What is it?
In most real estate transactions, the commission is a percentage of the purchase price paid to the agents involved. Contrary to popular belief, there is no set or standard commission, and every agent has the right to set their own on an individual or transaction-level basis. Even publicly discussing or mentioning a standard commission rate violates the law, as it could be considered price fixing.
Who Pays It?
In a typical transaction, a seller pays their agent’s commission, and sets aside a negotiated percentage for the buyer’s agent. This split is disbursed at the end of the transaction based on cooperative agreements between the brokerages and the MLS, as well as the agent’s agreement with their brokerage.