Tennessee realtor fees average approximately 5.59% of the home’s sale price, split between the listing agent and the buyer’s agent. On a $420,600 home, that works out to roughly $23,500 coming out of the seller’s proceeds at closing. The seller pays that fee in the vast majority of transactions, with no upfront cash required.
This guide covers how commission is calculated in Tennessee, how the money flows from seller to agent to brokerage, what the 2024 NAR settlement changed about who pays what, and how to reduce or avoid the fee entirely.
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Average Real Estate Commission in Tennessee
According to statewide commission survey data from ListWithClever (updated September 2026), the total average realtor commission in Tennessee is 5.59% of the sale price. That figure is split roughly in half: the listing agent’s side averages about 2.81% and the buyer’s agent’s side averages about 2.78%.
Tennessee’s average sits slightly above the national range of 5.46% to 5.70% reported by multiple commission tracking sources.
What the total fee covers
The listing side covers pricing strategy, photography, MLS placement, marketing, showings, offer negotiation, and closing management. The buyer’s agent side covers property search, comparative market analysis, offer negotiation, and transaction management through closing. Both sides are paid from the seller’s proceeds at the same closing appointment.
Listing agent fee vs. buyer’s agent fee
| Side | Average Rate | Role |
|---|---|---|
| Listing agent | ~2.81% | Markets and sells the property for the seller |
| Buyer’s agent | ~2.78% | Represents the buyer through search and closing |
| Total | ~5.59% | Paid by seller from proceeds at closing |
Rates reflect ListWithClever’s Tennessee survey, September 2026. Commission rates are not fixed by law and vary by agent and transaction.
Commission at different sale prices
The table below shows illustrative commission totals at the stated 5.59% average. These are calculations, not verified transaction data.
| Sale Price | At 5.59% Total | Listing Side (~2.81%) | Buyer Side (~2.78%) |
|---|---|---|---|
| $300,000 | $16,770 | $8,430 | $8,340 |
| $400,000 | $22,360 | $11,240 | $11,120 |
| $500,000 | $27,950 | $14,050 | $13,900 |
Illustrative calculations at the stated average rate. Actual commission depends on the negotiated rate for your transaction.
How Real Estate Commission Works in Tennessee
A real estate commission is a percentage of the final sale price, agreed upon before the home is listed. The seller pays the full amount at closing from the sale proceeds. No money changes hands before closing.
What the commission percentage is based on
The commission applies to the final sale price, not the list price. If you list at $410,000 and accept an offer at $395,000, the commission calculates on $395,000. Agents and sellers agree on the rate in the listing agreement, and it is legally binding once signed.
How the split flows from seller to agent to brokerage
The seller’s closing disclosure shows the total commission as a line item. At closing, the title company distributes it to each agent’s brokerage. Each brokerage then pays the individual agent their share based on their brokerage agreement, per how agent commission splits work as described by US Realty Training.
Individual agents typically keep 60% to 70% of their side after the brokerage’s cut, though split arrangements vary by brokerage and agent agreement. The figures below are illustrative examples based on a common 70/30 split; actual splits vary.
Who actually receives the money
On a $400,000 sale at 5.59%, total commission = $22,360. Here is how that flows illustratively through a 70/30 brokerage split:
| Party | Share | Illustrative Amount |
|---|---|---|
| Listing brokerage (30%) | 30% of $11,180 | ~$3,354 |
| Listing agent (70%) | 70% of $11,180 | ~$7,826 |
| Buyer’s brokerage (30%) | 30% of $11,180 | ~$3,354 |
| Buyer’s agent (70%) | 70% of $11,180 | ~$7,826 |
All figures are illustrative calculations. Brokerage splits are individually negotiated and can range from 50/50 to 90/10 or higher for experienced agents.
Who Pays Realtor Fees in Tennessee?
In Tennessee, the seller pays the full realtor commission from the sale proceeds at closing. Buyers do not write a separate check for their agent’s fee, though the 2024 NAR settlement changed how that arrangement is structured.
Traditional model: seller covers both sides
Before August 2024, the listing agent published a pre-set buyer’s agent commission offer in the MLS. Buyers saw homes listed and assumed their agent was already being paid. The seller funded both sides without a separate negotiation.
After the 2024 NAR settlement: what changed
The NAR settlement details that took effect in August 2024 made two structural changes. First, MLS platforms eliminated the field where sellers could advertise buyer’s agent compensation. Second, buyers must now sign a written buyer representation agreement that specifies their agent’s compensation before viewing any property.
Sellers can still choose to offer a concession covering the buyer’s agent fee. Many do, because it attracts more buyers. But it is now a negotiated item, not a built-in default.
Before/after comparison table
| Item | Before Aug 2024 | After Aug 2024 |
|---|---|---|
| Who pays buyer’s agent | Seller (via MLS offer) | Negotiated; buyer or seller |
| MLS commission offer field | Required | Eliminated |
| Buyer representation agreement | Optional | Required before showings |
| Seller’s typical exposure | Full 5% to 6% | Listing side + optional concession |
| Negotiability | Informal | Formally required in writing |
Based on NAR settlement terms effective August 17, 2024.
