How do real estate commissions actually work now?
Answered by Chris Deutsch, Founder & Editor
Licensed Minnesota Realtor #20382264 ·
The short answer
Everything is negotiated, in writing, up front. That's the whole system since the 2024 settlement changes. Sellers negotiate their listing agent's fee in the listing agreement. Buyers agree to their agent's fee in the buyer representation agreement, before touring. Neither number comes from a rulebook.
On stage The 60-second answer
Captions on · Transcript below
The stage is set.
Chris's video answer is on its way. Until then, the short answer above says the same thing.
The transcript posts with the video.
The longer answer
What changed in practice: offers of buyer-agent compensation no longer appear on the MLS. Whether a seller helps cover the buyer's side gets negotiated in the offer itself, like price or closing date. Sellers often still do — it widens the pool of buyers who can make the deal work.
What didn't change: there's no standard rate, and there never legally was. Anyone who quotes one as fixed is wrong by definition. When we talk, you'll see my number and the reasoning behind it in writing. Grab coffee and ask me anything.
The next department over
What people in this spot usually ask next.
- Rules & representationWho pays my buyer's agent now?Read the answer
- Rules & representationWhat actually changed after the NAR settlement?Read the answer
- Rules & representationDo I really have to sign something before an agent can show me homes in Minnesota?Read the answer
- Rules & representationI signed a buyer representation agreement and it's not working out. Can I get out of it?Read the answer
- The banned-term explainersI keep hearing about "shadow inventory." Should I wait for it to hit the market?Read the answer
- Investment propertiesAre real estate commissions negotiable in Minneapolis?Read the answer
From the editor's desk
“As Founder and Editor, I review, correct, and stand behind every answer.”
Is your situation more specific than the market? That's the one worth talking through.