Multifamily Broker Commissions: How Direct Buyers Pay

By Jose Diaz Caro, Founder of Kallpa Properties Published: 2026-08-27 | Updated: 2026-08-27 Estimated read: 8 min

Brokers ask me the same question at some point in every first conversation: "If I bring you a deal directly, do you honor the commission?" The short answer is yes, in full, written into the PSA before we start due diligence. But there is more nuance to how commission structures work in a direct-buyer deal than most brokers expect, especially on multifamily. Here is how it actually works at Kallpa.

How does commission work when a broker brings a deal to a direct buyer?

In a listed multifamily sale, commission is typically negotiated between the seller and the listing broker, then split (or not) with a buyer's rep at closing. The total usually runs 3-5% of the purchase price, depending on the property's size and complexity.

When a broker brings a deal directly to Kallpa, the structure is simpler. There is no listing agreement and no listing-side split. The broker who originates the deal earns the full agreed commission, and that figure goes into our LOI on the first pass. We don't leave it vague or defer it to "what's standard in this market." We agree on it in writing before we order title.

On a typical Wichita 5-to-20-unit deal, the commission range I see runs from 2% to 4% of the purchase price, depending on the broker's representation agreement with the seller and the deal's complexity. For transactions above 20 units or above $2M, the rate tends to compress slightly, which is consistent with what I see across the Kansas and Washington multifamily markets we cover.

One point worth knowing: the Kansas Real Estate Commission requires that broker compensation agreements be documented in writing. In a direct-buyer transaction, that written record is typically the seller's representation agreement with the broker. We reference the agreed dollar amount in the PSA as a third-party payment obligation, which is clean for title and for both parties' records.

How Kallpa handles broker commission in our PSA

Our purchase and sale agreement has a clear line for broker compensation: "[Broker name] shall receive a fee of $[X] payable by Seller at closing from sale proceeds, per a separate representation agreement between Seller and Broker."

We do not embed conditional language, earnest-money offsets, or inspection contingencies that can reduce the payout. The commission figure is locked at LOI. If the inspection changes the deal economics, we renegotiate the purchase price and nothing else.

This matters in practice. I have heard from brokers who have worked with other direct buyers where the commission ended up subject to informal adjustments after due diligence. We don't operate that way. We keep what a broker earns completely separate from how we manage deal risk. Mixing the two creates a misaligned incentive: if a broker knows their fee is at risk during due diligence, they manage information about the property differently. We would rather have full disclosure and a clean commission.

If you're a broker working with a seller who has not yet signed a representation agreement with you, we'll work with whatever structure you and the seller agree on. We don't impose a house form. You handle the representation agreement; we honor it at closing.

Does selling to a direct buyer mean a lower broker commission?

This is the most common misconception I hear. Brokers sometimes assume that because there is no buyer's agent to split with, the seller will pocket the difference rather than pay the originating broker a full commission.

In practice, the opposite tends to hold. When a broker brings Kallpa a deal directly, the seller is accessing a faster, cleaner path to close: no showings, no inspection renegotiations that drag on for weeks, no buyer financing contingencies that collapse the deal at week three. A seller who understands that value is generally willing to pay full commission for the broker who made it possible.

We also do not pressure a seller to reduce broker compensation as part of our offer. If a seller wants to adjust commission on their own initiative, that is their business and their right. We do not use it as a negotiating lever, and we do not bring it up.

What does the commission math look like on a deal?

Worked example (illustrative, not from a specific transaction; the mechanics are real): a Wichita 18-unit with gross rents of $13,500 per month, valued at $810,000 in our underwrite. A broker introduces the deal and the agreed commission is 3%, or $24,300.

When we underwrite a broker-sourced submission at this price point, we model two payment structures upfront so the seller can choose the one that fits their closing math.

Seller-pays structure. Gross purchase price $810,000. Broker receives $24,300 at recording. Seller nets $785,700 before taxes and any existing debt payoff. Our acquisition cost: $810,000.

Gross-up structure. Gross purchase price $834,300 (our net $810,000 plus the $24,300 fee). Broker receives $24,300 at recording. Seller nets $810,000 before taxes and debt payoff. Our net acquisition cost is $810,000 in both cases.

The second structure shifts the source of the commission from the seller's net to our acquisition cost. We are flexible on this. Some sellers prefer the gross-up structure for liquidity reasons; others prefer the cleaner math of a lower purchase price with commission shown separately. What does not change in either scenario is the broker's payout.

What are the risks brokers should know about?

Direct-buyer deals have genuine trade-offs worth naming plainly.

No auction process. When we underwrite a property, we give one LOI. We don't participate in competitive bid rounds among multiple direct buyers. If your seller wants to test the market, we can be one option, but we won't enter a process designed to extract a ceiling price through escalation. Our LOI reflects our underwriting, and that is the number.

Our purchase price is our recast. Our Wichita bids sometimes come in below a seller's stated expectation, especially for well-maintained properties in core submarkets where listed comps suggest higher value. We are honest about the gap rather than inflating a number and retrading later. The no-retrade commitment is one of the things brokers who work with us repeatedly find most useful: the number holds after the inspection.

Commission payment requires a close. If the deal does not close for any reason, the broker is not paid. Our earnest money goes hard at the agreed schedule, and we forfeit it if we walk without cause. But there is no separate broker protection beyond the closing event itself.

Our buy box is specific. We buy 5-to-50-unit multifamily in Wichita, across Kansas, and in Washington State. B/C class, post-1960s vintage is our lane. Single-family, commercial mixed-use, and new construction don't fit. If a broker brings something outside that box, I will say so within 48 hours rather than string anyone along, but the deal will not pencil for us.

Is a direct-buyer relationship worth building for repeat deal flow?

The practical case for a broker to build an ongoing relationship with Kallpa comes down to two things: speed and certainty.

We can go from a broker's first call to a signed LOI in 48 hours. Title-to-close on a clean Wichita deal typically runs 14 to 21 days. For sellers with a hard timeline (a 1031 exchange deadline, an estate matter, a tenant situation that is creating liability), that speed has real value that a listed process cannot match, and the broker who can deliver that path earns the seller's gratitude and the next referral.

The certainty side is equally important. Our no-retrade policy exists because I have watched retrades damage trust between brokers and their clients, and I have watched buyers who retrade lose access to deal flow from the brokers who remember. We would rather pass on a deal than get a reputation for moving the number after the inspection.

The other practical reality: you're dealing with me. When a broker calls about a Wichita deal, I'm the one who underwrites the property and signs the LOI. No acquisitions analyst who needs committee approval. No deal team that convenes every other week. The answer I give on a Tuesday morning is the answer that goes into the PSA.

Brokers who have sent us multiple deals find that the relationship becomes more efficient over time. Once I understand a broker's typical deal profile, the underwriting conversation gets shorter, the LOI timeline gets tighter, and the process feels less like a formal transaction and more like two operators who know what each other needs.

For more detail on how we evaluate a deal once a broker submits it, the off-market overview covers how we price Kansas multifamily from first call through LOI. For brokers ready to bring a specific deal, our broker submission page is the fastest place to start. And for context on the Wichita market specifically, the Wichita sell page covers what sellers in our primary market need to know before deciding on a path.