How Much Do Realtors Make? (And What Do They Actually Do?)

A typical home sale includes a 6% commission, split between the buyer’s and seller’s agents—meaning both sides walk away with thousands of dollars, even if the buyer found the home online themselves. If you’ve ever wondered how much real estate agents make and what they actually do to earn it, you’re not alone. As buyers become more informed and tech-savvy, many are starting to question whether the traditional commission structure still makes sense—especially when it’s built into the price of the home.

Let’s break down exactly how real estate commissions work, what realtors do, and how you can save money by choosing a smarter model. (And yes, we’ll use California as an example—since that’s where TurboHome started—but these trends apply nationwide.)

How Much Do Real Estate Agents Make Per Transaction?

Real estate agents earn their income through commissions paid when a home sale closes. The typical total commission is 5% to 6% of the sale price, split equally between the buyer’s agent and the seller’s agent.

Here’s what that looks like on a $1,000,000 home sale:

• Total commission = $60,000 (at 6%)
• Buyer’s agent receives = $30,000
• Seller’s agent receives = $30,000

But it doesn’t stop there—most agents split a portion of that with their brokerage. If an agent gives 30% to their brokerage, their actual take-home for that one transaction is $21,000. That’s a significant paycheck, especially considering many buyers now do much of the initial search and evaluation themselves.

What Does a Realtor Do?

Realtors (also called real estate agents) guide clients through each stage of the homebuying process. For buyers, their support can be aligned with the following key phases:

1. Discovery:

• Helping define needs, lifestyle goals, and budget
• Setting up search alerts and navigating listings on the MLS
• Recommending neighborhoods and property types based on buyer criteria

2. Valuation & Analysis:

• Providing comparable sales (comps) to evaluate home prices
• Advising on current market conditions and offer competitiveness
• Estimating long-term value and potential resale concerns

3. Touring & Evaluation:

• Scheduling private showings and attending open houses
• Pointing out structural issues, layout pros/cons, and red flags
• Helping compare shortlisted homes beyond surface-level features

4. Offer & Negotiation:

• Crafting an offer strategy (price, contingencies, timing)
• Handling all communication with the listing agent
• Negotiating terms and price adjustments based on buyer’s goals

5. Due Diligence:

• Reviewing disclosure packets and inspection reports
• Coordinating with specialists (e.g. inspectors, contractors) if needed
• Advising on what’s normal wear vs. red flag risks

6. Closing Coordination:

• Working with lenders, escrow, and title companies
• Ensuring paperwork and contingencies are met on schedule
• Supporting buyers through final walkthrough and closing day logistics

Realtors provide structure and strategy at every step—but in today’s market, many buyers are already doing much of the early work themselves. That’s why it’s important to evaluate whether your agent adds value across all phases—not just unlocking access to listings.

How Do Real Estate Commissions Work?

When a home is sold, the seller typically agrees to pay the full commission—usually 5% to 6% of the purchase price. This amount is then split between the seller’s agent and the buyer’s agent. Here's what that looks like:

• Buyer pays money for a property
• Seller takes this money and gives a portion of the cash to the real estate agents
• Commission is split between buyer’s agent and seller’s agent
• Each agent pays a portion to their brokerage

The commission is taken out of the seller’s proceeds at closing. From the buyer's perspective, it might feel "free" because they aren't writing a check—but that cost is baked into the price of the home.

How Much Commission Do Real Estate Agents Actually Take Home?

Let’s look at an example for a $1.5M home sale:

• Total 5% commission = $75,000
• Buyer’s agent receives $37,500
• After splitting with their brokerage (say 30%), they net $26,250

That’s a big paycheck, especially if you, the buyer, found the home online, visited it on your own, and already knew what you wanted.

So, Is There a Better Way? (Yes: TurboHome)

TurboHome offers a modern alternative: a flat fee based on the price of the home—so you always know what you're paying upfront.

TurboHome Flat Fee Pricing Tiers:

• $0–$1M home: $7,500 flat fee
• $1M–$2M home: $10,000 flat fee
• $2M+ home: $15,000 flat fee

Compare that to a traditional 2.5% buyer’s agent commission:

• $1M home = ~$25,000
• $1.5M home = ~$37,500
• $2.5M home = ~$62,500

TurboHome saves you thousands.

And because sellers don’t have to shell out a high buyer’s agent commission, your offer can be more attractive—giving you more leverage in a competitive market.

You still get full-service representation—everything a traditional agent provides, from offer strategy to closing coordination—just without the unnecessary commission costs.

Here’s how a flat-fee model benefits you:

• You're in control of where your money goes. Instead of the traditional ~2.5–3% buyer agent commission being baked into the sale price, you pay a simple flat fee, which is often much lower.
• You can save or negotiate. This gives you the option to:
  
  • Offer the seller a better deal (by reducing the amount they have to pay out),
  • Or negotiate a cash-back credit or price reduction — effectively putting money back in your pocket.

So while the traditional model hides the cost, a flat-fee approach makes it transparent—and that can lead to real savings for you.

‍The Bottom Line

Traditional real estate commissions are expensive, outdated, and often don’t reflect the buyer’s actual experience. With TurboHome’s flat-fee model, you get full-service support and serious savings—without sacrificing quality.

Looking for a smarter way to buy? Let’s talk.