When the National Association of Realtors agreed last year to change its commission rules, some industry observers predicted a doomsday scenario. The trade group’s landmark settlement over allegations from homebuyers set off forecasts that buyer agent commissions could be slashed in half.
But the reality under the news rules is coming into focus, and brokers in different price ranges are facing different changes.
That’s according to an analysis from listings platform and brokerage Redfin, which looked at its buyer agent commission rates for closed home sales across the country following NAR’s rule changes enacted in August.
Agents representing buyers of $1 million-plus homes across the U.S. have seen their average commission rate soften.
In the first quarter, the average buyer’s agent commission on $1 million-plus properties was 2.17 percent – flat from the quarter before but down from 2.22 percent from the third quarter of 2024, when NAR’s rules went into effect.
Compared to the same time last year, when the rules were announced, the average commission rate on luxury home sales was down from 2.3 percent.
But it’s a different story for properties that sold under $500,000. The average rate grew slightly to 2.49 percent: up 3 basis points from the quarter before, 7 basis points from the third quarter of 2024 and 1 basis point year over year.
For middle-market homes — those priced between $500,000 to $999,999 — the growth was more modest: the average commission rate was 2.29 percent. This was 3 basis points higher than the quarter before and 2 basis points from the third quarter of 2024. However, year over year, this rate was down from 2.34 percent.
Across all home sales, the average buyer’s agent commission rate ticked down just 30 basis points to 2.4 percent compared to the same time last year. However, commission rates were a hair higher compared to the third and fourth quarters of 2024, when the average rates were 2.36 percent and 2.37 percent, respectively.
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