Do Home Buyers Pay Agent Fees?

In a real estate transaction, it’s customary for the seller to pay the commissions of both their listing agent and the buyer’s agent.

Tom Monaghan
Tom Monaghan

Who pays the agent fees in a real estate transaction?

There are many expenses that come along with buying a home, and it’s important for buyers to understand their financial responsibilities before they enter a deal with a seller.

Besides the funds being invested in purchasing the property, the home-buying transaction incurs many additional costs.

The buyers and sellers are responsible for paying the fees charged by the different professionals who have a hand in moving their deal to the closing table.

In any real estate deal, the real estate agents serve as the central service providers in the transaction. But, who pays their fees? How do agents charge their clients, and when do the payments happen?

How Do Agent Fees Work?

While the buyer and seller can hire their own real estate agents, the agent fees are actually bundled together.

Any agent fees are clearly articulated in the closing disclosure.

The buyer’s agent and the seller’s agent are both paid for their services in a single lump sum at closing unless otherwise agreed upon by all parties.

Rather than looking at it like two separate service providers charging their own fees, real estate agents are best viewed as two professionals who are working together to assist both the buyer and seller achieve mutually beneficial goals.

Who Pays the Agent Fees?

Many buyers do not know that the agent fees of both agents are bundled together and paid as a single payout by the clients.

So, if the buyer and seller fees are paid by one party of the transaction, who pays? Is it the buyer, or the seller?

Traditionally, the seller is responsible for paying the agent fees.

This means that the buyer is not usually required to pay their agent’s fees, as the seller pays both the listing and the buyer’s agent.

The seller is able to use the funds gained from the sale to pay the agent fees, covering the costs of both agents who assisted in the transaction. The seller usually pays the agent commissions because they are the ones walking away from the deal with a profit.

The buyer is the one facilitating the transaction by investing in the property purchase, so it’s customary in most markets for the seller to take on the agent fees.

However, it is possible for buyers to offer to pay part or all of the agent fees. This may be negotiated as a special clause in the purchasing agreement. Or, it may be leveraged in a highly competitive market to encourage a seller to make a deal with a buyer.

How Much Do Agents Charge for their Services?

Each agent sets their own commission rate, so the exact amount charged for the service depends on the agent that you work with.

While averages exist, each agent has a different expectation and might be open to negotiating.

Generally, the commission for both agents equals 5% to 6% of the total sale price of the home.

To get a dollar amount estimate of this commission, 5% of September 2022’s median sales price of $384,800 equals $19,240. 6% of the same amount equals $23,088.

Each agent involved in the deal usually walks away with 2.5% to 3% of the sale price. Looking at the above agent commission calculations based on September 2022’s median sales price of a home, each agent would receive between $9,620 and $11,544.

In some cases when otherwise negotiated, the commission total is not split evenly — but these details vary by agents and circumstances.  

A Closer Look at Real Estate Closing Fees for Buyers and Sellers

The agent fees are included in the closing costs that the seller pays to finalize their transaction. Other common closing costs that sellers are responsible for include:

  • Title transfer taxes
  • Title recording fees
  • Attorney fees
Review all closing documents closely and keep copies for your records.

Just because the buyers do not pay the real estate agent commissions does not mean they don’t have to pay other closing costs. Buyer closing costs typically include:

  • Appraisal fees
  • Notary fees
  • Wire fees
  • Attorney fees
  • Recording fees
  • Home inspection costs
  • Lender fees

Whether you’re a buyer or a seller, it’s important to be ready to cover the expenses incurred by your transaction.

If you work with a market-leading agent, they will help to make sure that you’re fully prepared to make these payments when they are due. Your perfect agent will guide you through every step of the deal, ensuring that you have the budget required to cover the costs of the transaction.

To learn more about how real estate transactions work, explore more educational blogs by

Tom Monaghan

Tom Monaghan