See how a commission divides between the listing brokerage, the buyer's brokerage and each agent. Results update as you type, and the steps underneath show the same math an exam question expects.
Percent of the sale price.
The buyer's brokerage gets the other 50%. Use 100 if there's no cooperating broker.
The agent's percentage of the listing side. 70 means a 70/30 split.
The agent's percentage of the buyer side.
Results
Total commission
5% of $450,000.00
$22,500.00
Listing brokerage (gross)
2.5% of the price
$11,250.00
→ Listing agent
70% of the listing side
$7,875.00
→ Listing broker keeps
$3,375.00
Buyer's brokerage (gross)
2.5% of the price
$11,250.00
→ Buyer's agent
60% of the buyer side
$6,750.00
→ Buyer's broker keeps
$4,500.00
Sale price minus commission
Before the seller's other closing costs and loan payoff
$427,500.00
Worked steps
Exams often give you the agent's check and ask for the price. This uses the rate and splits entered above.
Commission questions are multiplication in a chain. Find the total first, then take each share of it in the order the question gives them. Most mistakes come from skipping a step, such as applying the agent's split to the whole commission instead of to their brokerage's side.
Example
A home sells for $450,000. The commission is 5%, split 50/50 between the listing and buyer's brokerages. The listing agent is on a 70/30 split with her broker. How much does the listing agent earn?
Working backward.If the question gives you the agent's check and asks for the price, divide by the same percentages multiplied together: $7,875 ÷ (0.05 × 0.50 × 0.70) = $7,875 ÷ 0.0175 = $450,000. Check your answer by running it forward again.
Seller's net. A seller who wants to walk away with a set amount after commission needs a price of net ÷ (1 − rate), not net plus 5%. To net $427,500 after a 5% commission: $427,500 ÷ 0.95 = $450,000. Adding 5% to $427,500 gives $448,875, which comes up short.
Commission rates and splits are whatever the client, the brokerages and the agents agree to. The numbers in these examples are only for practice.
Multiply the sale price by the commission rate. A $450,000 sale at 5% is $450,000 × 0.05 = $22,500. That total is then divided between the listing brokerage and the buyer's brokerage, and each brokerage splits its part with its agent.
Work from the top down. First split the total between the two brokerages (for example 50/50). Then apply each agent's split with their own broker. With a $22,500 commission split 50/50, each side gets $11,250; a listing agent on a 70/30 split earns $11,250 × 0.70 = $7,875 and the broker keeps $3,375.
Divide the agent's commission by every percentage that led to it, multiplied together. If an agent earned $7,875 at a 5% rate, a 50% side share and a 70% split, the price is $7,875 ÷ (0.05 × 0.50 × 0.70) = $450,000.
Subtract the commission from the price: $450,000 − $22,500 = $427,500, before the seller's other costs and loan payoff. To find the price a seller needs to net a set amount, divide by 1 minus the rate: to net $427,500 after a 5% commission, the price is $427,500 ÷ 0.95 = $450,000.
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