Kentucky Real Estate Commissions: What You Can Expect in 2024
Understanding the details of real estate commissions is crucial when buying or selling a home in Kentucky, as it plays a major role in shaping your budget and influencing negotiations. In 2024, updates to commission structures nationwide have enhanced transparency, giving buyers and sellers a clearer understanding of these fees. These changes are designed to help you better navigate the costs associated with real estate transactions.
Whether you’re a first-time homebuyer or a seasoned seller, this Redfin guide will walk you through Kentucky’s real estate commission structure and what to expect in the current market.
Current state of the Kentucky housing market
Before we discuss how real estate commissions work in Kentucky, it’s essential to take a look at the state’s broader housing market trends and current conditions that could influence your transaction.
Median Home Sale Price
$264,400
Housing Supply
15,978 (+15.9% YoY)
Homes Sold Above List Price
19.9% (-6 pts YoY)
Understanding real estate commissions in Kentucky
What are real estate commissions?
Real estate commissions are the fees paid to agents for their assistance in completing a property transaction. These fees are usually calculated as a percentage of the sale price and are paid when the deal closes. They cover the agent’s services and expertise throughout the buying or selling process.
Who pays the commission?
Traditionally, sellers have paid both their own agent’s commission and the buyer’s agent’s fees from the sale proceeds. However, starting August 17, 2024, new regulations will require buyers to agree in writing to their agent’s commission before starting any home tours.
Though buyers can still negotiate for the seller to cover their agent’s fees during the offer process, this new rule offers greater flexibility. It enables clearer negotiations on how much, if any, of the buyer’s agent commission the seller will contribute, giving both parties more control over the final arrangement.
Average real estate commission rates in Kentucky
In Kentucky, real estate commission rates can vary depending on transaction details and negotiations. While commission rates typically follow industry norms, they are negotiable, allowing buyers and sellers to establish a fee structure that meets their needs.
Factors like the home’s location, current market conditions, and the services offered by the agent can influence the commission rate. This flexibility helps both parties tailor fees to fit their budget and goals. The following breakdown shows typical commission rates based on median home prices in major Kentucky cities.
City
Median Home Sale Price
1.5% Real Estate Commission
3% Real Estate Commission
5% Real Estate Commission
Lexington
$330,000
$4,950
$9,900
$16,500
Louisville
$250,000
$3,750
$7,500
$12,500
Bowling Green
$295,900
$4,438
$8,877
$14,795
At Redfin, our goal is to provide exceptional value to consumers. For sellers, we offer a competitive listing fee starting as low as 1%.* For buyers, our fees vary by location but are designed to be competitive, helping your offer stand out and increasing your chances of success in the homebuying process.
Can you negotiate real estate commissions in Kentucky?
Yes, you can! There are no federal laws setting commission rates in the U.S., so agents are generally open to negotiating their fees. The flexibility in commission rates can depend on factors like the type of transaction, the services required, and the agent-client relationship.
When negotiating commission rates, consider:
The level of service provided by the agent
Their marketing strategies
Their experience in the local market
Sellers might have more leverage to negotiate lower rates if their property is expected to sell quickly or is in high demand.
Tips for a Successful Negotiation
Compare multiple agents and their commission structures before making a decision.
Discuss performance-based incentives, such as a higher commission for a quicker sale or a higher final sale price.
Leverage your property’s location if it’s in a sought-after area—agents might be more flexible with their commission rates.
Kentucky real estate commission FAQs
What are the changes to real estate commission? Two significant changes have impacted how commissions are communicated: First, buyers must now agree to their agent’s fees in writing before touring homes. Second, in many markets, agent compensation is no longer displayed on MLS listings. Learn more about the real estate commission changes here.
How do the changes impact buyers in Kentucky? Buyers must now sign an agreement with their agent that specifies the commission rate before starting home tours. Despite this, buyers can still negotiate with sellers to have their agent’s fees covered as part of the offer process.
How do the changes impact sellers in Kentucky? Sellers will continue to negotiate with their listing agent about the commission offered to the buyer’s agent, if any. Any requests or adjustments to these terms will be reviewed and negotiated accordingly.
How do you find a real estate agent in Kentucky? If you’re looking to buy or sell a home, Redfin is ready to assist. Reach out to a Redfin agent to start the process today.
How can you avoid fees? Selling a home on your own (For Sale By Owner, or FSBO) can help you avoid commission fees. However, FSBO transactions require considerable effort, including managing marketing, coordinating showings, and handling paperwork.
*Listing fee subject to change, minimums apply. Any buyer’s agent fee the seller chooses to cover not included. Listing fee increased by 1% of sale price if buyer is unrepresented. Sell for a 1% listing fee only if you also buy with Redfin within 365 days of closing on your Redfin listing. We will charge a 1.5% listing fee, then send you a check for the 0.5% difference after you buy your next home with us. Learn more here.
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