Tennessee also imposes a real estate transfer tax on the seller, assessed at $0.37 per $100 of sale price (verify current rate against the Tennessee Department of Revenue before closing). On a $400,000 sale, that equals approximately $1,480. The Tennessee Real Estate Commission licenses and regulates agents in the state but does not set commission rates.
Is 6% Realtor Fee Normal in Tennessee?
No, 6% is no longer the typical rate in Tennessee. The current average is closer to 5.59%, and most Tennessee transactions fall between 5% and 6% total. Six percent was the widely cited historical benchmark when a 3% split to each agent was standard practice.
Where the 6% figure came from
The 6% figure emerged as an informal industry norm, with each agent receiving 3%. It was never set by law. National commission rate data from Bankrate (updated May 2026) shows rates in the range of 2.5% to 3% per agent side, placing the total below the old 6% threshold in most markets.
Federal Reserve research on broker compensation trends published in May 2025 found that commission rates have declined over time as competition, technology, and buyer representation reforms reshape the market.
What Tennessee sellers actually pay today
The listing agent average in Tennessee is approximately 2.81% and the buyer’s agent average is approximately 2.78%, per the ListWithClever Tennessee survey. Both are slightly below the old 3% per side baseline. Rates are fully negotiable and not fixed by law in Tennessee. Federal antitrust rules prohibit agents or associations from setting standard rates.
Is 3% normal for one agent?
Three percent per agent side remains within the normal range in Tennessee, and you may encounter agents who hold at 3%. But the current statewide average per side is slightly below 3%, meaning there is room to negotiate. Whether 3% is competitive for your transaction depends on the price of your home, market conditions in your area (Nashville, Memphis, Knoxville, and Chattanooga can each differ), and the agent’s service model.
How Much Does a Realtor Make on a $300,000 House?
At Tennessee’s average total commission of 5.59%, the total fee on a $300,000 home is approximately $16,770. The figures below are illustrative calculations based on that rate, not verified transaction data.
Total commission at $300K
| Commission Rate | Total Fee on $300,000 |
|---|---|
| 5% | $15,000 |
| 5.59% (TN average) | $16,770 |
| 6% | $18,000 |
How that splits between agents and brokerages
At 5.59%, each agent’s brokerage receives approximately $8,385. The individual agent’s take depends on their brokerage agreement. A 70/30 split is a common reference point, though arrangements vary significantly.
What the individual agent takes home
Using a 70/30 brokerage split as an illustrative example:
- Listing agent’s brokerage share: $8,385 total
- Individual listing agent’s cut (70%): approximately $5,870
- Buyer’s agent individual cut (70%): approximately $5,870
Agents also pay self-employment taxes, brokerage fees, MLS dues, errors and omissions insurance, and marketing costs from that amount. The net income per transaction is typically well below the gross commission.
How to Reduce Realtor Fees in Tennessee
Negotiate directly with your agent
Commission rates in Tennessee are fully negotiable before you sign a listing agreement. Sellers with higher-priced homes have more leverage because the dollar amount is larger even at a reduced percentage. Negotiating just 1 percentage point off a 5.59% rate on a $400,000 home saves approximately $4,000 (illustrative calculation). Ask agents to clarify what services are included at any reduced rate before signing.
Use a discount or flat-fee brokerage
Discount brokerages typically charge a listing fee in the range of 1.5% to 1.75% rather than the full 2.81% listing-side average. That gap represents real savings on a $400,000 home: at 1.5% vs. 2.81%, you save roughly $5,240 on the listing side alone.
Flat-fee MLS listing in Tennessee services charge a one-time upfront fee, commonly in the range of $300 to $900, to place your home on the MLS without a percentage-based listing commission. You handle pricing, showings, and negotiations yourself.
Sell without a listing agent (FSBO)
Selling your home yourself eliminates the listing agent’s approximately 2.81% fee entirely. On a $400,000 home, that saves roughly $11,240. The trade-off is that you take on all tasks the listing agent would handle: pricing research, photography, MLS access (usually through a flat-fee service), showings, negotiation, and contract management. Most FSBO sellers still offer a buyer’s agent concession to attract buyers.
Skip the MLS entirely with a cash buyer
Selling directly to a cash buyer eliminates both the listing commission and the buyer’s agent concession. iBuyer.com connects Tennessee sellers with competing cash offers from vetted buyers, with closings in as few as 7 days and no listing agent fee.
Does the Seller Pay Closing Costs in Tennessee?
Yes. Sellers in Tennessee pay closing costs at the same appointment as the commission, though the two are separate line items on the closing disclosure. Commission is not technically classified as a closing cost under Tennessee real estate conventions.
