One year after the National Association of Realtors’ (NAR) settlement upended the way commissions are handled, buyer agent compensation is not falling as many predicted.
Instead, it’s creeping back up to pre-settlement levels.
According to a new Redfin report, the average U.S. buyer’s agent commission rose to 2.43% in Q2 2025, up from 2.38% a year earlier. That’s the third consecutive quarter of increases, bringing compensation back to where it was in the first quarter of 2024, before the settlement officially went into effect.
Byron Lazine put it simply on this week’s Real Word Podcast:
“One year in, Redfin—who hates agents earning a comp—they’ve got to publish the truth. And the stats don’t lie. Compensation is moving up.”
So why are buyer agent commissions on the rise? Let’s break down the data and the market dynamics driving it.
Redfin’s Key Findings on Buyer Agent Compensation
Redfin’s analysis looked at thousands of closed transactions from its agents, partner agents, and Bay Equity Home Loans. The results show a steady recovery in compensation levels after a brief dip immediately following the NAR settlement.
Here are the highlights from Q2 2025:
- National average: Buyer agent compensation was 2.43%, up from 2.38% a year earlier.
- Homes under $500,000: Compensation averaged 2.52%, the highest level since Q3 2023.
- Homes $500K–$999K: Compensation rose to 2.34%, up from 2.31% a year ago.
- Homes $1 million+: Compensation ticked up to 2.21%, up slightly from the previous quarter’s record low of 2.19%, but still below the 2.24% seen a year earlier.
The report also noted that in June, the U.S. housing market had 500,000 more sellers than buyers, the largest gap since 2013. With so few buyers, sellers are under pressure to offer competitive terms, including higher compensation, to close deals.
Why Predictions of a “Race to the Bottom” Fell Flat
When the NAR settlement took effect in August 2024, commissions initially dropped to a low 2.36% in the third quarter. Many believed this signaled the start of a downward slide.
But as Byron pointed out on The Real Word, those predictions underestimated how consumers actually behave:
“If consumers wanted no agent or less agent support…then you’d actually see comp moving down one year later. You’re not seeing that. You’re seeing that consumers value what we do. They seek it out. They prefer it.”
Nicole White added her perspective from the buy side when Byron asked what she’d never had the ability to do outside the last 12 months.
Her answer: “Negotiate what you’re going to get paid.”
Used to be whatever number was being offered on the MLS was the number buyer agents were taking. They might complain, but typically, most agents didn’t ask for more.
There were exceptions, though, as Nicole pointed out, describing one agent on her team who’d been in the business for a much shorter time and was asking for more than what was offered.
“I was flabbergasted that she was doing it, but she was able to do it because she was showing her value. So she definitely was on the bandwagon before any of this ever came on… If it was being offered, she was asking her clients for more.”
The lesson? When agents demonstrate value and outcomes, buyers are often willing to support higher compensation rather than shop for the lowest fee.
Local Market Dynamics
Redfin’s report also highlighted differences by market:
- In Austin, TX, most buyer agents now request 3%, up from 2.5%–2.75% before the settlement.
- In Kansas City, MO, sellers often ask about lowering or eliminating commission, but most still pay close to 3%when buyers request it.
- In Minneapolis, MN, buyers typically expect a 2.7% commission, though some flexibility has brought negotiated rates down to 2.5% in certain cases.
These examples reflect a broader point on the podcast: great agents with higher standards have raised the bar. And consumers are willing to pay more for a better experience, not to mention a better result.
What It Means for Agents
A year into the “new world” of compensation, and commissions are stabilizing or even rising in many markets. That signals opportunity for agents who can communicate their value and negotiate effectively.
Here are three takeaways for real estate professionals:
- The market rewards value. Agents who show measurable outcomes and provide clear expertise are more likely to secure higher compensation.
- Negotiation is now standard. With MLS rules changed, conversations around compensation are happening earlier and more directly.
- Market conditions matter. In buyer-heavy markets, agents may see more pushback. In seller-heavy markets, buyers and their agents often have leverage.
As Byron summed it up,
“There’s such an opportunity for agents to come in, especially in this new world, and really not only raise the bar but raise their earning opportunity.”
