Commission is one of the first questions sellers ask, and it’s a fair one. You’re about to make a major financial transaction, and you deserve a clear, honest answer, not a vague “it depends.” So let’s actually talk about it.
In Michigan, the average total real estate commission runs between 5.7% and 6.2% of the sale price. That typically breaks down into roughly 2.85% to 3% for the listing agent (the agent representing you as the seller) and 2.85% to 3% for the buyer’s agent. On a $300,000 home, you’re looking at roughly $17,000 to $18,600 in total commission. On a $400,000 home, that range is about $22,800 to $24,800.
Those numbers aren’t set by law. Commission is always negotiable. There is no mandated percentage. It’s a business agreement between you and the agent you hire. What you should be thinking about isn’t just the rate, but what you’re getting for it.
Something important shifted in 2024 that’s worth understanding. Following a major legal settlement with the National Association of Realtors, the rules around how buyer’s agent commission is handled changed significantly. Previously, the seller’s commission offered to the buyer’s agent was advertised directly in the MLS. That’s no longer allowed. Now, compensation to the buyer’s agent has to be negotiated separately, either in the purchase contract or through direct agreement between the parties.
What this means practically is that sellers are no longer automatically expected to pay the buyer’s agent, though many still choose to as an incentive to attract more buyers. If you offer to cover the buyer’s agent fee, you’re widening the pool of buyers who can comfortably make an offer on your home. If you don’t, buyers may need to account for that cost themselves, which can affect what they’re willing or able to offer you. It’s a strategic decision, and a good agent will help you think through what makes sense given current conditions in your market.
One thing I’d caution against is making your decision based on rate alone. A discount listing agent who charges 1% to 1.5% might seem like a great deal on paper, but if the home sits longer, requires price reductions, or sells below what a more experienced agent could have achieved, the math often doesn’t add up. Commission is a cost. Net proceeds are what matters. The goal is to walk away with the most money in your pocket, and sometimes the agent who charges more earns significantly more for you in return.
The right question isn’t “what’s your commission?” It’s “what will I net after working with you?” A good agent should be able to walk you through that conversation clearly, showing you their pricing strategy, what comparable homes have sold for, and what a realistic outcome looks like for your specific property.
In Southeast Michigan (whether you’re in Ypsilanti, Belleville, Van Buren Township, or Ann Arbor), market conditions, price point, and competition all play a role in what a smart commission structure looks like. There’s no one-size-fits-all answer, but there is a right conversation to have before you sign anything.
If you want to understand what selling your home would actually cost, and what you’d realistically walk away with, I’m happy to walk you through the numbers.
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