Examining the house edge in blackjack
It has to be remembered that every casino, both on and offline, are businesses and this means that they need to make money. On average, every casino game that you can think of will lead to the house making money so that the business can prosper. While blackjack is loved as a game with a low house edge, the edge still exists even though some players don’t always see this.
The house has one big edge that applies no matter the variant you’re playing. That is, as a player, you can first. Go bust and the game is over: no matter what the dealer’s hand is, the house wins. Going bust brings your hand to an end. Of course, the game will continue for others at the table and the dealer’s hand will be relevant to them, but for you, the action is over.
In this article, we’re going to take a closer look at the house edge in blackjack. We’re going to consider what it is as well as how it works.
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House edge in blackjack – Examining dealer actions
If you’re a fan of blackjack, you’re probably already aware of the fact that dealers have no choice other than to hit if their hand is worth 16 or less. Likewise, they’re also required to stand on a hand that’s worth 17 or more. Depending on the rules of the table that you’re playing at, it could also be that a dealer has to hit soft 17 and stand on hard 17.
Whether or not a dealer has to hit or stand on soft 17 has a slight impact on how often they will go bust. However, generally speaking, dealers will go bust approximately 28% of the time. Newbies think that dealers play in a certain way as it helps them to win and this leads to them copying. The result? The player will also go bust 28% of the time. There would be times when both dealer and player go bust at the same time and in these cases, the house would still win.
If you consider average results, where players stick to the same hit/stand rules of blackjack as the dealer, the house has a gigantic 8% edge. This is based on a single-deck game and would increase with each additional deck. Now, an 8% house edge is hardly attractive to players so what makes them start in the first place?
How things get interesting regarding the house edge in blackjack
You can no doubt imagine that an 8% house edge would see your bankroll being obliterated in record time. We’re pretty sure that this level of house edge is one that you wouldn’t entertain: you’d simply find other casino games to play.
Yes, casinos need to make money but they certainly don’t want to scare players away. That being the case, rules were tweaked so that some of that edge was given back to players. Four common ways that happen are:
- Players are free to decide what action to take – there are no rules saying that they must stand or hit on certain hands
- The majority of winning bets pay even money but, generally, a natural blackjack will pay more
- Players are given the opportunity to double down
- Players are allowed to split their pairs
How the house edge in blackjack moves
There are a whole host of other factors that can shift the house edge. However, the ones that we have looked at above are those that have the biggest impact. In fact, these four rules have the effect of bringing the house edge down from 8% to less than 15. If you’re playing a game with 6 decks, the edge goes down to around 0.5%. How do these rules have such a massive impact? Let’s take a look:
Hit and stand decisions
As we have seen, the dealer has to play to a set of rules that tell them when they must hit or stand. Players are given the freedom to decide for themselves. This rule on its own leads to the house edge falling by around 3.2%. This is how it works in practice:
- Imagine your hand is 9-7 and you have to hit hard 16
- The dealer has a 6-face-up card
- Dealer strategy would lead to you losing 43.7 cents for every dollar wagered
- Having the freedom to stand instead of hit reduces this loss to an average of 12.5 cents
Natural blackjack payouts
We’ve always been passionate about choosing your blackjack table wisely. You need to be looking for ones where the payout for a natural blackjack is 3:2. Why? Well, with this payout you kick another 2.3% from the house edge. There are many tables where players are now offered a 6:5 payout. In these cases, you’re losing out on around 1.4% as it only lowers the house edge by 0.9%.
Imagine that there were no other rule changes to consider other than the payout for a natural blackjack. This would mean with a 3:2 payout the edge would fall from 8% to 5.7%. With 6:5 this only falls to 7.1%.
Doubling down
This is something that dealers don’t have the option to do. You, however, have the opportunity to double your bet once you’ve seen your first two cards and then take one more card. This opportunity allows you to lower the house edge by a further 1.6%.
Of course, you won’t always win when you double down so there is the risk that you could lose double your initial bet. However, if you follow basic blackjack strategy, average results will be in your favor.
Splitting pairs
If you have two cards of equal value then you have the opportunity to split these and play them as separate hands. You need to place a second bet that’s equal to your first and you then go on and play two separate hands. This is something that the dealer is unable to do.
Being able to split sees another 0.4% coming off the house edge. When you consider all four points together, that nasty 8% has come all the way down to 0.2%.
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