Updated November 2026. What the law says about commission rates, from federal antitrust law, California and Texas statutes, NAR’s consumer guides and five state tax pages, all read November 9, 2026. General information, not legal advice.
No. Real estate commission isn’t set by law, and as of November 2026 we found no state that fixes a rate. Brokers who agree on one together can break the federal Sherman Act. What states do control is how the fee is written: California requires a printed notice, and Texas requires a signed writing.
Jump to: ⚖️ The law · 🗺️ What states control · 💵 Transfer taxes · 🔎 The old 6% idea · 🏠 Beycome’s fee · ❓ FAQ
Key takeaways
- Commission is a private deal between you and a broker. It’s negotiable.
- NAR’s own consumer guide says compensation “is negotiable and not set by law,” and it must be clearly defined in a written buyer agreement.
- State law decides the paperwork: notices, written agreements and who may be paid at all.
- Transfer taxes are the selling cost states really do set, and they run from 0.1% to 1% in the five states below.
People often assume there’s a legal rate, because for years so many listings quoted similar numbers. But a habit isn’t a law. Knowing the difference gives you a stronger hand when you sit down to talk fees. If you’d rather see what people actually pay, our typical commission guide covers that side. This one is about the rules.
Is it illegal for brokers to set commission rates?
It’s illegal for competing brokers to agree on them. Section 1 of the Sherman Act declares illegal every contract, combination or conspiracy in restraint of trade among the states. A single broker can charge whatever it wants and you can say no. Rivals can’t get together and pick a number.
The trade group agrees that the number is open. NAR’s consumer guide on buyer agreements says compensation “is negotiable and not set by law.” Its guide for sellers explains what the 2024 settlement changed. For your own reading, the National Association of Realtors keeps these guides online, and Nolo’s legal guides explain contract terms in plain language.
What do states actually control about commission?
States control the form of the deal and who can be paid, and leave the price to you. We read the statutes for two large states. Your state’s real estate commission or attorney can tell you the rest.
| Rule | Where we read it | What it means for you |
|---|---|---|
| Printed notice: rates are “not fixed by law” and may be negotiable | California Bus. and Prof. Code 10147.5 | It must appear in 10-point bold type right before the pay clause in printed listing forms for homes of up to 4 units |
| The rate can’t be pre-printed on the form | California Bus. and Prof. Code 10147.5(c) | The number has to be filled in for your deal |
| Agreement must be written and signed to sue for a commission | Texas Occupations Code 1101.806(c) | A verbal promise can’t be enforced in a Texas court |
| Agent must advise a buyer about an abstract or title policy | Texas Occupations Code 1101.806(d) | A license holder who skips it can lose the commission |
| Conspicuous disclosure about the negotiability of commissions | Raised in NAR’s settlement FAQs on pre-closing forms | Look for that language in your agreement, and ask if you can’t find it |
That California wording is worth reading twice: “They are set by each broker individually and may be negotiable between the seller and broker.” Nobody can tell you the law sets the rate, because the form in front of you says it doesn’t. If you want tactics, see how sellers negotiate agent commission.
A word on what’s not covered. We haven’t surveyed every state, and we’d rather say so than guess. Rules on licensing, rebates and written agreements differ, so check yours. Buyer rebates, for example, are restricted in some states and barred in Alabama and Tennessee.
Which selling costs do states set?
Transfer taxes. Unlike commission, these are written into state law, and they change a lot from one state to the next. Here’s what five state sources said on November 9, 2026, with the amount on a $400,000 sale, before any local add-ons and exemptions:
| State | State rate | On $400,000 |
|---|---|---|
| Georgia | $1 for the first $1,000, then 10 cents per $100 | $400 |
| Tennessee | 37 cents per $100 | $1,480 |
| North Carolina | $1 per $500 | $800 |
| Florida | 70 cents per $100 (most counties) | $2,800 |
| Pennsylvania | 1% state tax | $4,000 |
Who pays depends on the state and your contract. Pennsylvania’s revenue department says the grantor and grantee are jointly liable, and North Carolina’s statute puts it on the transferor. Georgia’s tax is paid by the person who executes the deed. In Florida, our doc stamp tax guide has the county details, including Miami-Dade’s different rate. You’ll see your final number on the Closing Disclosure or settlement statement, and the Consumer Financial Protection Bureau explains how to read it.
So when someone says commission varies by state, that’s partly true of the dollar amount, since 1% of a home differs widely by area. Zillow Research’s Home Value Index shows those local values. The rate itself is still a private deal.
