Welcome to the BeSmartee blog. Enjoy a wide selection of articles related to mortgages, the industry, and real estate.

San Francisco Real Estate: Commission Paid

By Arvin Sahakian · Oct 28, 2015 · Mortgage

San Francisco Real Estate: Commission Paid

Image courtesy of Google Images, Paul.h

San Francisco is well known for its Golden Gate Bridge and technology startups. This article will outline how many homes have sold in S.F. County, the total sales volume, and how much in commission brokers and real estate agents made.

San Francisco County, in northern California, is on the tip of a peninsula surrounded by the Pacific Ocean and San Francisco Bay. With an estimated population of 852,000, according to the U.S. Census Bureau, San Francisco is known for its hilly landscape, year-round fog, iconic Golden Gate Bridge, cable cars and Victorian houses.

As of late, San Francisco County has become better known in the business world for being the place where some of the most recently successful technology companies in the U.S. are calling their home for their businesses. San Francisco County is also known for its expensive real estate, in fact, the median price of homes are the highest they've ever been and the highest in the state of California.

San Francisco Real Estate Sales: Sept. 2014 - Sept. 2015

According to Redfin, a residential real estate company that provides web-based real estate databases and brokerage services since 2004, there were approximately 5,430 properties sold in the County of San Francisco within the last year. These properties only include Single Family Homes, Condominiums and Townhomes. The following chart breaks down how many of each property type were sold.

Number of Units Sold in San Francisco County From September 2014 - September 2015

Median Sales Price of Homes in San Francisco County

The median sales price of homes is derived by viewing a list of the selling price of properties, then taking the price that falls in the middle of the range from low to high. For example, if we are looking at a list of three properties that sold for $700,000, $750,000 and $800,000 respectively, then the median sales price would be $750,000.

With this in mind, the following table and chart breaks down and visualizes the median sales price of homes in the County of San Francisco on a monthly basis from August 2014 - August 2015 according to Zillow, an online real estate database founded in 2006.

Month/Year Median Sales Price
August 2014 $966,000
September 2014 $953,000
October 2014 $971,000
November 2014 $1,020,000
December 2014 $994,000
January 2015 $969,000
February 2015 $1,040,000
March 2015 $1,090,000
April 2015 $1,100,000
May 2015 $1,130,000
June 2015 $1,140,000
July 2015 $1,120,000
August 2015 $1,140,000

Median Sales Price of Homes in San Francisco County

"Average" Median Sales Price of Homes in San Francisco County

For our calculations, we summed up all the median sales prices in the table above to equal $13,633,000 and divided that sum by the 13 months in order to attain a single "average" median sales price over the past year, which equals $1,048,692.

We will take this average median sales price ($1,048,692) and multiply this number by the total number of units sold in the past year (5,430) in order to help us calculate an approximation of how much commission was paid by San Francisco real estate sellers to their brokers and agents.

Brokers Commission to Sell San Francisco County Real Estate

Based on our research, we have found that the majority of property sellers use the services of a traditional California real estate brokerage to help them list, market, negotiate and sell their properties. These sellers pay within a range of 4 - 6 percent of the final sales price as the commission fee.

For our intents and purposes, we will use the middle of range at approximate that sellers of Los Angeles real estate paid their brokers 5 percent of the selling price as a commission fee to sell their homes.

How Much Real Estate Did Brokers Sell in San Francisco County?

According to Redfin, approximately 5,430 single family homes, condominiums and townhomes were sold in the County of San Francisco within the past year. Considering the average median sales price of $1,048,692 mentioned above, and multiplying this number by the 5,430 units sold, we can estimate that San Francisco County real estate brokerages assisted their clients in selling a total of $5,694,397,560 of real estate within the past 12 months. Well over $5.5 billion.

Commission Paid to Brokers by Sellers in San Francisco County

So how much commission did sellers of these San Francisco County homes actually end up paying to their real estate brokers and agents in commission fees after all? To attain this amount, we simply take the $5.5+ billion figure from the total number of units sold mentioned above, and multiply this figure by a 5 percent commission rate:

$5,694,397,560 x 5% = $284,719,878

Finally! Based on our calculations, sellers of San Francisco County real estate paid their brokers and real estate agents approximately $287.7 million in real estate commission fees in the past 12 months.

Real Estate Commission: Explained, Revealed and Compared
By Arvin Sahakian · Aug 17, 2015 · Real Estate Data

Real estate agents receive commissions from home buyers and sellers, collectively earning over $50 Billion per year. Learn how commission amounts are set, who pays them, and how they work in this article. Read more.


California Property Tax: Complete List by County 2014-2015
By Tim Nguyen · Nov 26, 2014 · Real Estate Data

List of secured property tax rates for all counties of California fiscal year for 2014-2015. Read more.


California Proposition 60 and 90: Your Complete Guide
By Tim Nguyen · Nov 28, 2014 · Real Estate Data

If you live in California and are over the age of 55 you can effectively reduce your property taxes when buying a new home. Read more.


Houston vs. Dallas: Which One is Better to Live in?
By Amanda Curry · Oct 11, 2016 · Real Estate

Houston Vs. Dallas? If you are considering moving to either of these major metropolitan areas, we've created a resource to help you make the decision process a little easier. Read more.


What to Expect During the Home Loan Closing Process
By Arvin Sahakian · Feb 24, 2015 · Mortgage

You've heard the term used before, but what does loan closing mean? Find out all you need to know about the process. Read more.


5 Illegal Borrowing Activities: Things That Are Illegal When You Try to Get a Home Loan
By Laura Agadoni · Jan 22, 2016 · Mortgage

Whenever there is money to be made or money to be spent, some unscrupulous folks will take advantage, trying to game the system or commit all-out fraud. Read more.


The Surge in Foreign Real Estate Investment in the United States
By Laura Agadoni · Feb 24, 2016 · Real Estate

Foreign real estate investment in the United States, both commercial and residential, is a huge phenomenon that is only expected to accelerate, maybe even to skyrocket, in 2016. Read more.


Does Homeowners Insurance Pay Off your Mortgage if the House is Burned Down?
By Amanda Curry · Feb 8, 2017 · Mortgage

In this article, we explore how homeowners insurance works and what happens in the event of a house fire. Read more.


16 Ways to Improve Your Debt-to-Income (DTI) Ratio
By Veronica Nguyen · Nov 29, 2014 · Mortgage

Your DTI is used by mortgage lenders to determine whether you qualify for a loan, and if so, for how much. Improve your DTI with these 16 tips. Read more.


6 Creative Financing Solutions For Your Next Home Purchase
By Laura Agadoni · Mar 22, 2016 · Mortgage

In this article we explore some creative financing options for your next home purchase. Read more.