Realtor commission on house flipping
Vardhini K shipleyPro Member
Investor · CLEVELAND, OH · Member since 2025 · 3 posts · 4 votesRealtor commission on house flipping
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Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
6moQuote from @Matthew Bernal:
Welcome Val! The nervousness is completely normal every investor feels it on the first deal.
On commissions — since the NAR settlement last year this changed. Buyer agent commission is now negotiable and not automatically covered by the seller. In practice many sellers still offer it but you need to confirm upfront before touring. As an investor always ask what the seller is offering and negotiate from there.
For investment properties in Cleveland specifically, the financing side is just as important as the commission conversation making sure you have the right loan structure lined up before you make an offer puts you in a much stronger position.
Happy to walk you through what financing looks like on a first Cleveland investment property so you have that piece figured out alongside the agent commission question.
Are you looking at single family or small multifamily for your first deal?
13 Replies
- 6moAlfath AhmedBusiness MemberReal Estate Agent · Columbus, OH · Member since 2022 · 1k+ posts · 1k+ votes
Quote from @Vardhini K shipley:
Hello,
First time investor in cleveland, Ohio. I'm nervous as hell. Wanted to get y'all perspective as an investor, who is paying the realtor's commission of 3.5%? Is it the buyer or seller? Or is every situation is different? Please guide. Thank you- Val
You may have to pay more commission on off-market deals. But standard realtor commissions is negotiable but most agents charge 3% on the market.
ReafCo | Ahmed Group 536 Reviews - Investor · CLEVELAND, OH · Member since 2025 · 3 posts · 4 votes6mo
Im tracking MLS property for now as a first time investor.
- Investor · Austin, TX · Member since 2021 · 497 posts · 127 votes6mo
Welcome Val! The nervousness is completely normal every investor feels it on the first deal.
On commissions — since the NAR settlement last year this changed. Buyer agent commission is now negotiable and not automatically covered by the seller. In practice many sellers still offer it but you need to confirm upfront before touring. As an investor always ask what the seller is offering and negotiate from there.
For investment properties in Cleveland specifically, the financing side is just as important as the commission conversation making sure you have the right loan structure lined up before you make an offer puts you in a much stronger position.
Happy to walk you through what financing looks like on a first Cleveland investment property so you have that piece figured out alongside the agent commission question.
Are you looking at single family or small multifamily for your first deal?
- Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes6moHey just fyi commissions have been negotiable since around 1950, they were fixed prior to then but not since then. What the NAR lawsuit last year in 2025 changed was: 1. Buyers and their agents are now required to enter into an agency agreement before viewing properties together. 2. The commission amount that a seller is offering to a buyers agent can no longer be advertised in the MLS. There was (and apparently still is) a lot of confusion around this with many people, including people reporting on the lawsuit, for some reason thinking that commissions just became negotiable, but that is incorrect. Myself and many others have been negotiating commissions all along, since 1950 when that rule changed (well before my lifetime).
Quote from @Matthew Bernal:
Welcome Val! The nervousness is completely normal every investor feels it on the first deal.
On commissions — since the NAR settlement last year this changed. Buyer agent commission is now negotiable and not automatically covered by the seller. In practice many sellers still offer it but you need to confirm upfront before touring. As an investor always ask what the seller is offering and negotiate from there.
For investment properties in Cleveland specifically, the financing side is just as important as the commission conversation making sure you have the right loan structure lined up before you make an offer puts you in a much stronger position.
Happy to walk you through what financing looks like on a first Cleveland investment property so you have that piece figured out alongside the agent commission question.
Are you looking at single family or small multifamily for your first deal?
