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8 min read May 05, 2023

What Is a 5% Real Estate Commission? (2023 Updates)

Whether you’re selling a luxury condo in Miami or a single-family home in Portland, you will spend a whooping 6% in commissions. The majority of sales include two agents – a listing agent and a buyer’s agent.

As the name suggests, 5% commission Realtors are discount brokers who work at a 5 percent commission. They offer all the services similar to a full-service agent at discounted rates.

We have compiled a list of Realtors who charge 5% (or less) for your next real estate transaction.

Key Takeaways

  1. What Does a 5% Commission Discount Mean? A 5% commission is when your agent provides all real estate services like a traditional broker for a low commission of 5%.
  2. Understanding the Discount: The discount is on the listing fee. You still have to pay the buyer agent commission.
  3. How to choose a 5% Commission Realtor? While choosing a 5% commission Realtor you must consider their pricing, the technology they use and the quality of services they provide.
  4. Alternatives: You can list on the MLS using Flat Fee MLS companies like Houzeo. It is 100% online and automated to cater to various seller needs.

Rankings: Best 5% (or less) Commission Companies

Company NameListing FeeMax Savings100% Online5-Star Reviews
Flat Fee
Ideal Agent2%

Reviews: Best 5% (or less) Commission Companies

1. Houzeo

#1 Flat Fee MLS Service

Houzeo Logo
  • Listing Fee: $399
  • Available nationwide
  • Houzeo has 4.9 out of 5 stars 4.9/5 (4,523 reviews)

Houzeo offers 4 Flat Fee MLS packages.

  • Bronze Package – $329+: This package offers Houzeo listing only for 6 months with maximum photos.
  • Silver Package – $399+: This includes everything that home sellers typically look for.
  • Gold Package – $379+: It is Houzeo’s signature MLS package and includes all the technology Houzeo is known for Houzeo Showings, Houzeo Offers, and DigiTransact.
  • Platinum – $349+: It includes the assistance of a licensed broker to help you with negotiations, disclosures, and closing.

👉 Our Take: We recommend the GOLD plan. You’ll have access to Houzeo tech, making managing showings and offer negotiations easy!

» Houzeo Reviews: Houzeo is 100% online. You can finish listing formalities in less than 60 mins.

Houzeo is America’s #1 Flat Fee MLS service because of 4 reasons:

  1. Max Exposure: Houzeo MLS packages give you access to the MLS, Zillow, Trulia,, Redfin, and 100s of other websites.
  2. 5-star Customer Service: Houzeo has a fully staffed customer service desk available 6 days a week. Chats and emails are open 7 days a week. This is rare in today’s world.
  3. 100% Online: Houzeo is high-tech. For you, this means easy listing, fast changes, online showings, and online offers Houzeo Mobile App is also very powerful.
  4. No Listing Commission: In most states, you’ll be paying just a small flat fee to list on MLS. Houzeo covers 47 states + DC! And remember, all fees are disclosed upfront, so there are no Houzeo hidden fees. You get to bypass the listing agent commission!

There are no dealbreakers with Houzeo.

» Houzeo Reviews: Houzeo is rated “Excellent” with a 4.9 out of 5 star rating by 4,521 home sellers on Google Reviews and Trustpilot!

Houzeo is rated 4.9 out of 5 stars by thousands of home sellers on Google & Trustpilot.

» Houzeo Reviews: Check out how Team Houzeo has addressed all Houzeo complaints from home sellers. is a top-ranked Flat Fee MLS service. Houzeo provides an unbeatable combination of max savings, 5-star customer support, and cutting-edge technology.

Although it isn’t a 5% commission company, you can still save thousands by listing with Houzeo! Listing with Houzeo gets you a personalized dashboard, a 100% online platform, and timely customer service—at a flat rate.

2. Redfin


  • Listing Fee: 1.5% of sale price
  • Available in 80+ U.S. Markets
  • 3.5 Stars 3.3/5 (372 Reviews)

Redfin is one of America’s top discount real estate brokerages. This low-commission broker specializes in home buying.’s technology is what sets it apart from all other platforms.

  • Redfin Full-Service Agent – 1.5% Commission: This is a full-service package. This includes pricing assistance, listing paperwork, negotiation support, etc.
  • Redfin Concierge – 2.5% Commission: The “Concierge” plan includes everything from the Full-Service package. Additionally, it includes services like professional cleaning, home staging, and more.
  • Redfin Premier Agent – 1.5% Commission: This package is exclusively for luxury properties and includes everything that comes with the Full-Service package.

👉 Our Take: We recommend Redfin’s concierge service. This service enhances the value of your house with a professionally managed design plan and no upfront fees.

» Selling With Redfin: Is it worth selling with Redfin?

