Seller Strategy · Commission · Los Angeles
How Do Commission Splits Work in Los Angeles?
Justin Borges, DRE #01940318 · 11 min read · Updated July 26, 2026
"Commission split" actually describes two different things in a Los Angeles sale: how compensation is arranged between the listing side and the buyer side of the transaction, and how an individual agent's own share is then split with their brokerage. Neither figure is set by any board, association, or MLS. Every commission and every internal split is individually negotiated between the parties involved (NAR Settlement FAQs).
Sources: NAR Settlement FAQs (nar.realtor); CA DRE Consumer Alert, December 12, 2024 (AB 2992); NAR 2026 Summary of Key Professional Standards Changes.
What You Will Learn
- What Does "Commission Split" Actually Mean in a Los Angeles Real Estate Sale?
- How Is Commission Split Between the Listing Side and the Buyer Side Now?
- How Is Commission Split Between an Agent and Their Brokerage?
- Is There a Standard Commission Split in Los Angeles?
- How Did the NAR Settlement Change How Commission Splits Work?
- Can a Seller Refuse to Pay Any Buyer-Side Commission?
- What Should Sellers Negotiate Before Listing?
- Frequently Asked Questions
What Does "Commission Split" Actually Mean in a Los Angeles Real Estate Sale?
Sellers and buyers in Los Angeles often hear "commission split" used loosely, but it actually refers to two separate arrangements. The first is the split between the listing side of the transaction and the buyer side, meaning how much each side's agent is paid out of the total transaction. The second is an entirely internal matter: how the agent on either side splits their own earned commission with their brokerage.
Confusing the two leads to a lot of unnecessary frustration. A seller negotiating with their listing agent is negotiating the first kind of split. What that agent then keeps versus pays their brokerage has nothing to do with the seller's transaction at all.
A seller only ever negotiates one split: what they're paying their own agent and what, if anything, gets offered toward the buyer's side. Everything after that is between the agent and their brokerage.
Justin Borges, CA DRE #01940318How Is Commission Split Between the Listing Side and the Buyer Side Now?
Since August 17, 2024, MLS systems covering Los Angeles can no longer publish a buyer-broker compensation offer anywhere in a listing (NAR Settlement FAQs). That changed how this first kind of split gets arranged. A seller now negotiates their listing agent's fee directly, and any amount going toward the buyer's side is a separate, distinct decision, not an automatic percentage baked into the listing.
| Mechanism | How It Works Now |
|---|---|
| Listing agent's fee | Negotiated directly between seller and listing agent, in the listing agreement |
| Seller concession toward buyer's side | Optional; negotiated in the purchase offer; seller may accept or reject |
| Off-MLS broker-to-broker offer | Still allowed, but cannot appear anywhere inside the MLS itself |
| Buyer pays their own agent directly | Set in the buyer's written representation agreement (flat fee, percentage, or hourly) |
None of these mechanisms are new inventions, but the MLS publication ban means a Los Angeles seller has to make an affirmative choice about buyer-side compensation rather than assuming it happens automatically.
How Is Commission Split Between an Agent and Their Brokerage?
Once a Los Angeles agent earns a commission from either side of a transaction, they typically split a portion of it with their own brokerage under a private agreement that has nothing to do with the seller or buyer. These arrangements vary widely by brokerage and by agent, and no board, association, or MLS sets or publishes a standard structure for them.
| Illustrative Brokerage Model | How the Split Generally Works |
|---|---|
| Traditional tiered split | Brokerage keeps a larger share early in the year, agent's share increases as their production grows, until a cap is reached |
| High-split or cap model | Agent keeps a large share of each transaction and pays a flat annual cap instead of an ongoing percentage |
| Flat transaction-fee model | Agent pays a fixed dollar fee per closed transaction rather than a percentage split |
| New-agent mentorship split | A newer agent may share a larger portion with a mentoring agent or team lead in exchange for support and leads |
These models are illustrative examples of how the industry commonly structures internal agent-brokerage arrangements, not a survey of any specific company, and any individual brokerage's actual terms are a private matter between that brokerage and its agents.
Is There a Standard Commission Split in Los Angeles?