Where did the idea of a “standard 6%” come from?
It’s custom, not statute. Listing agreements often split one fee between the listing side and the buyer’s side, and that split was long visible to agents on the MLS. Since August 17, 2024, offers of buyer-agent compensation can’t appear on the MLS, and sellers decide whether to offer any at all.
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On homes listed by other agents, Beycome credits you up to 2% of the price at closing (1% kept, $1,499 minimum; not on FSBO homes or homes listed by Beycome sellers).
Buy a home →If an agent quotes you 5% or 6%, that’s a price, and you can treat it like one. You can ask for less, ask what’s included, or pick a different model. A flat fee is one of those models, and our flat fee explainer shows what it covers. Plenty of agents earn every dollar of their fee. You’re just free to decide what the work is worth to you. Our guide on whether sellers pay the buyer’s agent covers the other half of the bill.
How does Beycome’s fee fit these rules?
Our listing agreement says it directly: the fee is fully negotiable and isn’t fixed, controlled, recommended or suggested by law, any MLS or any REALTOR® association. Basic is from $99 in most states ($129 in California and Illinois), Enhanced is $399 and Concierge is $1,399. The fee is earned when your listing is published on the MLS, and you owe Beycome nothing more at closing, even if you find the buyer yourself.
We don’t set, collect or pay buyer-agent compensation on your listing. If you choose to offer some, you agree it directly with that agent in writing, and a free “Compensation Agreement – Seller to Buyer’s Broker” template is in your dashboard under Legal Forms. Beycome lists in 17 states and DC, and listing terms run the maximum the state and MLS allow, up to 24 months (12 in Maryland and Pennsylvania).
In Florida, Texas, Michigan, Ohio, Illinois and Indiana, Beycome Title can close the sale too. Traditional agents remain a fair choice, and our sellers close deals with them every day. 22,000+ have chosen this alternative, with over $225 million saved (Beycome internal data, October 2026).
Know the rules now? Compare flat fee packages for your state.
Commission and the law: questions
Is real estate commission set by law?
No. Commission is negotiated between you and the broker. NAR’s guides say it’s negotiable and not set by law, and California requires that statement on printed listing forms.
Is real estate commission regulated by the state?
The rate isn’t, in the states we checked. The paperwork is: states can require written agreements, notices and a license to be paid.
Is a 6 percent commission required?
No. It’s a custom some people still quote. Any rate is an agreement between you and your broker, and you can ask for a different one.
Can real estate agents agree on commission rates?
Competing brokers can’t agree on a rate. Section 1 of the Sherman Act makes that kind of agreement illegal. Each firm has to set its own prices.
Does a commission agreement have to be in writing?
In Texas, yes, if the broker wants to sue for it. Other states have their own rules, so ask your state regulator or a lawyer, and get any agreement in writing anyway.
Which states have the highest transfer tax?
Of the five we checked, Pennsylvania’s 1% state tax was highest, and Georgia’s roughly 0.1% was lowest. Local taxes can add more in some places.
Commission figures are examples only. Commissions are not set by law or NAR rules and are negotiable. Sellers choose whether to offer buyer-agent compensation, and those offers have not been shown on the MLS since August 17, 2024. Prices as of November 2026. $0 at closing means no Beycome fee at closing; taxes, title and any buyer-agent compensation you agree to still apply. Transfer tax math assumes no exemption or local tax. General information, not legal or tax advice.
Sources
- 15 U.S. Code § 1 (Sherman Act), Legal Information Institute, read November 9, 2026.
- California Business and Professions Code § 10147.5, read November 9, 2026.
- Texas Occupations Code § 1101.806, read November 9, 2026.
- NAR, Consumer Guide to Written Buyer Agreements, read November 9, 2026.
- NAR, Settlement FAQs, read November 9, 2026.
- NAR, Home Sellers: What the NAR Settlement Means for You, read November 9, 2026.
- Florida Department of Revenue, Documentary Stamp Tax, read November 9, 2026.
- Pennsylvania Department of Revenue, Realty Transfer Tax, read November 9, 2026.
- Georgia Department of Revenue, Real Estate Transfer Tax, read November 9, 2026.
- North Carolina General Statutes, G.S. 105-228.30, read November 9, 2026.
- University of Tennessee CTAS, Transfer Tax, read November 9, 2026.
- Beycome, listing agreement terms and package features, November 2026.
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