Here are some advantages of choosing Redfin:

  • Advanced Technology: Redfin is primarily known for its advanced tech platform and mobile app.
  • Full-Service Agents at Low Commission – 1.5%: Redfin’s full-service package is priced at 1.5%. It saves you thousands compared to the traditional 3% listing commission.
  • Buyer Rebate – 0.5%: Clients who sell and buy with Redfin within one year get a rebate of 0.5% in the second transaction. However, this offer is available with the Full Service Plan.
  • Detailed Paperwork: Redfin provides the necessary paperwork and an elaborate listing agreement with a marketing plan.
  • Nationwide Coverage: Redfin covers 80+ markets in the US.

» What is RedfinIs it truly a smart choice to choose them? Read the comprehensive review to know more!

In our research, we found some red flags of Redfin, that could make your experience less satisfactory.

  • Lack of Personalized Services: Customers have often complained that Redfin agents are not able to give personalized service, as they serve a high volume of clients.
  • Poor Customer Reviews: Customers have complained that agents are often unreachable and unprofessional.
  • Slow Listing Process: According to Redfin’s listing agreement, a Redfin property takes 18 days to list on MLS. Services like Houzeo will list you on the MLS within 24 to 48 hours.
  • Limited Agent Selection: As per customer reviews, Redfin lacks an array of agents. This means you get an agent assigned automatically without having any choice in the matter.
  • Agents are Less Incentivized: Unlike traditional agents who work for commission, Redfin agents get a fixed salary. This can demotivate them from offering you additional services.

» Redfin hidden FeesCheck this out to learn more about their hidden fees.

Redfin has an average rating of 3.3 out of 5 stars on Consumer Affairs.

» Redfin Reviews: The Reality of 1% Fees, Pros, Cons, & Alternatives!

Redfin is one of the most popular discount brokers in the US, primarily known for its mobile app. The company gives you advanced tech support and full-service agents for a 1.5% commission.

It takes 18 days to list your property on the MLS via Redfin. On the other hand, Houzeo lists your property within 1-2 business days, saving valuable time.

Before you choose Redfin, make sure to check out its reviews online. Most of the reviews complain about the agent’s inconsistent services.

3. SimpleShowing


Simple Showing

simpleshowing logo
  • Listing Fee: 1% of sale price
  • Restricted coverage
  • 4.75 Stars 4.9/5.0 (125 reviews)

SimpleShowing, like any other low-cost real estate broker, matches sellers with real estate agents.

  • Listing Agent Commission – 1%: A SimpleShowing agent provides full-service MLS listing at a 1% commission rate. The premium lockbox charges will increase your costs.

👉 Our Take: We recommend Simple Showing for their Buyer’s Rebate Program. But Simple Showing has a minimum fee charge that could be higher than the advertised 1%.

SimpleShowing is a decent option when buying or selling a property.

  • Easy Property Search: SimpleShowing provides a home search experience at your fingertips. You can look for properties and book home tours on their website, saving time and money.
  • Professional Photography: They coordinate professional photos and videos of your home at no additional charge.
  • Buyer’s Rebate: SimpleShowing rebates a portion of its commission to eligible home buyers.
  • Dedicated Agents: From home valuation and developing a marketing strategy to negotiating offers and closing, their agents will always assist you.

During our research, we found a few red flags with Simple Showing.

  • Buyer’s Rebate Eligibility: The buyer is eligible for a rebate only if the buyer uses SimpleShowing as their Buyer Broker.
  • Lender’s Approval: Some lenders may not allow buyers to receive a refund from SimpleShowing. Lenders consider contracts, mortgage products, and pricing policies to allow the buyer to receive full or a part of the rebate amount.
  • Minimum Commission: SimpleShowing has a minimum commission of $3,500. Rebate applies only if the minimum commission accounts for $3,500.
  • Limited Coverage: Simple Showing provides services in only 3 states – Florida, Texas, and Georgia.

SimpleShowing has a 4.9 out of 5 stars from 125 total reviews on Zillow.

SimpleShowing’s brokerage services provide a top-notch customer experience. You can rely on their local agents for your real estate transactions.

They also charge $3,500 as their minimum fee. Only buyers who hire agents through SimpleShowing are eligible for a refund. The buyer’s rebate also requires the lender’s clearance.

4. Prevu



Prevu logo
  • Listing Fee: 1.5% of sale price
  • 5 Stars 5.0/5.0 (455 reviews)

Prevu is a full-service low commission brokerage based in New York that aims to change the old-school ways of the real estate market.

  • Listing Agent Commission- 1.5%: Prevu charges a lower commission of 1.5%. It offers a full-service package at a low commission rate.

👉 Our Take: Prevu’s listing price is lower than traditional realtor commission, but it is still higher than other low-commission real estate companies.

» Prevu Reviews: Read our review of Prevu Real Estate & decide if it’s a good choice for you.

