A July 2026 report from the Consumer Policy Center, “Junk”Fees Charged to Both Home Sellers and Buyers: An Overview”, written by Stephen Brobeck and Wendy Gilch, raises concerns about administrative, transaction, technology, and other fees charged to home buyers and sellers. The report says these fees are commonly between $400 and $600, although some reported examples exceed $1,000 and a few were above $2,000. Those numbers deserve attention, but they also need to be viewed in the proper context because the report does not establish the national frequency or average amount of these fees through a comprehensive database or statistically representative survey.
The authors openly acknowledge that they were unable to locate a publicly available source of industry-wide data. Their primary evidence came from several hundred comments made by real estate agents, brokers, and mortgage professionals, either directly to the authors or through social media sites including Facebook, TikTok, Reddit, Quora, and Instagram. Many of those sources were anonymous. The report did include some limited transaction examples, including 24 fee-bearing transactions from several states with fees ranging from $195 to $1,590, as well as 12 closings reported by a Midwestern broker, 11 of which included fees between $395 and $799. Those examples help show that the fees exist, but they are not a national sample that can establish how common they are. The report’s estimate that consumers pay nearly $2 billion annually is expressly based on an assumption that half of all buyers and sellers are charged an average fee of $500. In other words, the report identifies an issue worth examining, but its frequency and cost estimates should not be treated as precise measurements. The Complete report is available here.
From what I have seen in the real estate industry, transaction fees can work in several different ways. Some brokerages charge a per-transaction fee to the agent each time the agent closes a sale. The agent may absorb that charge out of the commission received or pass it along to the client, and at some companies it is common for the agent to pass it through. In that situation, the fee may simply reimburse the agent for a company charge rather than produce additional profit for the agent. In other cases, an individual agent or real estate team charges its own transaction or administrative fee on top of the commission and may retain some or all of it. Those are different arrangements, even though the fee may carry the same name.
I also do not believe a separately stated fee is inherently improper. Real estate agents and brokerages cannot work for free, and there are many legitimate ways to charge for professional services. Compensation may be based on a percentage of the sale price, a fixed fee, an hourly charge, a retainer, or some combination of those methods. In some business models, a flat transaction fee may be the only compensation received, making it difficult to fairly characterize that fee as a junk fee. Even when a fee is charged in addition to a commission, the label placed on one portion of the compensation does not tell the consumer whether the total charge is reasonable.
For example, on a $400,000 sale, one agent might charge a 1 percent commission of $4,000 plus a $2,000 transaction fee, resulting in a total cost of $6,000. Another agent might charge a 2 percent commission with no additional fee, resulting in a total cost of $8,000. The $2,000 transaction fee in the first example may sound excessive when viewed by itself, but the seller would still pay $2,000 less overall. For me, the real issue is transparency. Every commission, transaction fee, administrative fee, retainer, hourly charge, or other cost should be clearly disclosed in writing before the client commits, along with an explanation of the services being provided in return. A fee that unexpectedly appears shortly before closing is a legitimate concern. A fee that is fully disclosed from the beginning is part of the total compensation package the consumer can evaluate. Buyers and sellers should compare the total cost and services offered, and anyone who believes the charges are too high or not justified has plenty of other agents and brokerages to choose from.
