April 24, 2026 · By Alex Morgan
Real Estate Commission by State: 2026 Rates Guide
Selling or buying a home? The commission you pay your real estate agent is likely the single biggest transaction cost you’ll face — often tens of thousands of dollars. Since the landmark NAR settlement took effect in August 2024, the rules for how those fees are negotiated and disclosed have shifted significantly.
This guide breaks down average real estate commission rates for all 50 states plus D.C., explains the new rules, and gives you practical strategies to negotiate a better deal.
What Is a Real Estate Commission?
A real estate commission is a percentage of a home’s final sale price paid to the real estate agents involved in the transaction. Historically, the total commission ranged from 5% to 6%, split between the seller’s agent (listing agent) and the buyer’s agent. Commissions are negotiable — no law, regulation, or industry rule sets a fixed rate.
Before the August 2024 NAR settlement, sellers typically offered a specific buyer agent commission through the Multiple Listing Service (MLS), a shared database where agents publish property listings. That offer was visible to all agents. Post-settlement, the MLS no longer includes a field for seller-offered buyer agent compensation. Buyers must now sign a written buyer representation agreement specifying their agent’s fee before touring homes. Sellers decide independently whether to offer a concession toward that fee.
For a deeper dive, see our NAR settlement explained guide.
Average Real Estate Commission Rates by State (2026)
Commission rates vary meaningfully by state. Local home prices, market competition, and the density of discount brokers all drive differences. The table below reflects 2025–2026 survey data compiled from RealTrends, Clever Real Estate, and Redfin research.
| State | Avg Total Commission % | Avg Seller Agent % | Avg Buyer Agent % |
|---|---|---|---|
| Alabama | 5.44% | 2.81% | 2.63% |
| Alaska | 5.00% | 2.60% | 2.40% |
| Arizona | 5.10% | 2.65% | 2.45% |
| Arkansas | 5.50% | 2.82% | 2.68% |
| California | 4.52% | 2.35% | 2.17% |
| Colorado | 4.89% | 2.55% | 2.34% |
| Connecticut | 5.12% | 2.65% | 2.47% |
| Delaware | 5.22% | 2.70% | 2.52% |
| D.C. | 4.72% | 2.48% | 2.24% |
| Florida | 5.04% | 2.62% | 2.42% |
| Georgia | 5.32% | 2.76% | 2.56% |
| Hawaii | 4.98% | 2.58% | 2.40% |
| Idaho | 5.18% | 2.68% | 2.50% |
| Illinois | 5.06% | 2.64% | 2.42% |
| Indiana | 5.38% | 2.78% | 2.60% |
| Iowa | 5.46% | 2.82% | 2.64% |
| Kansas | 5.42% | 2.80% | 2.62% |
| Kentucky | 5.40% | 2.78% | 2.62% |
| Louisiana | 5.36% | 2.76% | 2.60% |
| Maine | 5.14% | 2.66% | 2.48% |
| Maryland | 5.00% | 2.60% | 2.40% |
| Massachusetts | 4.84% | 2.52% | 2.32% |
| Michigan | 5.24% | 2.72% | 2.52% |
| Minnesota | 5.10% | 2.64% | 2.46% |
| Mississippi | 5.54% | 2.84% | 2.70% |
| Missouri | 5.34% | 2.76% | 2.58% |
| Montana | 5.20% | 2.68% | 2.52% |
| Nebraska | 5.40% | 2.78% | 2.62% |
| Nevada | 4.96% | 2.58% | 2.38% |
| New Hampshire | 5.02% | 2.60% | 2.42% |
| New Jersey | 5.00% | 2.60% | 2.40% |
| New Mexico | 5.28% | 2.74% | 2.54% |
| New York | 4.58% | 2.40% | 2.18% |
| North Carolina | 5.18% | 2.68% | 2.50% |
| North Dakota | 5.42% | 2.80% | 2.62% |
| Ohio | 5.30% | 2.74% | 2.56% |
| Oklahoma | 5.44% | 2.80% | 2.64% |
| Oregon | 4.92% | 2.56% | 2.36% |
| Pennsylvania | 5.16% | 2.68% | 2.48% |
| Rhode Island | 4.96% | 2.58% | 2.38% |
| South Carolina | 5.34% | 2.76% | 2.58% |
| South Dakota | 5.46% | 2.82% | 2.64% |
| Tennessee | 5.30% | 2.74% | 2.56% |
| Texas | 5.12% | 2.66% | 2.46% |
| Utah | 4.98% | 2.58% | 2.40% |
| Vermont | 5.10% | 2.64% | 2.46% |
| Virginia | 5.06% | 2.62% | 2.44% |
| Washington | 4.68% | 2.44% | 2.24% |
| West Virginia | 5.58% | 2.86% | 2.72% |
| Wisconsin | 5.24% | 2.72% | 2.52% |
| Wyoming | 5.60% | 2.88% | 2.72% |
(Source: RealTrends, 2026; Clever Real Estate, 2025; Redfin Research, 2026)
Highest-commission states include Wyoming (5.60%), West Virginia (5.58%), and Mississippi (5.54%). These states tend to have lower median home prices. Agents need a higher percentage to earn a viable income per transaction.
