How Does the House Edge in Blackjack Work?

Razor and playing card

The house always wins. But when it comes to real money blackjack, the way the house edge works is quite a bit different than in other games.

Before I dive into the topic, let’s make sure we’re all on the same page on this one—there’s not a game in existence where the house doesn’t have an edge.

That funny phrase about how “the house always wins” isn’t just a clever casino spiel, it’s reality. Casinos could not exist if they didn’t have an edge. It just wouldn’t make sense from a business standpoint.

Every game you play in a casino has a house edge. And how large that edge is depends on the rules the casino puts in place to some extent, and on you to some extent—your strategy, your tactics, your knowledge of the game, your decisions on how you play and why you make the plays that you do. All of these things affect how large the house’s edge truly is.

So, how does that house edge work for blackjack, anyway? Let’s take a look.

Start Thinking in Percentages

If you don’t like math, you’re probably not going to like gambling much. Or, at the very least, you’re not going to be very good at it.

House edges are usually expressed in percentages. Blackjack is well-known as being one of the few games where the house edge is low enough that you can potentially profit.

Now, as mentioned before, there are many factors that determine the house’s edge, but you’re looking at anything between 0.5% (if you’re implementing a good blackjack strategy) and a few percent (or even more).

There’s a reason so many gambling movies focus on blackjack. It’s one of the games where you can potentially come out on top if you know what you’re doing.

Why? Because the house edge only really means something for a statistically significant number of hands. What that little percentage up there means is that, on average, all players who are playing blackjack are going to lose about 0.5% of what they bet over time.

It’s clear right away why this only means something across a large number of bets. If you bet $100 and lose a hand, there’s no possible way to lose 50 cents. You either win some money, you lose some money, or you end up neutral.

But if you add up all the bets of all the players who are currently on the floor of a casino, and you start to measure the amount won and the amount lost over time, you’ll see that the house is going to be up about 50 cents a hand on average.

Casinos are profitable for precisely this reason. The rules are set up so that, statistically and over time, house losses are negated by house wins, and a slight profit is made. Slots tend to have the worst odds (and thus, are most profitable for the house), but the house holds an edge in almost every game available to you. But there are rare exceptions.

What Determines the House Edge

There are a number of factors that specifically determine the house edge. First and foremost is strategy. If you don’t know what you’re doing and don’t have a clear strategy, the house edge is going to be closer to 2% than 0.5%.

Other rules that can often feel completely strange or incalculable to new players also affect the house edge. For example, the amount you can win if you play a natural (blackjack—21) plays a big role in the house edge.

You’ll find that some casinos will pay you 3:2 on a natural (which means, for example, that you get $15 on a $10 bet), but many other casinos have moved to paying 6:5 (you get $12 if you get blackjack on a $10 bet). That greatly increases the house edge, so avoid it if you can.

Cards and Monopoly houses

Other rules play a factor—does the dealer hit or stand on a soft 17? Can you double after a split? Can you double on any first two cards? How many hands can you re-split to? Can you re-split aces? Can you hit on re-split aces? What about when a dealer gets a blackjack—do you only lose your original bet? What’s the surrender rule?

All of these seemingly insignificant rules play a huge role in the house’s edge, but remember—the house is winning over time over many different hands.

You don’t have to play a lot of different hands, you can come out on top.

Beat the House – Walk Away When You’re Winning

If you decide that the house edge in the casino you’re playing in is, say, 1%, that means you’re losing about 1% of whatever you’re betting over time.

But what happens when you win on the first hand? Let’s say you hit blackjack on your very first hand—lucky, but certainly not impossible.

Let’s further say that you bet $100 on that firsthand and the casino pays 3:2 on a natural, so you’re now up $50.

What happens when you walk away? You walk away with $50.

See, the house edge only means something over thousands of hands—tens of thousands, hundreds of thousands—all the hands that you play and that everyone else plays.

But if you only play a few hands (even a few dozen), you’re not in the realm of statistics anymore, you’re in the realm of randomness and luck.

If you’re following a decent blackjack strategy and you’ve practiced a lot, with a little luck, you might find yourself up by many hundreds or thousands of dollars over a short period of time.

If you walk away from the table before you start to lose (and you will start to lose if you play enough hands), then you’ve just beaten the odds.

The same can be said for losing, however, if you find yourself down, cutting your losses may be the best way to go. It’s certainly possible you can win your money back and get on top again, but on average, you are literally paying money to play, in the form of that 1% of your bet that the house is claiming on average.

The Solid Base of the House Edge That You Can Never Overcome

While we can talk all day long about blackjack strategy and how much money you make on a natural and all that jazz, I think it’s instructive to look at the origin of the house edge in the first place.

Every game you play in a casino has some simple rule that automatically guarantees the house and edge of some sort. Games of pure luck keep that house edge rigid, for example, there’s not much you can do to influence the odds of a roulette wheel. You place your bet, you let that sucker spin, and you either win or you lose. That’s that.

Blackjack’s house edge may be much more flexible given how you can apply strategy, but the foundation of the edge comes from the simple fact that you can bust before the dealer even has a chance to play their hand.

Blackjack table

Think about it! If you bust, the dealer might have busted as well, but it still counts as a win for the dealer because you bust first. The dealer doesn’t have to reveal their hand until the end.

That translates into a huge advantage for the dealer. The house starts off with such an enormous advantage that all those other rules have to be put into effect just to get the darn thing down to something reasonable, and even then, you need a solid strategy if you’re going to beat the house.

What Is a Blackjack Strategy?

A blackjack strategy is essentially a set of rules that takes into account probabilities of cards turning up and then makes recommendations one what you should play based on your hand and the card the dealer has revealed.

While there are more than a few blackjack strategies out there, you’re going to need to do at least some studying if you want to understand how to reduce the house edge and get yourself to a place where you can at least have a chance of making some profit.

Remember, even with a strategy, the house still maintains that edge. There’s no way around it. So, on top of whatever strategy you come up with, it’s still a good idea to learn how to get out when the gettin’s good.

That means that sometimes, you’re going to have to eat a loss and come back another day (before your losses get too big).

Sometimes, you’re going to walk away when you feel like you’re on a winning streak. At the beginning, I say that you’re going to have a bad time if you don’t like math, and it’s true. Every hand you play is a complete tossup. There’s no such thing as having a hot or cold streak.

The only way you beat the house is to quit when you’re ahead.

Conclusion

The house edge works in blackjack in just about the same way it works in every other game, that is to say, it works for the house and against you. Learn some blackjack strategy, take free gambling lessons at some of the bigger casinos, learn what you can learn from watching the pros, but ultimately, if you want to beat the house edge, learn to walk away.