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Short answer
Real estate commission = sale price × rate. A $400,000 sale at 3% is $12,000, and a 70/30 split leaves you $8,400 before any per-deal fees.
1. The formula
Gross commission = sale price × commission rate. Your take-home = gross × your split − per-deal fees.
2. Gross commission by price and rate
| Sale price | 2.5% | 3% | 5% | 6% |
|---|---|---|---|---|
| $300,000 | $7,500 | $9,000 | $15,000 | $18,000 |
| $400,000 | $10,000 | $12,000 | $20,000 | $24,000 |
| $500,000 | $12,500 | $15,000 | $25,000 | $30,000 |
| $750,000 | $18,750 | $22,500 | $37,500 | $45,000 |
3. Brokerage splits on $12,000
| Split | You keep | Brokerage keeps | After $500 fee |
|---|---|---|---|
| 50/50 | $6,000 | $6,000 | $5,500 |
| 60/40 | $7,200 | $4,800 | $6,700 |
| 70/30 | $8,400 | $3,600 | $7,900 |
| 80/20 | $9,600 | $2,400 | $9,100 |
| 90/10 | $10,800 | $1,200 | $10,300 |
4. Things to check
- Real estate commission rates are negotiable.
- Splits often improve as you reach production milestones, and some firms use caps or flat fees.
- Independent agents usually pay their own self-employment tax.
5. Reverse the calculation
To earn $60,000 a year at about $8,400 per $400,000 sale, you need about 7 sales of that size, since $60,000 ÷ $8,400 is 7.1.
6. Frequently asked questions
How is real estate commission calculated?expand_more
Sale price × commission rate, then your split. A $400,000 sale at 3% is $12,000 gross.
What is a 70/30 split?expand_more
You keep 70% of the gross commission and the brokerage keeps 30%.
Are real estate commission rates fixed?expand_more
No. They are negotiable between the parties.
How many sales do I need for $60,000?expand_more
About 7 sales of $400,000 at 3% on a 70/30 split with no fees.
7. Sources
- menu_bookeBay: Selling fees
- menu_bookPayPal: Business fees
- menu_bookIRS Publication 15 (Employer's Tax Guide)