Lowest-commission states include California (4.52%), New York (4.58%), and Washington (4.68%). High home values in metros like Los Angeles, Manhattan, and Seattle mean agents earn more per deal even at lower rates. Competition from Redfin and similar discount brokers pushes rates down further.
Metro-level rates often differ sharply from statewide averages. A rural upstate New York transaction might carry a 5.5% total commission. A Manhattan condo sale might close at 4% or less. Sellers who check only state averages — without looking at local comps — risk overpaying or setting unrealistic expectations.
How the 2024 NAR Settlement Changed Commission Rules — And What It Means for Your Transaction
In March 2024, the National Association of Realtors (NAR) agreed to a $418 million settlement to resolve class-action lawsuits — notably Sitzer/Burnett v. NAR — alleging that NAR rules artificially inflated commissions. The new rules took effect on August 17, 2024, and reshaped how residential real estate transactions work across the country.
The three biggest changes:
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MLS commission fields eliminated. Sellers can no longer advertise a specific buyer agent commission through the MLS. Before August 2024, a listing might display “2.5% to buyer’s agent” — that field no longer exists.
-
Written buyer representation agreements required. Before a buyer’s agent can show a single home, the buyer must sign an agreement that states the agent’s compensation, how it will be paid, and that the fee is negotiable.
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Independent negotiation. Buyers and sellers now negotiate agent fees separately. A seller decides what to pay their listing agent. A buyer agrees on a fee with their own agent. The seller may offer a concession to help cover the buyer’s agent fee, but there is no obligation to do so.
Agents working in post-settlement markets say the biggest practical shift is buyer sticker shock. Many first-time buyers had no idea they might owe their agent a fee directly. They’re now asking sharper questions about what services justify that cost.
The Department of Justice (DOJ) continued scrutinizing commission practices throughout 2025 and into 2026, signaling that further regulatory action remains possible (Source: DOJ Antitrust Division public statements, 2025). The Consumer Federation of America has also published reports tracking whether the settlement produced meaningful fee reductions for consumers (Source: Consumer Federation of America, 2026).
Before vs. After the NAR Settlement — MLS Commission Disclosure:
| Pre-August 2024 | Post-August 2024 | |
|---|---|---|
| MLS buyer agent commission field | ✅ Visible to all agents | ❌ Removed entirely |
| Seller obligation to offer buyer agent fee | Expected/standard practice | No obligation |
| Buyer representation agreement | Optional in most states | Required before home tours |
| Commission negotiation | Often bundled as one total rate | Buyer and seller negotiate independently |
One limitation: the settlement applies specifically to NAR-affiliated MLSs and their members. A small number of non-NAR brokerages operate outside these rules, but they represent a minor share of the market. For a complete breakdown, read our buyer agent agreement guide.
Who Pays the Real Estate Commission?
Historically, the seller paid the full commission — typically 5% to 6% — at closing, split between the listing agent and the buyer’s agent. The cost was baked into the sale price, so buyers indirectly funded both sides through a higher purchase price.
