Confused about how real estate commissions work after the 2024 changes? You’re not alone—here’s a clear, practical explanation.
The real estate industry underwent a significant change in 2024 following a major antitrust ruling involving the National Association of Realtors and several large brokerages.
The most important takeaway for buyers and sellers is simple:
Real estate commissions are now fully negotiable and more transparent than ever.
How It Worked Before
Traditionally, the seller paid the full real estate commission.
That commission was typically split between:
• The listing agent (representing the seller)
• The buyer’s agent (representing the buyer)
How It Works Now
Under the new rules:
• Buyers are responsible for compensating their own agent
• Sellers are no longer required to offer compensation to a buyer’s agent
However, this is where clarity matters:
Sellers can still choose to offer compensation or credits to buyers.
What This Means in Practice
In most real-world transactions, the structure still functions very similar to the past.
For example:
A seller lists a $1.5M home and agrees to:
• Pay a 2.5% listing fee
• Offer a 2.5% credit to the buyer at closing
The buyer can then use that credit to compensate their agent.
Result:
The economics are effectively the same, the process is simply structured differently.
Why This Matters for Sellers
From a practical standpoint, offering compensation (directly or indirectly) to a buyer’s agent often:
• Increases exposure to qualified buyers
• Encourages agent participation
• Supports stronger pricing outcomes
In simple terms:
More motivated buyers and agents typically lead to better results.
My Approach
As an independent broker, my fee structure for representing Buyers has always been transparent and negotiable.
• 3% for properties under $1M
• 2.5% for properties between $1M–$2M
• 2% for properties above $2M
A Simple Way to Think About It
Real estate commissions are best viewed as a success-based fee.
You only pay for a successful transaction:
• Where you purchase a property
• At a price you agree to
• With full transparency into the dollar disbursements and distributions to all parties
The Bigger Picture
The U.S. real estate system—particularly the MLS—remains one of the most effective marketing platforms in the world.
It creates a competitive environment where:
• Thousands of agents
• And millions of potential buyers
are exposed to your property almost instantly.
That level of exposure is a key driver in achieving the highest possible market price.
Final Thought
While the structure of fees has evolved, the underlying principle has not:
Well-positioned properties, properly marketed, in a competitive environment—produce the best outcomes.
If you have questions about how this applies to your situation, feel free to reach out.
Brent Leathwood
Licensed Real Estate Broker
941-882-2995
Brent@BrentLeathwood.com