What sellers pay at closing (beyond commission)
Beyond agent commission, seller-side closing costs in Tennessee typically include:
- Real estate transfer tax (see below)
- Owner’s title insurance (if paid by seller, varies by county custom)
- Deed preparation fees
- Recording fees
- Prorated property taxes through the closing date
- HOA transfer fees (if applicable)
Non-commission closing costs for sellers typically range from 1% to 3% of the sale price, though amounts vary by transaction.
Tennessee transfer tax explained
Tennessee charges a real estate transfer tax of $0.37 per $100 of sale price, customarily paid by the seller. On a $400,000 sale, that equals approximately $1,480. Verify the current rate and any applicable county surcharges with the Tennessee Department of Revenue or your closing attorney before relying on this figure.
Total seller-side closing cost estimate
| Cost Category | Typical Range |
|---|---|
| Agent commission (listing + buyer concession) | ~5% to 6% of sale price |
| Transfer tax | $0.37 per $100 (approx. 0.37%) |
| Title and deed fees | $500 to $1,500 |
| Prorated taxes and HOA fees | Varies |
| Total seller-side estimate | ~7% to 10% of sale price |
These are general ranges for Tennessee. Your actual closing disclosure will itemize each cost. Consult a licensed Tennessee closing attorney or title company for transaction-specific figures.
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Frequently Asked Questions
Realtor fees in Tennessee average approximately 5.59% of the home’s sale price, split between the listing agent (about 2.81%) and the buyer’s agent (about 2.78%), per ListWithClever’s Tennessee commission survey (September 2026). On a $400,000 home, that equals roughly $22,360. Rates are not fixed by law and vary by agent, market, and negotiation.
In Tennessee, the seller typically pays the full commission from the sale proceeds at closing, with no upfront out-of-pocket cost. After the August 2024 NAR settlement, buyers must sign written compensation agreements with their agents before viewing property, and the seller’s obligation to cover the buyer’s agent fee is now negotiated, not automatic.
A 6% total commission is at the high end of the current range; the Tennessee average is closer to 5.59%. Six percent was the historical benchmark when each agent earned 3% per side. Most Tennessee transactions today fall between 5% and 6%, and all rates are negotiable.
Three percent per agent side is within the normal range in Tennessee, but current statewide averages sit slightly below that, at approximately 2.78% to 2.81% per side. Whether 3% is competitive for your transaction depends on home price, local market conditions, and the agent’s service model.
At a 5.59% total commission, the total fee on a $300,000 Tennessee home is approximately $16,770, split between both agents’ brokerages. After a typical 70/30 brokerage split, each individual agent might net roughly $5,870 before taxes and business expenses. These are illustrative calculations at the stated average rate.
Yes, sellers in Tennessee pay closing costs, which typically total 7% to 10% of the sale price when agent commissions are included. Beyond commission, seller costs include the Tennessee transfer tax ($0.37 per $100 of sale price), title fees, deed preparation, and prorated property taxes. Verify the current transfer tax rate with the Tennessee Department of Revenue before closing.
Yes, Tennessee law does not set a standard commission rate, and federal antitrust rules prohibit price-fixing among agents. Sellers with higher-priced homes, strong market conditions, or willingness to handle some tasks themselves have more negotiating leverage. Always confirm the negotiated rate and included services in writing before signing a listing agreement.
The August 2024 NAR settlement eliminated MLS commission offers to buyer’s agents and required buyers to sign written compensation agreements before viewing any property. Sellers no longer have a default obligation to cover the buyer’s agent fee, though many still offer a concession to attract buyers. It is now a negotiated item rather than an assumed cost.
A listing commission in Tennessee typically covers pricing strategy, MLS listing, professional marketing, showings coordination, offer negotiation, and closing management. Buyer’s agent commission covers property search, comparative market analysis, offer negotiation, and transaction management through closing. Services and included marketing vary by agent and brokerage.
Alternatives include negotiating a reduced rate, using a flat-fee MLS service (typically $300 to $900 upfront), hiring a discount broker (often a 1.5% to 1.75% listing fee), selling FSBO, or selling to a cash buyer without any agent. Each option involves trade-offs in service, time, and risk. FSBO eliminates the listing commission but requires the seller to handle marketing, negotiations, and paperwork independently.
iBuyers do not charge a traditional percentage commission; they make a direct cash offer and apply a service fee without requiring a MLS listing. For sellers who prioritize a fast, certain close over maximizing sale price, this model eliminates agent commission as a transaction cost. The offer price itself reflects the buyer’s acquisition cost and margin.
No, realtor fees and closing costs are paid at the same closing appointment, but they appear as separate line items on the closing disclosure. Commission is not technically classified as a closing cost in Tennessee. This distinction matters when comparing net proceeds across different sale scenarios.
Reilly Dzurick is a licensed real estate agent with over six years of experience and a member of the iBuyer.com Market Insights Team, covering national trends in home selling and the evolving iBuyer landscape. Her firsthand experience working with buyers and sellers gives her a practical perspective on how these platforms impact real homeowners. She holds a degree in Public Relations, Advertising, and Applied Communication.
