The amount a eal estate agent earns on a sale is usually included in the cost of selling a home. For example, if a home sells for $750,000, the commission for that agent would be $8,000, leaving a balance of $48,000 for both parties. In some cases, however, the commission is not even, with the realtor retaining an 8% commission on the first $100,000 of the sale, while retaining only 4% on the remainder. In these cases, it is possible to break up the commission rate into two parts, each of which is added together to calculate the final percentage of the sale.
Real estate commissions are often calculated by dividing the total price of a home by the commission percentage of the agent. To figure out the actual amount of the commission for a real estate agent, multiply the gross price by the percentage. The commission will be 5% of the total purchase price, so a commission of $5,000 for a $100,000 home would be $5,100 for an agent. The commission percentage is based on the contract between the agent and the seller, and the commission percentage will vary depending on the state in which the property is located.
Real estate agents also receive commissions from the sellers of a home. The commission for a $4 million home may be as high as six percent or even eight percent, depending on the state. In some states, home sellers can choose to list their homes on their own, which can reduce competition, but lower showings and profits. Another option is to list the home yourself, and pay the agent directly. Remember that it is better to get maximum exposure for a property than pay a high commission for it.