What is the Real Estate Commission in Tennessee?


|10 min read

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Tennessee culture is a mix of Southern hospitality, Appalachian mountain spirit, and a rich history of music and art. The vibrant state of Tennessee has seen a surge in population, which has grown by more than 11% over the past 12 years, and Tennessee real estate agents have been busy. While home prices for Tennessee real estate are lower than the national average, the commission rate is slightly higher. According to a survey of FastExpert agents, the average real estate commission in Tennessee is 5.8%; whereas, the national average is 5.57%.

If you’re buying or selling a house, what does this mean for you? What can you expect to pay Tennessee real estate agents?

When making any real estate transaction, you should understand the commission rate, or realtor fees, as this is the largest expense aside from the home itself. Read on to learn everything you need to know about the Tennessee real estate commission and feel empowered to make the best home decision for you.

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What is a commission rate?

The commission rate is a payment for the services provided by the real estate agent and is calculated as a percentage of the purchase price of the home.

Think of it as a tip at a restaurant. If your meal is $100 and you give your server a 20% tip, then the server would receive $20. Depending on the restaurant, sometimes these tips are divided between the various people that helped to make your meal experience possible.

Real estate transactions are similar. The total bill is the purchase price of the home, the tip is the commission, and this payment is divided between all the people that assisted during the real estate transaction.

>>DISCOVER: Top 25 Real Estate Agents in Tennessee

Who receives the commission payment?

The commission payment when purchasing Tennessee real estate is divided between four parties, the listing agent, the listing agent’s broker, the buying agent, and the buying agent’s broker.

Realtor Commission in Tennessee on an Average Home

What can I expect to pay in realtor fees in Tennessee? Remember, realtor fees and commission are interchangeable terms. Let’s take a look.

In Tennessee, the average real estate commission rate is 5.8%.

According to Redfin, the median sale price of a home is $360K.

Therefore, the average realtor commission payment in Tennessee is $20,880.

This Tennessee real estate commission payment is divided between the listing agent (seller’s agent), listing agent’s broker, buyer’s agent, and buyer’s agent’s broker. Typically the realtor fees are initially divided equally between the selling and buying agents.

Therefore, the seller’s agent’s broker would receive $10,440. The broker keeps a portion of the payment and gives the remainder to the listing agent.

The percentage of the commission that the realtor gets to keep is based on the realtor’s experience and performance, the type of home sold, the location, and the state of the housing market. While other factors can contribute to the commission, in general, real estate agents with higher qualifications get to keep a higher percentage of the commission.

In this example, the total commission payment was $20,880. This was divided equally between the real estate agents involved, with each receiving $10,440.

The listing agent earns 80% of the split and would receive $8,352. The listing agent’s broker would keep 20%, in the amount of $2,088.

The buyer’s agent may have less experience and earns 50% of the split. Therefore, the buyer’s agent commission would be $5,220. The broker would receive the same.

>>MORE: Finding local agents is easy with FastExpert

Who pays the real estate commission in Tennessee?

The seller typically pays the entire commission. While some of this cost can be rolled into the purchase price of the home, lessening the burden on the seller; it is the responsibility of the seller to pay the listing agent commission and the buyer’s agent commission. Therefore, it’s critical to calculate these costs in your real estate decision.

As a seller, this may seem unfair. Typically the buyer incurs the payment when making a purchase. Whether buying a meal or a car, the buyer pays the tip or commission.

However, it’s better to think that the home seller is buying the services of both real estate agents in order for the home transaction to occur. Real estate agents do a lot of behind-the-scenes work to market your house and get it sold.

>>MORE: Should I Sell My House Now?

Ask an Agent Your Questions

Buying and selling a home is a life-changing decision and is often filled with uncertainty and questions. We’re here to help! As a licensed FastExpert agent, any question with no obligation, only advice. Or search our advice page for help with all of your real estate needs.

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What’s Going On In The Tennessee Housing Market?

The Tennessee real estate market is currently in a state of flux. With the recent increase in mortgage rates and the market uncertainty across the United States, home values have decreased slightly in recent months.

However, the inventory of homes for sale is low. This is creating a competitive market for buyers, and homes are often selling over the asking price.

In addition, the population growth, strong economy, and the state’s low cost of living have contributed to a growing demand for homes in Tennessee. Regardless of what’s happening outside Tennessee, within Tennessee, this strong demand will continue to bolster home prices.

While the market may have called a bit, it is unlikely to see a significant slowdown. In the coming years, we expect to see home values rise, and buyers should be prepared to act quickly.

Why Are People Moving to Tennessee?

Tennessee has seen a boom in visitors and residents. The people of Tennessee are friendly and welcoming. They take pride in their state and make it a very comfortable place to live.


Tennessee’s rich culture, vibrant music scene, and unique venues draw people in. The state is home to some of the most iconic musicians in American history, including Elvis Presley, Dolly Parton, and Johnny Cash. Visit the Grand Old Opry or the Country Music Hall of Fame for a magnificent experience or walk down the Second Avenue District to find a bustling, local atmosphere of bars and clubs with live music.


Tennessee is also known for its delicious food, including barbecue, hot chicken, and biscuits and gravy. Country kitchens and Southern comfort food fill the plates of Tennessee restaurants, adding to the warmth of the state’s environment.

Strong Economy

Tennessee has a relatively low cost of living, making it an attractive option to live and work. In addition, the state is adding jobs at a faster rate than the national average, creating new opportunities for people who are looking for work. The low property taxes and zero state income tax also allow individuals to keep more of the income they earned.

Quality of life

Squished between Midwestern charm and Southern hospitality, Tennessee radiates comfort, community, and diversity. The cost of living is relatively low, and there are a number of excellent schools, making it a great option for families.

How to Find a Real Estate Agent

In order to find a real estate agent that’s a good fit for you, it’s important to do your research. Here are a few things to keep in mind:

  • Compare real estate agents on the FastExpert platform.
  • Ask for recommendations from friends and family who have recently bought or sold a home.
  • Check out online reviews of local agents.
  • Meet with multiple agents to get a feel for their personality and see if you click.
  • Ask each agent about their experience, marketing strategy, and what they would do to sell your home.
  • Make sure you’re comfortable with the agent’s commission rate before signing anything.

Work With the Best FastExpert Agents

At FastExpert, we make it easy to find a great real estate agent in your area. We have a team of experts who will work with you to find an agent that fits your needs and budget. Simply fill out a short survey and get matched with several agents that are a perfect fit for you.

Or browse the FastExpert directory of thousands of agents. Read reviews, check out ratings, and easily message agents to find the agent that clicks with you.


Real Estate Experts

FastExpert is a real estate agent directory that ranks agents by location according to client ratings and past home sales history. Our goal is to give you all the information you need to choose the right real estate agent for your needs. Users can search by specific traits that are important to them as well as see specific addresses of homes agents have sold in the past.

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