1. What is Realtor Commission?

Realtor commission is the fee paid to real estate agents for their services in facilitating the sale or purchase of a property. It is typically calculated as a percentage of the final sale price and ranges from 5% to 6% of the property's selling price.

2. How Does the Calculator Work?

The calculator uses the commission formula:

Where:

• \( Commission \) — Real estate agent fee (USD)
• \( Sale\ Price \) — Final selling price of the property (USD)
• \( Rate \) — Commission percentage (5-6%)

Explanation: The commission is directly proportional to the sale price, with the rate typically negotiated between the seller and the real estate agent.

3. Importance of Commission Calculation

Details: Accurate commission calculation helps sellers understand their net proceeds from a property sale and allows buyers to budget for potential agent fees when purchasing through representation.

4. Using the Calculator

Tips: Enter the sale price in USD and commission rate as a percentage between 5% and 6%. All values must be valid (sale price > 0, rate between 5-6).

5. Frequently Asked Questions (FAQ)

Q1: Is the commission rate always 5-6%?
A: While 5-6% is standard, commission rates can be negotiated and may vary based on the property type, location, and market conditions.

Q2: Who pays the realtor commission?
A: Typically, the seller pays the commission, which is then split between the listing agent and the buyer's agent.

Q3: Can commission rates be lower than 5%?
A: Yes, some discount brokers or flat-fee services may offer lower rates, but they may provide fewer services.

Q4: Is commission included in the sale price?
A: The commission is deducted from the sale proceeds, so sellers should factor this into their net profit calculations.

Q5: Are there additional fees besides commission?
A: Yes, there may be additional closing costs, administrative fees, and marketing expenses that are separate from the commission.