Prevu is a decent option when you are buying or selling a property.

  • Qualified Agents: Prevu’s qualified agents provide real estate services at low commissions.
  • Buyer’s Rebate: Buyers get a commission rebate of 2% of the purchase price.
  • Serve a High Volume: Prevu relies on its team to serve a high volume of clients to offer discounts.

You should know about a few red flags that Prevu has. This can make your experience less satisfactory.

  • Additional Charges: Buyer’s agent commission is not included in Prevu’s listing fees. This commission is up to 2.5%-3 % of the sale price.
  • Limited Agents: Prevu’s team is small and its agents deal with higher volume. So you have limited options when it comes to selecting an agent.
  • Lack of Personalized Experience: Since Prevu’s team handle a higher volume, the agents won’t be able to provide personalized services.
  • Limited Coverage: Prevu Real Estate serves 6 states only- New York, Massachusetts, Connecticut, California, Pennsylvania, and Washington.

Prevu has 5.0 out of 5 Stars from 455 reviews on Google.

 » Prevu Reviews: Read our review of Prevu Real Estate & decide if it’s a good choice for you.

Prevu provides seller’s real estate services at a low commission rate. It also offers one of the most significant commission rebates for buyers.

Prevu has a small team of agents who deal with a higher volume of clients. This limits the options of selecting an agent you prefer.

5. Ideal Agent


Ideal Agent

Ideal Agent Logo
  • Listing Fee: 2% of sale price
  • Nationwide coverage
  • 4.9 Stars 4.9/5 (5,727 Reviews)

Ideal Agent is among the top discount brokerages. It is an agent matching service that specializes in home selling.

  • Full Service – 2% Commission: The full-service package will get you all the services from start to end. This includes professional photos, negotiation, and closing assistance.

👉 Our Take: Ideal Agent is a good choice for home sellers. Although their overall online reviews are good, they are often inconsistent while matching agents with clients. They have no services for home buyers.

» What is Ideal Agent: Check out our reviews of Ideal Agent to know more about them.

Ideal Agent is an agent matching service that helps sellers find low commission real estate agents.

  • Agent Matching: They claim that you will be matched with an agent from the top 1% producers in your locality.
  • Pre-Negotiated Commission: Ideal Agent has pre-negotiated the commission with their agents. This allows sellers to focus on the other aspects of the transaction.
  • Profit Maximization: Your agent will leverage the best features of your house and help maximize your sale profits.
  • Dedicated Concierge: Their agents guide you in every step of the transaction from marketing, to negotiation assistance, and closing.

» How does Ideal Agent workHere is a detailed explanation about them. Check it out!!

Ideal Agent has some drawbacks we came across in our research.

  • Low Savings: Ideal Agent charges more than most low-commission companies, compromising your savings. You will be paying a total commission of 4.5% – 5% even with discounted listing fees.
  • Additional Referral Fees: Ideal agent fees includes a 25% referral fee from real estate agents after successful transactions. Since you pay the agent, these fees are essentially going from your pocket.
  • Outdated Technology: Their agent matching algorithm is inconsistent. Several customers complain about being assigned sub-par agents.
  • No Buyer Support: Ideal Agent isn’t a buyer-focused platform and they offer no significant benefits for home buyers.

Ideal Agent has a rating of 4.9 out of 5 from 5,727 reviews on TrustPilot.

» Ideal Agent Reviews: Check out our reviews of Ideal Agent to make an informed decision.

Ideal Agent is an agent matching service that connects sellers and buyers to expert agents. They claim to offer the best agents from the top 1% of sales contributors in the local markets.

Before you choose Ideal Agent, check out its reviews online. Customers often complain about paying more than advertised and inconsistent agent services.

How Does a 5% Real Estate Commission Work?

Companies that provide a 5% real estate commission offer listing fee reductions.

In a traditional real estate transaction, you will generally pay up to 6% real estate agent commission. This commission is shared in half between your listing agent and the buyer’s agent.

Remember, the discount is on the listing fee. Therefore, instead of 6%, your listing agent will list your home for a pre-negotiated fee of 5%. The reduced fee can easily save you thousands in commissions.

How Much Can You Save With a 5% Commission Realtor?

Although it may seem like a small fraction, 5% commissions can help you save thousands! Your total savings depend on the listing price of the house. Higher sale price = greater savings.

Here is the table showing how much you will save working with a 5% real estate company:

Selling Price5% Realtor Commission6% Realtor CommissionTotal Savings

*Calculated using a 3% buyer’s agent commission

Who Should Opt for a 5% Commission Realtor?

Sellers who prioritize savings should consider low-commission real estate agents. They usually provide a similar level of services as conventional Realtors but at a discounted rate. This could mean BIG savings. However, it may not necessarily be true.

