiate and pay their agent\u2019s fee directly as part of their closing costs or through a separate agreement.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">5. How do real estate agents get paid if a deal falls through?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">If a home doesn\u2019t close, agents generally don\u2019t get paid. Commissions are typically only earned once a transaction is finalized.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">6. Can sellers still offer to pay the buyer\u2019s agent commission?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Yes. Sellers can still choose to compensate the buyer\u2019s agent, but those offers can\u2019t be displayed on the MLS\u2014they must be handled directly between parties.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">7. Do I have to pay a real estate agent commission at all?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">No. You\u2019re not required to use an agent when buying or selling, but hiring an agent can help with pricing, marketing, negotiations, and closing paperwork.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">8. What do closing costs include?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Closing costs cover fees for loan processing, title work, appraisals, taxes, and insurance. They\u2019re separate from commission fees and typically total 2%\u20137% of the home\u2019s purchase price.<\/span><\/p>\n<h3><span style=\"font-weight: 400;\">9. How can I find out exactly what I\u2019ll owe in commissions and fees?<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">All commission and fee details should be outlined in your listing or buyer\u2019s agreement. Review the contract before signing and ask your agent to explain each charge.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Learn how real estate agents get paid, who covers the commission, and what\u2019s changing under the NAR settlement in this complete Redfin guide.<\/p>\n","protected":false},"author":585,"featured_media":75347,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"default","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[34277],"tags":[1712,3621],"coauthors":[34682],"class_list":["post-75346","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-agents","tag-finance"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v24.7 (Yoast SEO v27.7) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>How Do Real Estate Agents Get Paid in 2025<\/title>\n<meta name=\"description\" content=\"Learn how real estate agents get paid, who covers the commission, and what\u2019s changing under the NAR settlement in this complete Redfin guide.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.redfin.com\/blog\/how-do-real-estate-agents-get-paid\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How Do Real Estate Agents Get Paid?\" \/>\n<meta property=\"og:description\" content=\"Learn how real estate agents get paid, who covers the commission, and what\u2019s changing under the NAR settlement in this complete Redfin guide.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.redfin.com\/blog\/how-do-real-estate-agents-get-paid\/\" \/>\n<meta property=\"og:site_name\" content=\"Redfin | Real Estate Tips for Home Buying, Selling &amp; 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