There are three sources of house advantage in pai gow poker.  You can assume two of them for yourself and use them to overcome the third - negating the house advantage and getting an edge on the game.  This section provides an overview of what the house does to make pai gow poker profitable for them.

Copies

In pai gow poker a copy is when the banker and the player have made a hand with the same poker rank.  This will nearly always occur in the two-card hand, but you will sometimes see a copy in the five-card hand (typically when both player and banker have made a straight).

In the event of a copy, the banker's hand wins.  

The frequency of copies will vary somewhat based on the method that the player and the banker are using to eset their hands, and the skill that they have in sticking to that method.  The range is from roughly 2.4% to 2.7%.  If the banker is using a standard Las Vegas or Atlantic City house way to set its hand and the player is skillfully using the method we have published here to set his hand, then the probability of a copy is very close to 2.5%.  

Given that the banker wins the copy and has a 50% chance of winning the second poker hand when there has been a copy, the advantage to the banker for winning copies is 1.25%.

Rake

The house charges a 5% rake on player wins, and also 5% on the banker's net win when a player is banking a hand.  This may seem like a lot, but it is really not too bad when you consider that more than two-thirds of hands result in a push or a loss for the player, and no rake is collected on those hands.  This makes the effective house advantage due to rake about 1.57%.   Much more palatable.

Skillful Play

Casinos have developed standard hand setting methods for their dealers to follow, and these are referred to as the house way.  The hand setting method we teach on this site provides an advantage over every house way we have tested it against.  The amount of the edge varies from one house way to another, but it averages out to about a 0.3% advantage if both you are accurately following our hand-setting guidance and the house dealer is accurately following the house way.

If you're playing as a banker against a player who is also following our hand setting methodology, you'll have no advantage.  Fortunately, this is rarely the case.  Your typical pai gow poker players will frequently make mistakes setting hands more complex than one pair.  The more mistakes they make the better, of course, but you can usually count on getting a 0.5% to 0.6% edge against a typical pai gow poker player if you are accurately following our guidance.  This edge is also cumulative - the more players at your table making mistakes, the bigger your advantage will become.

Bottom Line

The bottom line to all of this is that of the advantages that the house possesses in pai gow poker the only one you cannot turn to your own advantage is rake.   You can never get away from paying the rake.  You can get the advantage that winning copies provides by being the banker as often as possible.  You can also become sufficiently skillful at hand setting to get and edge on both the casino and the other players at your table.  The combination of skillful play and winning copies is enough to overcome the rake and give you an advantage at pai gow poker.

Good Luck!