09/02/2026
Between the Property Owner and the Tenant or Buyer, Who Should Pay the Agency Fee?
Agency fees remain one of the most debated issues in real estate transactions. Many tenants and buyers often ask: “Why am I paying for a service I did not directly engage?”
On the other hand, property owners argue that agents help them secure reliable occupants and close transactions faster.
Here’s the key point that is often misunderstood:
Agency fee is traditionally the responsibility of the party who engaged the agent.
In a standard real estate practice:
If a property owner hires an agent to market, manage, or lease a property, the owner should pay the agency fee.
If a buyer or tenant independently engages an agent to search, negotiate, or advise on a property, then the buyer or tenant is responsible for that fee.
However, in many markets, especially where housing demand exceeds supply, the cost of agency services is frequently transferred to tenants and buyers, not because it is legally required, but because market dynamics allow it.
This practice has created confusion, frustration, and in some cases, distrust within the real estate industry.
The way forward is clarity and transparency:
- Who engaged the agent?
- What service is being provided?
- What was agreed before the transaction began?
When agency fees are clearly defined and properly allocated, everyone wins:
- Property owners receive professional representation
- Tenants and buyers understand what they are paying for
- Agents maintain credibility and professionalism
Real estate works best when value, responsibility, and compensation are aligned.
What’s your view? Should agency fees be paid by the owner, the occupier, or shared?
— Oyenike Solomon (Amas)