What Percentage Do Most Realtors Charge in California?

By PropertyClub Team
Feb 19th 2024
When you enlist the help of a realtor to sell your California home, chances are you’ll be the one paying the commission. Although you can negotiate the percentage, and there are ways to lower the fee, it’s standard for the commission to be paid out of the proceeds from the sale. So here is what you can expect to pay if you use a realtor to sell your home in California.

hash-markHow Much Commission Do Buyers Agents Charge in California?

It’s standard for buyers’ agents to charge between 2% to 3% of the purchase price as a commission in California. So, if you are planning on hiring your own agent as well, you can expect to pay anywhere from 4-6% of the price of the home. Although the exact fee depends on what you negotiate, the commission tends to be higher for more expensive properties.

So, if the home is worth over $1,000,000, you can expect to pay up to $60,000 or more in realtor commissions, depending on how many agents are involved in the deal. But if the home is more moderately priced at $400,000, you can expect to pay anywhere from $15,000 to $24,000 on broker fees.

hash-markCan You Negotiate Realtor Fees in California?

Yes, California real estate commissions are negotiable, but how much depends on the leverage you have and the conditions of the market. Real estate agents work on commission, so you’ll have trouble finding someone willing to put in the work to get your home sold for free. This is especially true in a competitive market where agents might have a large pool of potential clients willing to pay the full fee. Sometimes, accepting a higher fee will entice the agent to work harder and get the home sold at a higher price, so it’s more of an investment than a sunk cost. But you have a few options if you’re adamant about reducing the fee.

hash-markWays to Negotiate a Lower Broke Fee in California

  1. Call the Brokerage
  2. Only Use the Agent for Specific Services
  3. Negotiate With the Buyer

1. Call the Brokerage

Most agents do not operate independently and often work under the umbrella of an existing brokerage with a set commission structure. In that instance, negotiating directly with the agent may be difficult because they may only have so much power to change the fee. Instead, you should consider contacting their firm and see if you can negotiate directly with the broker. You may need to offer them something to get them to accept a lower fee. But say you have several properties you’re looking to sell; you may be able to convince the broker to lower the commission in exchange for future business.

2. Only Use the Agent for Specific Services

Some agents will be willing to lower the commission if you only need them for certain tasks. For instance, if you can market the property and connect with buyers on your own but still need a professional to assist with negotiations and handle the closing, they may be willing to do so for a lower commission. Not all agents will be open to this type of arrangement, and it will require more work on your end. But it is a simple way to lower the fee if you need the extra cash.

3. Negotiate with the Buyer

Although there are many ways to negotiate with your own agent, dealing with the buyer’s agent is more challenging. Therefore, you’ll have to work something out with the buyer to lower their fee. It’s rare for a buyer to pay for their own agent out of pocket. But if you have some leverage in the deal, you may be able to work something out. For instance, if you know, they want to buy the home, and you have several other offers, you may get them to agree to a higher price or take care of some of your closing costs to cover the commission.

hash-markCalifornia Real Estate Commission Bottom Line

When you sell a home in California, you can almost always expect to spend some money on realtor commissions, whether it’s to pay for your own representation or the buyers. But remember that everything is negotiable, and there are always ways to lower the fee if you’re willing to be creative.

hash-markCalifornia Real Estate Commission FAQs

1. Does the Seller Pay Both Commissions in California?

Yes, the seller typically pays a commission for both their own agent and the buyers. However, it’s taken from the funds they receive for the sale of the house at closing. So technically, the check written by the buyer (or their lender) pays the commission, but it comes out of the seller’s profit.

2. What is the Average Real Estate Commission in California?

The average real estate commission in California is 5.14%. The median listing price for a home in California is $740,000, which means the average realtor fee paid by sellers in California is $38,036.