Commission Calculation in Real Estate: How Agents Get Paid in India
When you buy or rent a property in India, the commission calculation, the percentage-based fee paid to a real estate agent for facilitating a property transaction. Also known as brokerage fee, it’s the engine that keeps the real estate market moving — but few people actually understand how it works. It’s not a fixed price. It’s not always paid by the buyer. And it’s not the same everywhere. In cities like Mumbai, Delhi, or Bangalore, agents typically earn between 1% and 2% of the property’s sale price. For rentals, it’s often one month’s rent — paid by the landlord, not you. That’s right: if you’re renting, you shouldn’t be paying the agent at all. Most landlords cover the fee because they’re the ones who want the property rented out fast.
But here’s what most people miss: real estate agent commission, the payment structure that rewards agents for connecting buyers and sellers in property deals. Also known as brokerage, it’s not just about closing the deal — it’s about trust, time, and transparency. A good agent doesn’t just show you listings. They handle paperwork, negotiate terms, verify documents, and even help you avoid scams. That’s why some agents charge less but deliver more. And why others charge more but vanish after the signature. In India, there’s no national law setting commission rates, so it’s all negotiable. Some agents offer flat fees. Others split the commission between buyer and seller. And in commercial deals — like office spaces or retail units — fees can go higher, sometimes up to 3% or more.
Don’t assume the agent works for you. They work for whoever pays them. That’s why it’s critical to ask upfront: Who’s paying the commission? If you’re buying, make sure you’re not being charged extra. If you’re renting, confirm the landlord is covering the fee. And if you’re selling, get it in writing — no vague promises. A clear brokerage fees, the charges imposed by real estate professionals for facilitating property transactions in India. Also known as agent fees, these are central to understanding cost structures in property deals. agreement saves you from surprises later. You don’t need to pay more just because the agent says so. Compare rates. Ask for a breakdown. And never sign anything without understanding the numbers.
What you’ll find below are real examples from people who’ve been there — from landlords in Chennai who paid nothing to agents, to investors in Hyderabad who negotiated 0.5% fees on a ₹5 crore property. You’ll see how commission calculation changes depending on whether you’re buying a resale flat, renting a villa, or investing in commercial space. No fluff. No theory. Just what actually happens on the ground in India’s real estate market — so you know exactly what to expect, what to ask for, and how to protect yourself.
How Math Is Used in Real Estate by Agents Every Day
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- October 30 2025
- Archer Hollings
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