- Investor · Argyle, TX · Member since 2014 · 112 posts · 73 votes6mo
Quote from @Steve K.:
Hey just fyi commissions have been negotiable since around 1950, they were fixed prior to then but not since then. What the NAR lawsuit last year in 2025 changed was: 1. Buyers and their agents are now required to enter into an agency agreement before viewing properties together. 2. The commission amount that a seller is offering to a buyers agent can no longer be advertised in the MLS. There was (and apparently still is) a lot of confusion around this with many people, including people reporting on the lawsuit, for some reason thinking that commissions just became negotiable, but that is incorrect. Myself and many others have been negotiating commissions all along, since 1950 when that rule changed (well before my lifetime).Quote from @Matthew Bernal:
Welcome Val! The nervousness is completely normal every investor feels it on the first deal.
On commissions — since the NAR settlement last year this changed. Buyer agent commission is now negotiable and not automatically covered by the seller. In practice many sellers still offer it but you need to confirm upfront before touring. As an investor always ask what the seller is offering and negotiate from there.
For investment properties in Cleveland specifically, the financing side is just as important as the commission conversation making sure you have the right loan structure lined up before you make an offer puts you in a much stronger position.
Happy to walk you through what financing looks like on a first Cleveland investment property so you have that piece figured out alongside the agent commission question.
Are you looking at single family or small multifamily for your first deal?
Well said.
- 6moSam McCormackBusiness MemberReal Estate Agent · Cincinnati, OH/NKY · Member since 2021 · 1k+ posts · 833 votes
Quote from @Vardhini K shipley:
Hello,
First time investor in cleveland, Ohio. I'm nervous as hell. Wanted to get y'all perspective as an investor, who is paying the realtor's commission of 3.5%? Is it the buyer or seller? Or is every situation is different? Please guide. Thank you- Val
As @Matthew Bernal said, it's negotiable. But be 100% prepared to pay the buyer agent commission. Otherwise it will be very hard for someone to afford a house, even if they have to pay an extra .5%, which can easily be $1,000+
Sam McCormack Realtor - 6moMarc RiceBusiness MemberReal Estate Agent · Columbus Cleveland Dayton, OH · Member since 2018 · 2k+ posts · 1k+ votes
Quote from @Vardhini K shipley:
Hello,
First time investor in cleveland, Ohio. I'm nervous as hell. Wanted to get y'all perspective as an investor, who is paying the realtor's commission of 3.5%? Is it the buyer or seller? Or is every situation is different? Please guide. Thank you- Val
It's typically at 3%, but negotiable, for on-market properties. Could be higher for the off-market ones though
Marc Rice | Investor Friendly Agent at Reafco Tailwind Team574 Reviews - 6moMichael K GallagherBusiness MemberReal Estate Agent · Columbus OH · Member since 2018 · 1k+ posts · 1k+ votes
you mentioned house flipping, so I take it you are looking on market for a property to rehab? if you build a relationship with an agent, some may be willing to do a reduced rate on the buy side of the property to help make the deal if you would work with them on the listing of the flip when you are done, and that commission was not reduced. many ways to skin a cat as they say but to everyones points above its all negotiable.
- Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes6mo
Quote from @Vardhini K shipley:
Hello,
First time investor in cleveland, Ohio. I'm nervous as hell. Wanted to get y'all perspective as an investor, who is paying the realtor's commission of 3.5%? Is it the buyer or seller? Or is every situation is different? Please guide. Thank you- Val
It's completely negotiable and what is common will vary market by market, deal by deal, that's why you're seeing a wide range of responses on here. In my market, if a property is listed on the MLS, the listing agent has often negotiated around a 6% total commission into the listed sale price. The seller technically pays 6% to the listing agent's brokerage at closing, and the listing agent's brokerage pays the buyers agent part of that, most often 2.8% with the listing agent keeping 3.2%. Sometimes it's different. I say technically the seller pays because while it comes from the seller's proceeds at closing, the buyer is usually the one bringing the money to the table to fund the transaction, so essentially the buyer is paying for everything. Your market may be different. Off MLS/ unlisted properties, you'll see a wider range of commission structures. Some if it comes down to how much work it will be for an agent, for example if all they are doing is the paperwork then the total commission may be much less than 6%.
