The average real estate commission in Tennessee

Realtor commission fees are an inevitable part of selling a home in Tennessee, yet many people aren’t sure exactly how much they’re paying when the dust settles. In 2024, the average Tennessee Realtor commission rate sits at approximately 5.58%, higher than the national average of 5.49%. And while it might seem nominal, that figure can add up to tens of thousands of dollars depending on the final sale price of the property!

Commission fees aren’t just empty charges — they cover essential services like marketing your home and guiding the process to a successful closing. Regardless of the final cost, it’s worthwhile to understand how these fees work — and how you might save on agent costs without compromising your home sale.

What is the Tennessee Realtor commission rate?

The typical Tennessee Realtor commission rate for 2024 is approximately 5.58%. Generally, this percentage is divided between the listing agent and the buyer's agent, with the seller bearing the cost for both. For example, if your home sells for $300,000, you could expect to pay about $16,620 in total commission fees. These costs are deducted from the total selling price at closing, and they’re meant to cover the services provided by the agents involved in the transaction.

It's important to remember that while the 5.58% rate is a common standard in The Volunteer State, it’s not set in stone. The final percentage you pay is the product of both controllable and uncontrollable variables. Factors like market trends, location, and property specifics can influence the final amount. Commission rates also vary from agent to agent, and they’re negotiable (to an extent). 

Why do agent fees fluctuate?

Realtor commission fees in Tennessee can vary based on several factors. First and foremost, market conditions play a huge role. In a hot seller’s market, where homes are snapped up quickly, agents might lower their commission rates knowing that it’ll take less time and effort to sell a home. Conversely, in a buyer’s market — where properties linger longer — agents may increase their fees to account for the extra time and resources needed to find a buyer and close the sale.

Location also matters. Homes in high-demand cities like Nashville or Knoxville may have more competitive commission rates, while those in less populated or rural areas may come with higher fees due to the increased effort to attract buyers. 

Commission costs can also change depending on the agent or agency you’re working with. Experienced agents with access to better resources might come at a premium, while new agents hungry for experience and testimonials might accept a lower cut of the profits. 

Key factors that affect agent commission in Tennessee

While there’s not likely to be a significant deviation from the 5.58% average, there are some circumstances that can impact commission rates. Some of the biggest drivers of higher or lower rates include:

• Local market demand: If you’re in a high-demand area where homes sell quickly, agents may be more willing to negotiate lower commissions because they expect a quicker transaction. Conversely, homes in slower markets may command higher fees due to the additional time and effort needed to attract a buyer and shepherd them towards a sale.
• Property condition: Well-maintained homes — especially those with modern amenities and updated features—tend to sell faster and for higher prices. This can make agents more inclined to lower their commission, knowing that the sale will likely require less effort. If your home practically sells itself, you may be able to leverage it into both a better selling price and a lower commission rate! 
• Previous working relationships: If you’ve had a successful experience with a Realtor before or have previously referred them business, an agent may be inclined to give you a friendly discount. Just keep in mind that real estate agents depend on this commission!

How to save money on real estate commission in Tennessee

There are plenty of negotiables when it comes to transacting property, and Realtor fees are one of them. Before you start officially working with an agent, take a moment to understand their commission rate. Here are a few strategies to help you save:

• Negotiate with your agent: Many real estate agents are open to discussing commission rates, especially if the home is expected to sell quickly. Be transparent about your expectations and see if they’re willing to adjust their fee.
• Interview multiple agents: Don’t settle on the first agent you meet. Talk with several Realtors to compare their services, fees, and experience. This gives you a clearer picture of the options available and might help you negotiate a better deal.
• Consider alternative service options: If you’re comfortable marketing your own home, you might opt to work with a limited-service agent. These agents typically offer only essential services (MLS listing and paperwork handling) at a lower commission rate.

Learn how to list on the MLS without a Realtor.

FAQs 

A few common questions tend to pop up when discussing Realtor fees. Keep these FAQs in mind during your next transaction, so you can feel more confident as you move forward with your home sale or purchase.

How do Realtors get paid in Tennessee?

Realtors in Tennessee are typically paid from the proceeds of the home sale at closing. The commission — which is agreed upon when the property is listed—is deducted from the final sale price and divided between the listing agent and the buyer’s agent.

Does a buyer cover Realtor fees in Tennessee?

No, buyers in Tennessee don’t directly pay Realtor fees. Instead, the seller covers the commission for both the listing agent and the buyer’s agent, covered by the proceeds of the sale. However, these fees are often factored into the overall price of the home, meaning buyers may still indirectly share in the cost.

Can I sell my home without an agent in Tennessee?

Yes, it’s possible to sell your home without using a Realtor, often referred to as “For Sale By Owner” (FSBO). However, while this can save you on commission fees, it comes with challenges. You’ll be responsible for marketing, pricing, negotiating, and handling all legal paperwork. Many homeowners find that the time, effort, and expertise required make hiring a Realtor worth the commission — especially in competitive markets like Nashville.

Are Realtor fees negotiable in Tennessee?

Yes, Realtor commissions are negotiable in Tennessee! While the standard rate here is around 5.58%, agents are often open to discussion, especially if market conditions are favorable or the property is expected to sell quickly. Don’t hesitate to ask for a lower rate, particularly if your home has strong selling points.

Getting more from your Tennessee home sale

The average Tennessee Realtor commission of 5.58% might seem like a hefty cost, but knowing how to negotiate—and knowing what you’re getting for your money — can make all the difference. Whether you’re selling in booming Nashville, Knoxville, or a quieter rural spot, smart commission management will help you feel good about paying your Realtor for everything they do to help you sell your home. 

Here’s how else to save on realtor Fees.