When a seller in Newport Beach or Costa Mesa asks me what commission "is," they are usually asking a question that no longer has a single answer. The rules changed in August 2024, California added its own layer in January 2025, and the market has spent the time since sorting out what that means in practice. This is the current state of play, explained the way I explain it at a kitchen table. It is general education, not legal advice, and every number is negotiable, which is rather the point.
In this guide: What actually changed · California's own rule · Where compensation lives in the contract now · What sellers actually pay in 2026 · How to decide · Questions sellers ask
What actually changed
For decades a listing agent entered an offer of compensation to the buyer's agent in the MLS, and that number, typically a percentage of the price, was effectively set by the seller before any buyer appeared. The 2024 national settlement ended that practice as of August 17, 2024. Offers of compensation can no longer appear in the MLS, and buyers must sign a written agreement with their own agent before touring homes, spelling out what that agent will be paid. What did not change is that a seller can still choose to pay a buyer's agent, or to give the buyer a credit that covers it. The difference is that it is now a negotiated term in the offer rather than a standing promise in the listing.
California's own rule
California went a step further with AB 2992, effective January 1, 2025. A buyer's broker must have a written representation agreement to collect a commission, the agreement must state the compensation clearly, whether as a percentage, a flat fee, or an hourly rate, and it cannot run longer than three months without being renewed in writing. Brokers who skip the paperwork are deemed to have violated their license law. For sellers, the practical effect is that every buyer who walks through your door has already agreed, on paper, what their agent will be paid and by whom. Your offer will tell you whether they are asking you to cover it.
Where compensation lives in the contract now
On the California Residential Purchase Agreement, the buyer's request for the seller to pay the buyer's broker is a specific term, and the seller's agreement to do so is documented on its own form. The amount can be any figure the parties agree on. It is also separate from what the seller owes their own listing agent, which is set in the listing agreement before the home goes to market. Occasionally a buyer will add an unusual term, such as offering to pay the listing agent a bonus, which I covered in the offer term nobody talks about. Read every offer's compensation lines as carefully as its price, because they change your net.
Want to see how commission and closing costs change your bottom line? The seller net sheet lets you enter your own numbers, including whatever you decide to offer a buyer's agent, and shows what you keep.
What sellers actually pay in 2026
Here is the honest version. In coastal Orange County, most sellers of well-priced homes are still choosing to contribute toward the buyer's agent, because most buyers ask and because a buyer who has to pay their own agent out of pocket, on top of a down payment and closing costs at rates near 7%, has less to spend on the house. But "most" is not "all," and the amount is no longer a fixed convention. I have seen sellers agree to the buyer's full request, negotiate it down as part of a counter, offer a flat credit instead, or decline and accept a slightly lower price in exchange. On a luxury sale the percentages are smaller and the dollar figures larger, so a half-point difference on a $4 million Newport Coast home is $20,000 and worth negotiating with intent.
What I will not do is tell you a "standard" rate, because there is not one, and because the settlement was specifically about ending the idea that there is. What I can tell you is what buyers in your price range are asking for this quarter, what the offers on comparable homes have included, and what each choice does to your net.
How to decide
Think of buyer-agent compensation as one lever among several, alongside price, credits, repairs, and timeline. A seller who refuses to contribute anything may narrow the buyer pool in a market that already has fewer buyers. A seller who agrees to everything may leave money on the table. The middle path is to set a position before listing, based on the buyer pool at your price, and to treat each offer's request as a negotiable term rather than a given. Decide it with your net sheet open, not in the emotion of a multiple-offer weekend.
Questions sellers ask
Do sellers still pay the buyer's agent commission in California in 2026?
Often, but not automatically. Since August 2024 buyer-agent compensation cannot be offered in the MLS and is negotiated in the purchase contract instead. Many coastal OC sellers still agree to contribute because it widens the buyer pool, but the amount and whether to pay at all are negotiable terms in each offer.
What is AB 2992 and how does it affect home sellers?
AB 2992, effective January 1, 2025, requires California buyer's brokers to have a written representation agreement, with compensation clearly stated, in order to collect a commission, and limits the agreement's term to three months unless renewed in writing. For sellers, it means every buyer already has an agreement defining what their agent is owed.
Is there a standard real estate commission rate in California?
No. Commissions have always been negotiable, and the 2024 settlement specifically ended the practice of a standing offer of buyer-agent compensation in the MLS. Listing-side compensation is set in the listing agreement, and buyer-side compensation is negotiated offer by offer.
Can a buyer ask the seller to pay their agent in the offer?
Yes. The purchase agreement includes a term for the buyer to request that the seller pay the buyer's broker, and the seller can accept, counter, or decline it like any other term.
A note from Jade
Compensation is a business term, and I would rather you understand it than be told a number. Before you list, I will show you what buyers at your price are asking for, what your options are, and what each one does to your net, so the decision is yours and made with the facts. If you are 55 or older and the next move depends on carrying your tax base, that part of the plan comes first; see my guide to Prop 19 downsizing in Newport Beach.
Sources and further reading: NAR settlement practice changes · California DRE on AB 2992 · Brownstein on AB 2992 requirements · California Association of Realtors. Reviewed September 2026.
This is general real estate education, not legal advice. Compensation is negotiable and depends on the listing agreement and each offer. Before making a decision, confirm your specific situation with your broker, an attorney, or another qualified advisor.