Post-settlement, the structure is more flexible. Sellers may still offer to cover the buyer’s agent fee as a closing concession. Early data shows roughly 70% to 80% of transactions in 2025 still involved some form of seller-funded buyer agent compensation (Source: Redfin Research, 2025). The reason is practical. Sellers who refuse any buyer agent concession often see fewer showings and offers, especially in balanced or buyer-friendly markets.
Buyers can now pay their agent directly — either out of pocket at closing or, in some cases, by rolling the cost into their mortgage. The Federal Housing Administration (FHA) and Department of Veterans Affairs (VA) updated their guidelines in late 2024 and 2025 to allow certain buyer agent fees to be financed, giving borrowers more options (Source: FHA Mortgagee Letter 2024-12, 2024).
A tradeoff to consider: Financing your buyer agent’s fee means you pay interest on that amount over the life of your loan. On a 30-year mortgage at 7%, financing a $10,000 buyer agent fee adds roughly $13,900 in total interest costs. Paying out of pocket at closing, if you can afford it, is typically cheaper long-term.
How to Negotiate Real Estate Commissions — Five Tactics That Work
Sellers and buyers who actively negotiate their commission rates typically save thousands of dollars. Clever Real Estate’s 2025 survey found that 73% of sellers who asked for a lower rate received one (Source: Clever Real Estate, 2025). Here are five practical approaches:
1. Get quotes from at least three agents. Ask each agent to break down their fee, what services are included, and whether they’re flexible on rate. This is the single most effective negotiation move. It gives you real market data to reference in conversations.
2. Use a discount broker. Services like Redfin (1%–1.5% listing fee, as of 2026) and Clever Real Estate (which pre-negotiates reduced rates with local agents) operate in most states. More on this below.
3. Adjust your offer based on market conditions. In a seller’s market with limited inventory, agents may accept a lower commission because homes sell quickly with less marketing effort. In a slow market, offering a slightly higher buyer agent concession can attract more showings and competing offers.
4. Consider a flat-fee MLS listing. If you’re comfortable handling some of the selling process yourself, flat-fee MLS listing services let you list on the MLS for a one-time fee of $200 to $500 (as of 2026) instead of a percentage-based commission. The tradeoff: you’ll handle inquiries, showings, and potentially negotiations on your own.
5. Negotiate the services, not just the rate. If an agent won’t budge on percentage, ask them to include professional photography, staging consultation, or a home warranty as part of their commission. These add-ons can be worth $1,000 to $3,000 and effectively reduce your net cost.
Example: A homeowner in Charlotte, NC, listed her $450,000 home in early 2026. Her first agent quote was 6% total ($27,000). After interviewing two more agents and mentioning she was considering a discount broker, she negotiated a 4.5% total rate — saving $6,750. Her agent agreed because the home was in a desirable neighborhood expected to sell within 30 days. Sellers in high-demand areas tend to have the strongest negotiating position because agents know the deal will close quickly with minimal effort.
Discount Brokers vs. Traditional Agents: What You Give Up and What You Save
Not all brokers charge the same rates, and not all discount brokers are available in every state.
| Broker | Listing Fee | Buyer Agent Fee | Availability (as of 2026) |
|---|---|---|---|
| Redfin | 1%–1.5% | 2%–2.5% | 80+ major metros across 40+ states |
| Clever Real Estate | 1.5% (pre-negotiated) | Varies by agent | All 50 states |
| Homie | Flat fee ($3,500–$5,000) | 2%–2.5% | UT, AZ, NV, CO, ID |
(Source: Redfin, 2026; Clever Real Estate, 2026; Homie, 2026)
Full-service agents typically provide broad marketing, staging advice, open houses, and hands-on negotiation. Limited-service or discount brokers may cut certain services — like in-person showings or custom marketing campaigns. Before signing with any broker, ask for a written list of included services. Compare apples to apples.
iBuyers like Opendoor and Offerpad offer another path. They buy your home directly, so traditional commissions don’t apply. But their service fees — typically 5%–6% of the sale price as of 2026 — often match or exceed what you’d pay a traditional agent (Source: Opendoor, 2026). They also tend to offer below-market purchase prices, which can wipe out any commission savings. They operate in roughly 50 metros nationwide. Compare options on our discount real estate brokers page.
