Real estate commissions are the fees you pay to your real estate agent for their services. In B.C., buyer and seller real estate agents charge a graduated commission based on the transaction value that usually ranges between 3% to 4% for the first $100,000 of a property's price and between 1% to 2% for the remaining total.
Commission scales in B.C. vary from region to region. For example, seller or listing agents in the Greater Vancouver Area usually charge 3.875% on the first $100,000 of a transaction's value while seller agents in the Greater Victoria Region usually charge 3%. However, there is no standard commission rate and agents may offer different commissions. In almost all cases, the home seller pays the commissions of both the seller and buyer real estate agents.
Buyers usually do not pay any commission directly to their agents. The buyer’s agent commission is paid by the seller after the real estate transaction closes. Buyer agents in B.C. usually set their commission using a graduated scale based on the final sale or transaction price of a property. While most agents stick to commonly used commission rates in their region, commissions will vary between different cities in British Columbia and are up to the individual buyer agent to determine.
In most real estate markets in North America, buyer agents charge a commission equal to or greater than seller agents. This is also true in some regions of B.C. including Kelowna. In the Greater Vancouver Area, however, buyer agents usually charge less than seller agents with a 45% and 55% split of the total commission.
Seller agents in British Columbia usually set their commission using a graduated scale based on the final sale or transaction price of a property. There is no standard commission and the typical commission for the seller agents varies between different cities in British Columbia.
In the Greater Vancouver Area and Fraser Valley, most seller agent commissions are higher than those for buyer’s agents. In the rest of B.C., they are usually roughly equal. Many seller agents are willing to lower their commission rates for listing highly-valued or expensive properties. Some listing agents are even willing to charge a commission of only 1% of the property’s value, but their services may be slightly less than other real estate agents.
Whenever you check or negotiate real estate agent commissions, you should confirm the range of services that the agent will provide. If you are looking to save money during the selling process and get outstanding service at the same time, you can use WOWA to find agents with lower real estate commission.Find agents with low commission.
Buyer’s agent commission in Greater Vancouver Area: 3.125% on the first $100,000 of the home price and 1.1625% on the remaining total.
Seller’s agent commissions in Greater Vancouver Area: 3.875% on the first $100,000 and 1.3375% on the remaining total.
Buyer’s agent commission in Fraser Valley Area: 3.22% on the first $100,000 of the home price and 1.15% on the remaining total.
Seller’s agent commission in Fraser Valley Area: 3.78% on the first $100,000 and 1.35% on the remaining total.
Municipalities in the Fraser Valley include: Abbotsford, Chilliwack, District of Mission, District of Hope, District of Kent, Village of Harrison Hot Springs
Buyer’s agent commission in Victoria Area: 3% on the first $100,000 of the home price and 1.5% on the remaining total.
Seller’s agent commission in Victoria Area: 3% on the first $100,000 and 1.5% on the remaining total.
Buyer’s agent commission in Kelowna: 3.5% on the first $100,000 of the home price and 1.75% on the remaining total.
Seller’s agent commission in Kelowna: 3.5% on the first $100,000 and 1.75% on the remaining total.
No. Compared to commissions in other regions, real estate commissions in B.C. are considered to be low. This is especially true for higher value properties because the graduated commission system in B.C. has a low marginal commission rate for the balance of a property's value over $100,000.
For example, in the Greater Vancouver Area, the typical total commission for a $500K property is $17,850 after tax. In comparison, the total commission for a similar property in Ontario would be $28,250 after tax.
The difference becomes more noticeable for properties above $1M. In the Greater Vancouver Area, a hypothetical $1,500,000 property would typically have a total commission of $44,100 after tax. In Ontario, the total commission for a similar property would be $84,750 after tax, or almost double the commission of the property in Vancouver.
Commissions are estimates based on typical commission rates only and do not represent a standard or set rate for these regions.
The property seller will usually pay the real estate agent commissions of both the buyer and seller agents. When a home is listed, the seller will decide on the total commission they are willing to pay and how it will be split between the buyer and seller agents. This commission will then be paid out by lawyers after the transaction has been completed.
Typically, the seller will cover both the commission for both agents. In rare cases, if the seller lists the property by themselves or chooses not to give a buyer agent commission, the buyer may have to pay their agent the difference. However, such cases are rare and real estate agents will generally let you know beforehand if it is the case.
Real estate agents generally do not charge home buyers any commission for pre-construction or presale homes. Instead, their commission is paid by the builder or developer of the property.
Real estate agent commissions are high because the commission is split between many different parties and the real estate agent has to cover any marketing expenses even if the home doesn’t sell. The listing agent may have to pay upfront for professional photography, mail marketing materials, supplies, and much more. Your agent works very hard behind the scenes to ensure that you are getting the best price for your property
There is no formal rule or regulation that sets the commission rate. Canada’s Competition Act explicitly forbids real estate agents and the real estate industry from setting or claiming a standard commission rate. Each agent can choose their own commission type and rate or fee. Although the commission will vary from agent to agent, it will usually be close to the average commission for the area. Sellers can always negotiate the commission rate for their seller agent as well as set the commission for the buyer agent. Details about your agent’s commission will be outlined in the contract you sign when hiring an agent.
Yes, you can negotiate the commission with your agent. The commission makes up the largest portion of your selling costs, so it always makes sense to check and negotiate the commission of different real estate agents when selling a property.
Flat-fee commissions can seem like a great way to save money, especially since they are usually cheaper than typical percentage-based commissions. However, the quality and quantity of services offered with flat-fee packages are often lower. You may have to stage the home yourself and you will still have to pay a buyer’s agent commission. If you are looking to save on commission, it may be better to find real estate agents who charge a lower commission rate like 1%.
A cashback rebate real estate agent, also known as cashback agent, are buyer agents that provide cash incentives to homebuyers who work with them. These cash incentives can range from a few hundred to thousands of dollars depending on the agent and transaction value. While this is more common in the Toronto area, some agents in the Vancouver area are also willing to pay cash back to their clients.
Yes. Real estate agent commission is paid only when the property is sold, even if the property has been listed for a long time. In addition, some sellers may choose to self-list their properties and not offer a commission to buyer agents. We do not recommend this as doing so could reduce the likelihood of your property being sold.
A double-ended deal is when one agent represents both the seller and the buyer. In this case, the agent will get the total commission. Unlike Ontario, this is banned in BC because of the possible conflict of interest. RECBC believes that a real estate professional can’t be truly loyal to two clients with competing interests.
Yes, you can represent yourself without being represented by a licensed real estate professional. If you are a seller, this is referred to self-listing a property. While this can save on your real estate commission, you should consider the risks and disadvantages that come with conducting a real estate transaction by yourself.
British Columbia has the second highest number of real estate agents in Canada with 23,000 real estate agents and 11 real estate boards. Ontario is first with 79,000 and 38 real estate boards.
There are many additional closing costs involved in selling a home including lawyer fees, penalties from closing out a mortgage too early, as well as legal fees.