Generally speaking, it makes sense for the seller to pay the buyer's agent's commission because most buyers will use financing and can include the commission into their loan this way. If the seller isn't offering a commission to the buyer's agent, the buyer may have to pay their agent out of pocket in addition to their down payment, and this can get in the way of a sale. Due to the changes from the NAR lawsuit, buyers and agents all have a signed agency agreement when looking at properties together now, and they won't know what the seller is offering just by looking at the MLS anymore, so what most agents are doing is simply asking the listing agent what the seller is offering, or just writing what their buyer's agency commission into the offer.
If you're engaging a buyer's agent to help you find your first property to flip (which if it's your first time you absolutely should, just be sure to pick a great agent who specializes in what you want to do, where you want to do it), they will explain all of this to you and let you know what they typically ask for in order to represent you, and you will enter into an agency agreement with them. Everything is negotiable. A lot of times if you establish a good relationship with an agent (use them to both purchase and sell a lot of flips for example) they will be more willing to negotiate on commissions. Other times experienced agents may be wary of working with first time investors, many of whom are frankly just time-wasters, and they may stick to a certain percent that they charge. Just because it's negotiable doesn't mean they have to take less than what they usually charge.
Keep in mind that the way an agent negotiates their commission may also be the way they will negotiate on your behalf when they become your fiduciary. If your agent can't negotiate their own commission, they may not negotiate well when it comes to working for you either!
- 6moNicholas L.Pro MemberFlipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
hello. this wasn't your question but since you noted you're a first time investor - you're right to be cautious. the market is exceptionally challenging right now for new investors. prices are high and rates are high. we see a lot of new investors who:
1. don't run the numbers correctly for a rental. rent minus PITI does not equal net income.
2. are surprised at how much everything costs - how much closing costs are. how much rent ready costs are. how much major repairs are, like a roof, sewer line, or HVAC. how much renewal costs are (typically one month's rent or more). how much turnover costs can be when a tenant moves out (several thousand dollars or more.) these always get overlooked / downplayed / ignored. they shouldn't be.
3. aren't well capitalized enough - they might have $40K in savings, total and want to buy a $150K property.
4. expect their agent or property manager to ensure they're successful... as opposed to just providing a service in exchange for a fee.
none of those may be you but i wanted to throw those out there.
hope this helps.
- 6moPeter MckernanBusiness MemberResidential Real Estate Agent · Irvine, CA · Member since 2013 · 2k+ posts · 1k+ votes
I mean you need to negotiate and also use the right people for getting the place sold. So, it is up to you and you need to make sure that you work with the right people/agent to get the place sold. Call people back, get people into a property to view the place and get it sold. You need to market it right and so much more. It is not just about the lowest bottom dollar.
The McKernan Group4.957 Reviews - Lender · Charlotte, NC · Member since 2024 · 14 posts · 6 votes6mo
My advice would be to make sure you are working with investor friendly agents! Your best deal may be off market and they can help you run numbers. They should have connections to off market wholesalers etc.
As for the sale, like people have mentioned, it's negotiable and depends on what they are offering (BAC, staging, etc).
As an investor I would make sure there is enough spread on it to be able to DSCR it into a BRRRR in case it doesn't sell. I also wouldn't put all of my money into the deal. I would leverage hard money so that you're not tight on funds for the project or holding costs that people often forget.
Send me a dm if you want to chat more I'm an agent in NC and a lender nationwide.
- Specialist · NJ · Member since 2022 · 1k+ posts · 653 votes5mo
When you buy a fixer upper, if you are buying it wholesale - ALL the closing costs are on you. If you buy off of the MLS the commission is split between buyer and seller.
When you go to sell your fixer upper, the entire commission will come out of your end.
If this is your first deal, the RE commission splits is the last thing you should be concerned with. You have a long, dark tunnel ahead of you my friend. Take this advice:
Deduct 10% off any comps you are shown
add 10% to your rehab budget
Plan on it taking twice the time
If all the numbers still work after those adjustments, it's a good deal.
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