What should home sellers and buyers do differently in 2025 to negotiate commissions and service agreements?
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Executive summary
In 2025 the playbook for negotiating commissions and service agreements changed: buyers increasingly must sign written buyer-broker agreements that specify fees and services, and MLS listings no longer show automatic buyer‑agent compensation—so commissions are negotiated directly between clients and agents [1] [2]. Average splits and totals remain near historical levels (total commissions often between ~4–6% and buyer‑agent averages around ~2.4% in 2025), meaning bargaining power and contract language now determine who pays and how much [2] [3].
1. Know the new rules and why they matter
Federal and industry settlements and state law changes have forced structural shifts: listing brokers may no longer post buyer‑agent offers on MLS and many states now require written buyer representation agreements that disclose compensation and services up front—so buyers sign fees into enforceable contracts and sellers can’t simply rely on an MLS “included” buyer commission [2] [4] [1]. These rule changes turn what was often an implicit marketplace norm into explicit, negotiable contracts, and that changes leverage for both sides [2].
2. Sellers: prepare to negotiate earlier and document smarter
Sellers still often pay buyer‑agent fees in practice, but that’s no longer automatic—sellers should decide a commission strategy before listing, document it in the listing agreement, and be ready to negotiate directly with buyer agents when necessary [3] [5]. A seller with a high‑value home, quick market, or willing to take on tasks (photography, staging, showings) can justify asking for a lower listing fee; conversely, sellers in slow markets may need to offer stronger buyer compensation to attract offers [6] [7].
3. Buyers: sign and scrutinize buyer‑broker agreements
Buyers now must sign representation agreements that spell out services and fees; those contracts can lock in rates and reduce later bargaining room, so buyers should negotiate terms—flat fees, hourly rates, or percentage structures—as soon as they retain an agent and require clear termination and service definitions in writing [1] [8]. Ask which deliverables the fee covers (showings, negotiations, inspections) and whether the agreement permits adjusting compensation if the seller offers to pay later [9] [10].
4. Use market data and multiple bids as leverage
Both buyers and sellers gain leverage by showing comparable local commission norms and market velocity: listing quickly selling homes or expensive properties can justify reduced listing fees; markets with weaker demand make buyer agents stickier on compensation. Know local averages—buyer agent fees clustered about 2.4% in 2025 per Redfin analyses—and cite them in negotiations [2] [3]. Interview multiple agents and get written proposals that tie fee levels to defined service packages [7] [11].
5. Reframe fee talks as service negotiations, not price haggling
Agents emphasize that commissions are negotiable and tied to service scope. Ask agents to itemize services and offer tiered packages: reduced‑commission listings for limited services, premium packages for full marketing, or capped flat fees for cash or investor deals [12] [11]. Sellers should explicitly list any tasks they’ll handle to justify lower fees; buyers should secure a written description of advocacy duties in their buyer‑broker contract [13] [1].
6. Watch for state and contract traps; insist on transparency
State updates to standard forms and proposed laws (like New York bills to require clear compensation disclosures and to ban unfair long service contracts) indicate regulators are focused on consumer clarity—read every clause about duration, post‑agreement claims, and referral/marketing arrangements to avoid unexpected liabilities or auto‑renewals [4] [14]. Use updated association forms (when available) as a baseline and consult counsel for unusual clauses [15] [14].
7. Expect mixed outcomes — data shows inertia and rebound
Despite rule shifts intended to increase competition, several data points show commissions didn’t collapse: buyer‑agent averages bounced back to roughly historical norms (~2.4%) in 2025 and many sellers still negotiate or pay buyer fees; nearly 37%–38% of recent sellers attempted to negotiate commission, per surveys [3] [16]. That means knowledge and early documentation help, but market dynamics still keep total fees largely intact [2] [3].
Limitations and disagreements in reporting: sources agree the structural rules changed and buyer agreements became mandatory in many places, but they diverge on how quickly commissions will fall or who ultimately bears them—some note swift rebound to old norms while others point to growing negotiation opportunities [2] [3] [17]. Available sources do not mention a single, nationwide standardized replacement for the old MLS compensation practice; local laws and broker forms still vary (not found in current reporting).