It’s a question we get all of the time — and it’s a great question! Because, did you know that we don’t get paid to show homes?

At least not up front.

In fact, we don’t get paid until the keys have been given to the new homeowners and the funds have been dispersed!

We show up for you and commit to you as your agent without a paycheck! But, that doesn’t mean we aren’t going to work our butt off to help you find a home that you love or sell your current home!

While there are special circumstances, most Real Estate Agents are 1099 employees who work 100% on commission. So who pays the commission?

Buyers Agents 

The agent representing the buyer is referred to as the Buyers Agent or Selling Agent, simple enough right? They are paid from the sellers proceeds after closing. There is no standard percentage, and this number will vary property to property. 

This means that in the majority of transactions the buyer does not pay the buyer’s agent outside of the purchase price or their loan amount! However, there are cases where a seller will not assist with paying commission, like if you purchase a for sale by owner home, so be aware that the North Carolina Buyer’s Agency Agreement does state that the buyers agent will be paid a certain percentage, possibly by the buyers should the seller refuse. If you are about to see a home where the seller will not pay, your Realtor should let you know prior to seeing the home. And trust us, we are very upfront with this and ensure our clients are aware of this added expense prior to even going to tour the home.

At the end of the day buyers agents work hard, especially in this market, and deserve to paid accordingly. If you do choose to purchase a FSBO, just know that using a buyers agent will probably save you money in the long run and a good buyers agent is worth every penny!

Listing Agents

The listing agent is the agent that is representing the sellers in the transaction. They are paid by the sellers at closing. The amount they are paid is negotiated between the agent and the sellers. There is no standard amount, but don’t be surprised if the agent’s brokerage requires a certain minimum percentage to be charged. This is to make sure there is enough money to pay everyone involved fairly for their hard work!  

This commission is then split between both agents in the transaction. 

Here’s an example: 

The seller and listing agent agree upon a 6% commission. They agreed to pay the buyers agent 2.4% leaving 3.6% for the listing agent. They close on the property for $200,000. 

Buyer side – $200,000 x 2.4% = $4,800

Seller side – $200,000 x 3.6% = $7,200

Keep in mind that these numbers do not include the portion that goes to each agent’s firms, taxes which are not taken out, and the overall costs of doing business and marketing the home. Real Estate Agents also only get paid when they close on a property, so none of their work is compensated until the end of the transaction.

Have more questions on this? Send us a DM or email!