Courtesy of Redfin.

The average U.S. buyer’s agent commission rose significantly year over year in the third quarter after declining in the wake of the National Association of REALTORS® agreeing to change its commission rules in a March 2024 settlement, Redfin said.  

The increase brought the average commission from a low of 2.36% in Q3 2024 to 2.42% last quarter. That level was down one basis point from 2.43% in the preceding quarter. The low of 2.36% occurred when NAR implemented the change in August 2024.  

The rule change was part of a settlement in Sitzer/Burnett vs. NAR, which was brought by home sellers who argued the practice of having sellers pay commissions for both their real estate agents and buyer’s agents artificially inflated commissions. NAR agreed to prohibit posting buyer commissions on the MLS, require signed buyer’s broker agreements before any showings and pay $418 million in damages.  

Despite the initial drop in commissions, fears that the settlement would lead to a dramatic shakeup in agent compensation have not materialized. Buyer’s agents are now being paid at approximately their pre-settlement level thanks to a slowdown in home sales, which has given buyers more negotiating power, noted Redfin, which based its analysis on buyer’s agent commissions for closed home sales. 

Commissions were mixed across home-price levels, with agents in transactions of $500,000 or less seeing the highest commissions as a percentage of deal value. Buyer’s commissions in this bracket rose from 2.45% in third quarter 2024 to 2.52% last quarter, while they rose from 2.31% to 2.32% for transactions between $500,000 and $999,999 and slid from 2.24% to 2.22% for homes priced $1 million and up.  

Courtesy of Redfin.