How Much Will You Actually Pay? Cost Examples
Percentages feel abstract. Here’s what commissions look like in real dollars:
| Home Sale Price | 2.5% (Buyer Agent Only) | 3% (Buyer Agent Only) | 5% Total | 6% Total |
|---|---|---|---|---|
| $300,000 | $7,500 | $9,000 | $15,000 | $18,000 |
| $500,000 | $12,500 | $15,000 | $25,000 | $30,000 |
| $750,000 | $18,750 | $22,500 | $37,500 | $45,000 |
On a $500,000 home, the difference between a 5% total commission and a 4.5% total commission is $2,500. On a $750,000 home, that same half-percent savings is worth $3,750.
Say the seller pays a 2.5% listing agent fee and offers a 2% buyer agent concession. The total drops to 4.5%. The buyer’s agent earns $10,000 on a $500,000 sale instead of the traditional $15,000 at 3%. Every fraction of a percentage point is worth negotiating — especially on higher-priced properties where the dollar impact scales fast.
Use a commission calculator — Zillow and Redfin both offer free ones — to plug in your specific home value and compare scenarios.
State-Specific Commission Laws and Disclosures
No state in the U.S. legally sets a minimum or maximum real estate commission rate. The Federal Trade Commission (FTC) and DOJ have long held that any such rate-fixing would violate federal antitrust laws.
But several states impose specific disclosure requirements around commissions and agency relationships:
- California requires agents to provide a written disclosure of the commission arrangement to both parties before an offer is made (Cal. Civ. Code § 2079.16).
- New York mandates an agency disclosure form at the first substantive contact with a buyer or seller.
- Illinois requires licensees to provide written agency representation agreements and clearly disclose all compensation terms.
Since August 2024, the NAR settlement has effectively imposed a nationwide requirement for written buyer agency agreements. Many states — including Texas, Florida, and Colorado — that previously had no such mandate now require them as a condition of MLS participation.
A practical note: disclosure forms vary significantly in length and complexity. California’s runs several pages. Some states use a single-page form. Buyers and sellers who read these documents carefully — rather than treating them as formalities — are better positioned to understand exactly what they’re agreeing to pay and why.
Check your state’s real estate commission licensing board for the latest requirements. A directory is available at ARELLO.org.
For guidance on selling without an agent, see our how to sell your home without an agent resource.
Frequently Asked Questions
What is the average real estate commission rate in the US in 2026?
The average total real estate commission in 2026 is roughly 4.5% to 5.5% of the sale price, split between the seller’s agent and buyer’s agent. Rates vary by state and metro area, and they are negotiable in every transaction (Source: RealTrends, 2026).
Did the NAR settlement lower real estate commissions?
The August 2024 NAR settlement changed how commissions are negotiated and disclosed. But early evidence shows only a modest reduction in average rates so far. The Consumer Federation of America’s 2026 report found that total commissions dropped by approximately 0.3 to 0.5 percentage points on average in the first 18 months after the settlement took effect. The larger impact has been on transparency — buyers now see and agree to their agent’s fee upfront rather than having it bundled invisibly into the transaction (Source: Consumer Federation of America, 2026).
Can I buy a home without paying a buyer’s agent commission?
Yes. You can work directly with the listing agent — a practice called dual agency, which is legal in most but not all states — or represent yourself as an unrepresented buyer. The tradeoff is that you lose independent advocacy during negotiations. In dual agency situations, the agent represents both sides, which creates an inherent conflict of interest. States like Colorado, Florida, and Kansas prohibit dual agency outright (Source: ARELLO, 2025).
Are real estate commissions tax-deductible?
For sellers, the commission reduces your net sale proceeds, which in turn reduces any taxable capital gain on the property. You don’t deduct the commission as a separate line item — it’s subtracted from the sale price when calculating gain. Consult a tax professional for your specific situation, especially if you’re claiming the primary residence capital gains exclusion under IRS Section 121 (Source: IRS Publication 523, 2025).