Real Estate Commissions in California After the 2024 Changes

If you list your house with an agent, the commission will probably be your largest cost of selling. The way agents get paid changed in August 2024, and California added rules of its own in 2025. Here’s what changed, what sellers are paying now and what you can negotiate before you sign a listing agreement.

What changed on August 17, 2024

The National Association of Realtors settled lawsuits brought on behalf of home sellers over broker commissions, and the settlement’s practice changes took effect on August 17, 2024. Two of them matter most to sellers.

Listings on a multiple listing service (MLS) can no longer include an offer to pay the buyer’s agent. A seller can still offer to pay the buyer’s agent outside the MLS, and a listing can still advertise concessions to buyers, such as help with their closing costs.
Agents who work with buyers through an MLS must sign a written agreement with the buyer before touring a home. The agreement has to state the agent’s pay as a specific amount or rate, not something open-ended. The agent can’t collect more than that from any source, and the agreement must say plainly that fees are fully negotiable and not set by law.

The practical result is that the buyer’s agent’s pay is now set first in the buyer’s own agreement. Whether the seller contributes to it is a separate question, settled in the listing agreement or the purchase contract.

California’s rules for buyer agreements

California added its own requirement on January 1, 2025. Under Civil Code §1670.50, a buyer and the buyer’s agent must sign a written representation agreement as soon as practicable and no later than when the buyer makes an offer. It has to cover the agent’s compensation, the services, when payment is due and how the agreement ends. For individual buyers, it can last no more than three months and can’t renew automatically.

For a seller, that means a buyer who makes an offer through an agent has already agreed in writing to what that agent will be paid. The offer may ask you to pay part or all of it. You can accept, decline or counter, just as you would on the price.

Commissions are negotiable

No law sets real estate commissions. California requires listing agreement forms for homes of one to four units to say, in bold type, that the amount or rate of commissions “is not fixed by law” and may be negotiated between the seller and the broker. The rate can’t be printed on the form in advance; it’s filled in for your sale.

What you can negotiate:

The listing agent’s fee, as a percentage or a flat amount
Whether you’ll contribute to the buyer’s agent’s fee, and how much
What happens if your agent also represents the buyer
How long the listing lasts and how you can end it

What sellers are paying now

Commission rates aren’t published in one place, so the best evidence comes from brokerages that report them and from surveys of agents.

Anywhere Real Estate, whose brands include Coldwell Banker, Century 21 and Sotheby’s International Realty, reports its average commission per side of a sale in its SEC filings. For the first nine months of 2025, the average was 2.41% per side at its franchised brokerages and 2.37% at the brokerages it owns, nearly unchanged from 2.42% and 2.37% a year earlier. Two sides at those rates come to about 4.7%–4.8% of the price.
In an August 2026 survey of 434 agents by Clever Real Estate, agents put typical total commissions at 5.46% nationally and 5.08% in California, with the national figure split almost evenly between listing and buyer’s agents. Those are agents’ reports of typical rates in their area, not figures from closed sales.

Both sources point to a total near 5% when a seller pays both agents. On a $1 million home, each percentage point is $10,000, so a small difference in the rate is real money. The figure on your sale is whatever you agree to.

Should you offer to pay the buyer’s agent?

This is a pricing decision, and it’s worth talking through with your listing agent. Offering to cover some or all of the buyer’s agent’s fee can widen your pool of buyers, since a buyer who is stretching to cover a down payment and closing costs may not have cash left for an agent’s fee. Declining lowers your costs, but buyers may respond by offering less or asking for a credit.

You don’t have to decide everything up front. Each offer will say what the buyer is asking you to pay, and you can weigh it along with the price, the financing and the closing date.

Questions to ask before you sign a listing agreement

What is your fee, and is it a percentage or a flat amount?
What do you recommend I offer a buyer’s agent, if anything, and why?
Does your fee change if you also represent the buyer?
What’s included, such as photos, open houses and help with inspections and repairs?
How long does the listing last, and how can I end it early?
Will you put every fee in writing, including any flat transaction or administrative fee?

Get the answers in the written listing agreement, not just in conversation. If something in it doesn’t match what you were told, ask for it to be changed before you sign.

Selling without a commission

If paying commissions doesn’t make sense for your situation, you have a few other routes. You can sell the house yourself; our guide to for sale by owner in California covers how that works, including the choice of whether to pay a buyer’s agent. You can hire a flat-fee or discount broker for part of the work. Or you can sell directly to a buyer.

EZ Home Offer is a direct buyer: we’re real estate investors, not agents or brokers. You pay no commission, and we cover typical closing costs. The trade-off is that a cash offer is usually below what the house might bring on the open market after repairs and showings, so the commission savings is only one part of the comparison. Look at what you’d net each way, using our breakdown of seller closing costs in California, and see how a sale with us works if you want a firm number to compare.

Sources

General information about California rules as of October 3, 2026, not legal, tax or financial advice. Laws change and every situation is different, so check the details with an attorney, CPA or other professional.