Real estate commissions in California are typically paid by the seller at closing, from the proceeds of the home sale. In a standard transaction, the seller agrees to pay a total commission that is then split between the listing broker and the buyer’s broker, and each broker may further share part of that amount with their agents according to their brokerage agreement. Buyers usually do not pay the commission directly. Start your journey with LEAP's California real estate pre-licensing course.

In California, the commission amount is not fixed by law. It is negotiated in the listing agreement and can vary based on the property, market conditions, and the services included. While many transactions use a percentage of the sale price, the exact structure can differ. What matters most is that the commission terms are clearly agreed to in writing before the home is sold.

Timing also depends on the closing process. Commissions are generally paid only when the transaction successfully closes, meaning the seller has completed the sale and the escrow company disburses funds. If a deal falls through before closing, the commission may not be earned unless the brokerage agreement says otherwise. For new licensees, it’s also important to understand that commission income is shared with the brokerage, so your take-home pay depends on your split and any desk or transaction fees.

If you’re exploring a California real estate license, it helps to learn how commissions work early, since compensation, contracts, and agency relationships are central to the job. A California real estate pre-licensing course can give you the foundation you need before you start taking clients. You can find a helpful starting point at Leap Real Estate’s California pre-licensing course page as you move toward licensing and your first transactions.