Who pays realtor fees?


Quick Answer

The buyer could be considered as paying the realtor fees, because he buys the house. However, the seller also pays the fees, because they come from the home's equity, notes Investopedia. The brokers retain a percentage of the commission, and the agents are paid their share or the commission is split.

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Full Answer

Realtor fees, or commissions, are negotiable, come out of the house's sale proceeds and are set in the terms of the sales contract, according to Realtor.com. When the buyer and the seller each have their own agent, the commission is split between the two agents. Realtor fees are not additional expenses added to the home's purchase price. If the commission is set at five percent and the purchase price is $200,000, the commission is $10,000 and is divided in half if there are two agents involved. The seller usually pays the commission unless the buyer and seller agree to split the cost or the buyer agrees to pay the full amount. Commissions are paid to the agents' brokers, since licensed agents cannot act independently and cannot get paid directly. Realtor commissions may appear high, but a house can take weeks or months to sell, and not many sellers would want to pay an agent by the hour, adds Investopedia.

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