How Much Do Agents Charge To Sell Your House – If you​​​​​​have ever watched HGTV, you already know that there are many shows featuring professionals in California. With high home prices, it’s easy to imagine that California realtors are making a good living.

The Flip or Flop duo may have welcomed tens of thousands of people into the homes they renovated during the 10 years their reality series aired, but how does the average California agent compare?

How Much Do Agents Charge To Sell Your House

Learn about all the fees and costs you need to pay to get your California real estate license.

What It Really Costs To Sell My House By Owner

If you’re looking for an average, has calculated it for you. According to their research, in the fall of 2022, the average annual salary for California agents was $91,363.

But that is not the whole story. Nationally, real estate agent salaries range from an average of $28,270 for the bottom 10th percentile to $102,170 in the top 10th percentile. Why is there such a large wage gap? The amount of work you do will affect how much you earn and location also makes a difference. And you’ll find that this is as true in California as it is across the country.

As anyone who lives in California knows, there is a big difference between Northern California and Southern California. Likewise, the life and income of real estate in larger metropolitan areas will be significantly different than those in more rural areas.

According to (Fall 2022), here’s what real estate agents are making in California’s 10 largest cities:

A Must Read Guide On How To Sell Your House

How Much Do California Realtors Take Home After Each Closing? There are some commission splits to consider.

First, the total commission is paid by the seller. In California, it ranges from 1 to 6% of the sales price. The standard is 5-6%, but for high value properties (ie more than $1 million) the commission can be higher than 4-5%. The amount is negotiated between the seller and the listing agent before the contract is signed.

Next comes the commission split between the listing and the buyer’s agent. Typically the commission is split 50/50. From time to time you may see a listing that offers the buyer’s agent a higher split in hopes of attracting more leads. The opposite can also be true. The listing agent may keep 3.5% to offset the cost of selling the property and offer only 2.5% to the buyer’s agent.

Dual agency is another possibility. If the listing agent finds the buyer and represents both, they get the full commission.

Reasons Why You Should Hire A Real Estate Agent To Sell Your Home

Finally, the commission is split between agent and broker. The broker will receive the proceeds of a sale and then pay the agent their share. The agreed commission split can vary from agent to agent, even within the same brokerage. New agents may receive a 50/50 split, while experienced agents may receive more of a 70/30 or 80/20 split.

There are also two other possible commission scenarios. You can pay a monthly broker fee and keep 100% of the commission. The broker may also offer a sliding scale commission split. In this case, the commission starts low at 40/50 or 50/50 and becomes more beneficial the more you sell.

Last but not least is the tax factor. California is known for having high taxes and the broker does not deduct anything when paying the agent their share of the commission. That means the agent must subtract taxes every time he receives a commission check.

As independent contractors, real estate agents must pay estimated taxes each quarter. Estimated taxes include income tax and self-employment tax, which covers Medicare and Social Security taxes. You should check the most recent tax brackets to determine how much you will have to pay each quarter.

Pros, Cons, And Steps To Selling Your House Without A Realtor

California also has a state income tax. California has 10 income tax brackets, the most in the country. Unfortunately, the state is also known to have the highest state tax at 12.3%. But that only applies to individual income over $625,370 or married filing joint income over $1,250,739. California agents and brokers will pay between 0 and 9.3%.

At the end of the day, real estate is a profession where your salary is not set in stone. Set your sights high and you could be one of the highest paid agents in the country. Let’s say I’ve decided to sell my house. Now I have to decide if I will use a licensed realtor or sell my home by owner (FSBO). Many homeowners decide to try selling by owner because of the belief that they can save money. Additionally, the most common reason cited is that homeowners don’t want to pay the sales agent’s commission. However, I have found that sales by owner has hidden costs, regardless of the commission savings.

A study published by Dr. In August 2017, Sklarz and Miller collected information on completed sales in more than a thousand zip codes across the United States. Their goal was to compare the sale prices of homes sold by owner to those sold by a licensed broker. They hypothesized that homes for sale by owner, even with a non-MLS website location, would sell for “slightly less” than comparable homes and markets.

The two authors found that the sale price of a house sold by the owner was 5.5% less than that sold by a real estate agent. They concluded about the percentage “despite the proliferation of public listing sites on the Internet.”

How Much Does A Real Estate Agent Make Per Sale?

However, the study by Dr. Sklarz and Miller did not address any other costs that I should consider when selling my home. I would call them the “hidden costs” of real estate transactions. Costs include things like market research, open houses, advertising, and more. These are not costs that you necessarily have to pay when you hire a licensed broker. In addition to the hidden costs, when I sell my house there may still be a commission for the buyer’s agent to consider.

For starters, the average price of a home sold in the United States was $264,800 in May 2018 according to NAR statistics. NAR is the National Association of REALTORS. From the same source, the average gross annual income of a broker was used to calculate the hourly wage. Salary was calculated using a 40-hour work week ($20.43/hour).

Calculating the hidden costs of selling a home based on the NAR median home price and the annual gross income of a real estate agent.

The total amount that I, as a seller, do not pay an agent to sell my home outside of the selling agent’s commission is $3,373.96. This amount is an estimate of the value of professional time and supplies as stated above and shown above. However, it’s actually more than this amount because a FSBO home sells for 5.5% less than the home’s sales price, according to the Sklarz and Miller study. The study states that 5.5% is “remarkably close to average commission rates.” If we use this amount indicated in the study as the average commission rate, we will assume that 50% of this number would be an estimate of the commission for a buyer’s broker. On our median home price of $264,800, the buyer’s brokerage commission is $5,958. This is usually paid by the seller.

Why Didn’t My Home Sell (here’s Why Your House Isn’t Selling)

Therefore, I am paying a total of approximately $23,895 to sell my home by owner for an average priced home in the US. If I had hired an agent and paid them the .5% rate listed in the 5 study, I would have only paid $14,564. This amount is 164% more than I would have paid if I, as the seller, had hired an agent to start with and only paid the sales agent’s commission!

Legal fees for a mistake can also increase the cost of selling a home. This is certainly true if the owner does not fully understand real estate law. What if there is a scam on the non-MLS website? What would happen if you do something against real estate law? Licensed real estate agents are insured for these legal cases called E&O insurance.

The financial benefits of selling a property by owner are clouded by the seller’s initial desire to avoid paying the sales agent’s commission. Homeowners should consider the time, knowledge and materials required to sell a home before considering selling on their own without an agent. FSBO individuals pay 1.6 times more to sell the home themselves, and perhaps much more if a legal issue arises. Therefore, sound financial decisions based on hidden costs must be made before listing a home for sale by owner.

This study is provided by Sellect Realty. Sellect Realty is an independent real estate company in the Atlanta, Georgia metropolitan area. The broker has more than 100 qualified agents to sell your home. All agents are insured and receive Georgia real estate education through courses approved by the Georgia Real Estate Commission. Select Realty office phone number is 770-509-0265 and office email is contact@ Our website is

Selling Lakes Region Real Estate

Dollinger, Jane. “The sale of existing homes is decreasing and is decreasing by 0.4 percent

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