How sellers can negotiate real estate agent commissions

Key takeaways

• A real estate listing fee is the commission paid to your listing agent at closing, typically 2.5% to 3% of the sale price, and it is the largest single cost most sellers face.
• Since the 2024 National Association of Realtors settlement took effect, buyer agent compensation is no longer advertised in multiple listing service listings, making the listing fee and any buyer agent offer two separate decisions for sellers.
• Commission rates are not set by law and can be negotiated before you sign a listing agreement, but a lower rate may mean fewer marketing services or less agent involvement.

A real estate listing fee is one of the largest costs a seller will pay when selling a home. It covers the services a listing agent provides, from pricing and marketing the property to negotiating offers and managing the transaction through closing. Because the fee is typically calculated as a percentage of the sale price, it scales with the value of the home.
Since a 2024 National Association of Realtors legal settlement changed how commissions are structured, sellers have more reason than ever to understand what they are paying for and how these fees work. This article explains what a listing fee is, how it differs from the total commission, what services it covers and what changed after the settlement.

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A real estate listing fee is the commission a seller pays to their listing agent for marketing and selling the home. It is calculated as a percentage of the final sale price and is paid at closing, where it is deducted from the seller's proceeds before the remaining funds are disbursed.

The listing fee covers a defined set of services, from entering the property into the multiple listing service (MLS) to managing showings, negotiating offers and coordinating the closing process. The specifics vary by agent and brokerage, which is why sellers should ask what is included before signing a contract.

If the home does not sell during the listing agreement period, the seller generally does not owe a listing fee. The fee is tied to a successful transaction, not to the act of listing itself.

The listing fee is not the same as the total commission. The distinction matters, and it matters more now than it did before 2024.

Related content:

• What is a listing agreement? Types, terms and seller obligations.

The listing fee is one part of the total commission paid in a real estate transaction. Historically, the total commission ranged from 5% to 6% of the sale price and was split roughly evenly between the listing agent and the buyer's agent. The seller paid the full amount, with both portions bundled together and advertised in the MLS listing.

That structure changed on August 17, 2024, when the NAR settlement took effect. Under the new rules, buyer agent compensation can no longer be advertised in MLS listings. Sellers may still choose to offer compensation to a buyer's agent, but that offer must be negotiated separately, outside the MLS.

What this means in practice: The listing fee and any buyer agent compensation are now treated as distinct costs. Sellers should understand each one on its own terms rather than viewing them as a single bundled number.

To put the dollars in perspective, consider a home selling at $434,000 (close to the national median existing-home sales price of $434,100 in July 2026, according to the National Association of Realtors). At a 3% listing fee, the listing agent's portion would be about $13,020. If the seller also offered 2.5% to the buyer's agent, that would add roughly $10,850, bringing the total commission to approximately $23,870. But those two numbers are now negotiated and agreed to in separate steps.

The listing fee pays for the agent's time, expertise and out-of-pocket costs in getting your home sold. The specific services can vary by agent, brokerage and market, but they generally include:

• Pricing strategy. A comparative market analysis (CMA) to determine a competitive listing price based on recent sales of similar homes in your area.
• MLS listing. Entering your property into the multiple listing service, which distributes it to real estate websites and makes it visible to buyer agents and buyers searching online.
• Professional photography and media. High-quality photos, virtual tours, video walkthroughs and, in some cases, drone footage. The quality of listing photos directly affects how much interest a property generates online.
• Marketing. Online advertising, social media promotion, print materials such as brochures and flyers, yard signage and, depending on the agent, targeted digital campaigns.
• Staging consultation. Advice on how to present your home for showings. Some agents include a professional stager or cover part of the staging cost; others offer guidance only.
• Showings and open houses. Scheduling, coordinating and managing buyer visits, including communicating with buyer agents and collecting feedback after each showing.
• Offer negotiation. Reviewing incoming offers, advising you on terms and counteroffers, and negotiating on your behalf. For more on this step, see how to handle offers on your house.
• Contract and closing management. Handling the paperwork from accepted offer through closing, coordinating with the title company, the buyer's agent and the lender, and guiding you through each required step.

Not every agent includes the same level of service at the same rate. Before signing a listing agreement, ask your agent for a written breakdown of what is and is not included in their quoted commission.
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Yes. Commission rates are not set by law and can be discussed between the seller and the agent before signing a listing agreement. The NAR settlement reinforced that commissions have always been, and remain, fully negotiable.

"They're negotiable, so I really can't tell you where they are," said Melvin A. Vieira Jr., who represents buyers and sellers through Re/Max Real Estate Center in Boston, Massachusetts. "There's no set rate and there never has been."

A National Association of Realtors spokesperson confirmed that "listing agents must clearly disclose in writing to the seller that compensation is fully negotiable and not set by law and obtain the seller's approval for any payment or offer of payment that will be made to another agent acting for buyers."

