Real estate commission is often the single largest expense in a home sale, yet many sellers never really understand what they’re paying or why. Whether you’re selling a $400,000 home or a $1 million property, the commission structure can dramatically impact your net proceeds. Let’s break down the real numbers and explore how much you can actually save.
Understanding Real Estate Commission
Real estate commission isn’t a fixed percentage set by law or regulation. Instead, it’s negotiable between sellers and their agents, typically ranging from 4-6% of the final sale price. In a $500,000 home sale with a 6% commission, you’d pay $30,000 out of pocket. With a 4% commission, you’d pay $20,000. That’s a $10,000 difference on a single transaction.
Here’s how traditional commission typically works:
The Commission Breakdown: Where Your Money Goes
Let’s use a practical example of a $400,000 home sale with a standard 6% commission (the national average):
Total Commission: $24,000
But wait—there’s more. This commission is split between the agent and their brokerage:
Hidden Costs Beyond Commission
While commission is the biggest expense, it’s not the only one. According to the National Association of Realtors, sellers typically incur these additional costs:
Closing Costs (2-5% of sale price): $8,000-$20,000
Home Repairs and Staging (if selling traditionally): $5,000-$15,000
Property Taxes and HOA Fees: Variable
Total Potential Costs: $37,000-$47,000 on a $400,000 sale
This represents nearly 10% of your selling price going to various expenses and fees.
How Much Can You Actually Save?
The answer depends on which selling method you choose. Let’s compare:
Traditional Real Estate Sale (with full 6% commission):
Alternative: Cash Sale with Seller Select
Real Savings Analysis:
Negotiating Commission: What You Can Do
If you prefer a traditional sale, negotiating commission is your best strategy to reduce costs:
2. Interview Multiple Agents
Don’t accept the first rate offered. Different agents and brokerages have different standards. Some discount-focused brokerages offer lower commissions (4-4.5%) in exchange for more limited marketing services.
3. Propose Tiered Commission
Negotiate a higher commission if the agent sells quickly (e.g., under 30 days) versus a lower commission if it takes longer than 60 days. This incentivizes faster sales.
4. Bundle with Other Services
If you also need buyer’s agent services for your next property purchase, leverage that into better seller commission terms.
5. Understand What You’re Paying For
Get a detailed breakdown of what marketing and services your agent will provide. Some charge more, so make sure you’re getting the added value.
The Hidden Advantage of Seller Select
When you accept a cash offer through Seller Select, you eliminate several cost categories entirely:
No Commission: Save $20,000-$24,000
No Repairs Required: Save $5,000-$15,000
Minimal Staging: Save $2,000-$5,000
Faster Closing: Save on extended property taxes and holding costs
Certainty: No risk of deal falling through after months of market time
For many sellers, especially those facing time pressure or holding properties in less desirable condition, these savings add up to more than the discount from market-value pricing.
Breaking Down the Real Math
Let’s illustrate with actual numbers:
Scenario 1: Your home is worth $400,000 on the traditional market
Scenario 2: Same home sold via cash offer
Difference: -$22,000 in exchange for 6-8 weeks of your time and avoiding uncertain market conditions.
But if your home sells at $380,000 on the market (15% lower than optimistic listing price):
In this scenario, the cash offer ($336,000) is nearly equal to the traditional sale net proceeds ($341,200), but you save 2-3 months of stress and uncertainty.
Questions to Ask Your Real Estate Agent
If you’re pursuing a traditional sale, here are critical questions to ask:
The Bottom Line
Commission costs can easily consume $20,000-$25,000 of your proceeds on a typical home sale. When combined with closing costs and repairs, sellers often net significantly less than they expect.
Whether you pursue a traditional sale and negotiate aggressively, or explore alternative options like cash offers through Seller Select, the key is understanding these costs before committing to a selling strategy.
At Seller Select, we believe every seller deserves to understand exactly where their money goes. Our cash offer approach eliminates commission entirely, giving you maximum transparency and control over your sale proceeds.
Ready to see what your home could net with a commission-free option? Get your free evaluation today.
About the Author:
Tony Fletcher is the Founder of Seller Select and brings 37+ years of real estate experience to every seller consultation. With over 1,100 successful property flips and thousands of homes sold throughout his career, Tony understands every cost component of home sales. As the Broker of Record and Director of Growth at Big Block Realty Premier in Orange County, Tony is committed to helping sellers maximize their net proceeds.
LinkedIn: linkedin.com/in/flutie3333
Published: January 24, 2026 | Word Count: 1,920 | Reading Time: 8 minutes
Meta Title: Home Selling Commission: How Much Can You Save?
Meta Description: Understand real estate commission costs and discover ways to save $10,000-$25,000 on your home sale. Expert analysis from Tony Fletcher, founder of Seller Select.
