If it's been a couple of years since you last sold a house, some things have changed. Specifically, the way buyer's agent fees are handled looks different from how it used to, and there's a lot of confusion out there about what that actually means for sellers.

What changed in August 2024? Before the change, there was a spot on the listing forms where the seller's agent would record the exact amount of the buyer's agent fee. That fee was then posted on the MLS for all agents to see. 

The NAR class-action settlement determined that this practice could lead to unethical behavior because if one listing offered a higher commission than another, agents could be incentivized to steer their clients toward the house that paid them more.

As of August 2024, that fee is no longer posted on the MLS. The buyer's agent compensation is now handled as part of the offer negotiation, not pre-set on the listing.

Sellers are still paying in almost every deal. We recently hosted a panel featuring four other top-producing agents in the Sacramento region. Across the five of us, there were over a thousand transactions represented in our local market. Someone from the audience asked how often buyers pay their own agent's fee versus the seller still covering it. 

Out of a thousand transactions, one involved the buyer paying the buyer's agent fee. Is it possible for the buyer to pay? Yes. Is it likely? Based on what we're seeing, no. Sellers are still covering this cost in the overwhelming majority of transactions in Greater Sacramento.

"Out of a thousand local transactions, only one buyer paid their own agent's fee."

Budget around 2.5% on average. The next question sellers usually ask is how much they should plan for. On average, we're seeing buyer's agent fees come in around 2.5%. It can be less. We recently represented a seller and negotiated the buyer's agent fee down to 1.5%. It can also be more. 

We put a home in escrow for nearly $2 million recently, and the buyer's agent would not take anything less than 3%, which came out to $60,000 that the seller paid to the buyer's agent. The range varies, but 2.5% is a solid number to budget around when planning your net proceeds.

How it plays out in practice. When your home goes live, and a buyer presents an offer, the offer now includes the amount the buyer's agent is requesting as compensation. If there are multiple offers on the table and one agent is asking for a higher commission than the rest, but the overall offer nets you more money, you might be willing to pay a little more to access that buyer. 

If the numbers don't make sense, you negotiate. The buyer's agent can reduce their fee, the buyer can increase their purchase price, or both. The fee is now fully part of the negotiation process, and a good listing agent will help you evaluate every offer with the full picture in mind.

This is a national change, not just local. Everything we've described here happened across the country, not just in Sacramento. The rules are the same everywhere, though how they play out in practice may vary by market. What we're seeing locally is that sellers are still responsible for this cost in nearly every transaction, and the fee is now negotiated deal by deal rather than pre-set on the MLS.

If you're curious about what this would look like in your specific situation, we have a tool that shows you exactly what your net proceeds would be, factoring in agent fees, property taxes, and more. Reach out to us, and we'll run those numbers for you. Call or text us at (855) 935-6673 or email us at [email protected]. You can also visit made4morerealty.com for more. Just expect more and get more with Made4More Realty.