Several factors can affect your ability to negotiate:

• Local market conditions. In a market where homes are selling quickly, agents may accept a lower rate because they will spend less time and fewer resources marketing the property. In a slower market, agents may be less flexible. Vieira said the pace of the market does not change the work involved. "Every agent knows what they're worth," he said. "It does not matter to me whether it's a fast or slow market. In a fast market, I do the same things quicker."
• Home price. On higher-priced homes, some agents will agree to a lower percentage because the dollar amount of the commission is still substantial. A 2.5% fee on a $700,000 home is $17,500, compared to $10,850 on a $434,000 home.
• Level of service. If you are willing to handle some tasks yourself (for example, your own staging or photography), an agent may reduce the rate. Conversely, a full-service package with professional staging, drone photography and targeted advertising may command a higher fee. "There are agents who say, 'I'll do this for this.' That's called negotiating," Vieira said. "There's no harm in saying that. But sellers should not think that by using AI and Google, they can do everything an agent can do."
• Repeat or referral business. Sellers who are also buying through the same agent, or who can provide referrals, may have more leverage.

One important caveat: A lower commission may mean fewer services, less marketing investment or less time dedicated to your listing. Sellers should weigh cost against the value the agent provides. The cheapest option is not always the best outcome if it results in a lower sale price or a longer time on the market.

The NAR settlement changed several practices around real estate commissions. The changes affect both sellers and buyers.

Before August 2024, the listing agent typically advertised the buyer agent's commission in the MLS as part of the listing. The seller paid both sides, and the total amount was agreed to in the listing agreement. This bundled structure meant many sellers did not think separately about what they were paying their own agent versus what they were paying the buyer's agent.

Under the new rules:

• MLS listings can no longer include offers of buyer agent compensation. If a seller wants to offer compensation to a buyer's agent, that offer must be communicated outside the MLS, through direct negotiation or a separate agreement. According to the NAR, that offer "can be shared through common marketing methods such as fliers, signs, brokerage websites, social media posts, or simply through a phone call or email."
• Sellers can still offer buyer concessions on the MLS (for example, a credit toward the buyer's closing costs), but these are distinct from agent compensation.
• The listing agreement should clearly spell out what the seller is paying and to whom. This includes the listing agent's fee and, if the seller chooses to offer buyer agent compensation, the amount and terms of that offer.

The NAR also prohibits the practice of "steering buyers based on the amount of broker compensation." Sellers should be informed about their rights and industry policies regarding how their home is marketed, so they are not pressured into offering compensation to a buyer's agent if they choose not to.Sellers should discuss with their agent whether offering buyer agent compensation makes strategic sense in their market. In many areas, offering some form of buyer-side compensation can attract more buyers and potentially lead to a faster sale or stronger offers. In others, it may be less common.

Buyers are now required to sign a written buyer-broker agreement before touring homes. This agreement specifies how the buyer's agent will be compensated, whether by the buyer directly, through a seller concession or through a separate arrangement. The agreement must state the amount or rate of compensation upfront.

This change makes the cost of a buyer's agent more visible. Buyers who previously assumed their agent's services were "free" now see the fee spelled out before they begin their home search.

Some states allow what is known as dual agency, when a single agent represents both the seller and the buyer in the same transaction. Because only one agent is involved, the seller may pay a lower total commission rather than separate fees to two agents.

This could be an option when a buyer has not signed a contract with an agent. However, some real estate industry experts argue that dual agency can present a conflict of interest. If a problem arises during the transaction, the agent may not be able to give full representation to either party because of the divided role. Sellers considering dual agency should understand the limitations and check whether their state permits it.

There are several practical ways to manage what you spend on real estate listing fees without sacrificing the quality of your sale:

• Interview multiple agents. Compare commission rates, service packages and marketing plans from at least two or three agents before choosing one.
• Negotiate before signing. The commission rate is set in the listing agreement. Once you sign, it is harder to change. Discuss your expectations before the contract is finalized.
• Ask for a service breakdown. Request a written list of what is included at the quoted rate. This makes it easier to compare agents and to identify services you might not need.
• Evaluate the buyer agent offer separately. Because the listing fee and buyer agent compensation are now distinct, you can make a separate, informed decision about each. Your agent can advise on what buyer-side compensation is common in your local market.
• Understand the tradeoffs of discount services. Flat-fee or discount brokerages may charge less, but they often provide fewer services, such as limited marketing, fewer showings or less negotiation support. "You pay for what you get," Vieira said. "Do your homework as a seller and figure out if this agent is worth what you're going to pay them."
• Leverage market conditions. If your home is in a market where properties are selling quickly and inventory is low, you may have more leverage to negotiate a lower rate.

For a step-by-step overview of the full selling process, see selling a home in 10 steps.