    📌 Low commission rates do not always lead to greater discounts.

    The average commission rate varies nationwide and certain states charge hefty minimum fees. Thus it’s essential to look into the various charges applicable in your state before selecting a real estate agent.

How to Choose a 5% Commission REALTOR?

Here are some of the factors to consider while choosing a 5% commission Realtor:

  • Pricing: Most 5% real estate companies charge minimum fees as part of the commission. Research 5% commission realtors in your area to know how much you would shell out.
  • Technology: Choose a 5% company with cutting-edge technology that can provide you with a digital dashboard to manage your transactions.
  • Quality of Services: Interview multiple real estate agents from different companies to understand who offers the best services. You can also read agent reviews online on platforms like Zillow and

Why Would an Agent Agree to 5% Commission?

Here are some reasons why agents work at a 5% fee:

  • It’s a Hot Seller’s Market: In a seller’s market, the commission rates tend to drop slightly. A low supply of inventory leads to greater competition for listings. This forces agents to reduce their commission rates to get more listings.
  • The Agents Lack Experience: Beginner agents with no solid sales history might agree to lower rates. This helps them attract more home sellers.
  • The Agents Deal in Luxury Properties: Luxury real estate agents make tens of thousands even at low commission rates. For example, a 5 percent commission agent will earn $50,000 for a property sold at $1 million.

Also, most traditional Realtors are open to negotiating their rates. Thus you don’t necessarily have to compromise on the quality of the services while saving a lot of money.

Risks of Using a 5% Commission Realtor

  • Low Quality Services: Most 5% commission Realtors work with broker franchises. The service quality you receive will highly depend on your choice of franchise. There’s no guarantee of good quality service.
  • Lack of Personalised Service: During our research, we came across customer complaints about a lack of availability of agents. This is generally because low-commission agents have to handle multiple sellers at once. This leaves them with less time to devote to each client.
  • Minimum Fees/Hidden Charges: Some real estate companies charge minimum fees as part of the real estate agent’s commission. You might have to pay more than the advertised 5% commission rate at closing.

Alternatives to 5% Commission Realtors

  1. Flat Fee MLS: Flat Fee MLS companies charge a standard rate to list your home on multiple listing services (MLS), an online database of homes in your region. The fees are usually set between $179-$399.
  2. Hire a Discount Real Estate Broker: Discount real estate brokers offer all the services of a traditional broker for a discounted commission. Typically, discount brokers will charge between 0.5% to 3% commission to list and sell your home.
  3. Negotiate with your Agent: Negotiating with the agent is always on the table. Standard 2.5% – 3% rates are not that different from 5% commission. Therefore, negotiate with your local agent to get a discounted rate.
  4. Sell to an iBuyer: Many iBuyers, like Opendoor and Offerpad, purchase hundreds of homes across U.S. markets. iBuyers can be a great option if you’re wondering how to sell your house fast.
  5. Sell to Cash Home Buyers: Individual cash home buyers and companies that buy houses for cash in the U.S. make all-cash offers, usually within 24 to 48 hours. Cash buyers let you skip the hassle of listing on the MLS, inspection, appraisal, etc.

Calculate Your Savings: Traditional Agent vs. 5% Commission Realtor vs. Houzeo


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Your savings via Houzeo


Houzeo saves you $9,705 more than Ideal Agent!

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Final Word

In today’s market, several Realtors offer services at discounted rates. Research the different companies before selecting a 5% commission Realtor.

As per research, Houzeo is the top low-commission company. Houzeo outperforms its competitors in all parameters – from technology to customer rating.

Eager to Know How Houzeo Works?

We’ve got you covered. Check out the following video to understand how Houzeo works and why it is one of the best For Sale By Owner websites in the U.S.

What is Houzeo?

An overview of what the platform is all about

Start Your MLS Listing NOW!

» NEED MORE CLARITY? Read these exclusive Houzeo reviews and learn why it is one of the best FSBO sites in America.


What is a 5% commission realtor?

A 5% realtor lists your home for 3% of the final listing price of your home. This is generally exclusive of the buyer's agent charges which are 2.5%-3%, so your total will be around 5.5%, giving you almost 0.5% in savings.

What is the average realtor commission?

Traditional realtors usually charge 2.5%-3% of the final listing price of your home for both the buyer and the seller's side. This means you will end up paying up to 6% in total real estate commissions.

Is 5% a good commission?

A 5% real estate commission is a good option for home sellers keen on saving big, although some 5% commission realtors might not provide full package services as a traditional realtor.

Who pays Realtor fees?

It is standard practice for the SELLER to pay the Realtor fees of both the listing agent and the buyer's agent.

Is a 5% real estate commission fair?

Several realtors in the market offer full services at discounted rates instead of the conventional fees, so it is fair to charge 5% real estate commission.


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