No. There is no standard, typical, or expected commission or split in Los Angeles, and no board, association, or MLS sets or publishes one. The NAR Code of Ethics and decades of federal antitrust guidance have long prohibited any suggestion that a customary or standard rate exists (NAR). Any REALTOR who describes a "going rate" is describing their own practice or their brokerage's approach, not an industry rule.
This matters for a practical reason, not just a legal one: because every commission and every split is individually negotiated, a seller who assumes a number is fixed may never actually ask the question that gets them a better deal.
How Did the NAR Settlement Change How Commission Splits Work?
Two changes reshaped commission splits most directly. First, the MLS compensation-offer ban effective August 17, 2024 means the listing-side/buyer-side split can no longer be advertised through the MLS itself (NAR Settlement FAQs). Second, California's AB 2992, effective January 1, 2025, requires any buyer using an agent to sign a written agreement stating that agent's compensation no later than the execution of the buyer's purchase offer, with a conspicuous disclosure that the fee is not set by law and is fully negotiable.
A third, more recent change: the NAR Code of Ethics amendments effective January 1, 2026 narrowed a buyer's agent's compensation-disclosure obligations to their own client only, and capped arbitration awards to a buyer-representative at the amount stated in that buyer's own written agreement (NAR 2026 Summary of Key Professional Standards Changes). None of these changes touch the agent-brokerage split at all, since that arrangement was never part of the MLS or the settlement in the first place.
Can a Seller Refuse to Pay Any Buyer-Side Commission?
Yes. A Los Angeles seller can decline to offer any buyer-side concession at all, since nothing in current rules requires it. Some sellers choose this route to reduce upfront costs; others find that offering a buyer-side concession keeps a listing competitive among buyer's agents deciding where to show their clients homes.
Either choice is legitimate, and the right answer depends on the specific property, price point, and how competitive the Los Angeles submarket is at the time of listing. This is exactly the kind of strategic decision worth discussing directly with a listing agent rather than assuming one approach is always correct.
What Should Sellers Negotiate Before Listing?
- The listing fee itself. Ask directly what is included in the service and why the number is what it is.
- Whether to offer a buyer-side concession. Decide this deliberately rather than defaulting to whatever feels customary.
- What happens if the home is a hard sell. Clarify upfront whether terms adjust after a period on market.
- Cancellation terms. Understand how to exit the listing agreement if the relationship is not working.
None of these conversations require accepting a number because "that's just how it's done" in Los Angeles. Every part of the arrangement, from the listing fee to any buyer-side concession, is a negotiation between you and your agent (CA Civil Code Section 2079.14, agency relationship disclosure).
Frequently Asked Questions
What does "commission split" actually mean in a Los Angeles real estate sale?
The phrase covers two different splits: how compensation is arranged between the listing side and the buyer side of a transaction, and how an individual agent's own share is split with their brokerage. Both are fully negotiable and neither is set by any board, association, or MLS.
How is commission split between the listing side and the buyer side now?
Since MLS listings can no longer publish a buyer-broker compensation offer, the seller negotiates their listing agent's fee directly, and any buyer-side compensation is arranged separately, either as a seller concession negotiated in the purchase offer or paid by the buyer under their own written representation agreement.
How is commission split between an agent and their brokerage?
Individual brokerages set their own internal split structures with their agents, commonly ranging from an even share to a much larger share for the agent at higher-volume tiers, or a flat transaction fee model at some brokerages. These arrangements are private agreements between an agent and their brokerage, not something a seller or buyer typically negotiates directly.
Is there a standard commission split in Los Angeles?
No. No board, association, or MLS sets or publishes a standard commission or split, and any REALTOR who implies otherwise is describing their own or their brokerage's practice, not an industry rule. Every commission and every internal split is individually negotiated.
How did the NAR settlement change how commission splits work?
Since August 17, 2024, MLS systems can no longer publish a buyer-broker compensation offer, and buyers who use an agent must sign a written representation agreement stating that agent's compensation, effective under California's AB 2992 no later than the execution of the buyer's purchase offer.
Can a seller refuse to pay any buyer-side commission?
Yes. A seller can decline to offer any buyer-side concession, since nothing requires it after the settlement. That choice can affect how a listing is received by buyer's agents and their clients, which is a strategic question worth discussing with a listing agent before setting the terms.
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