Realtors Commission in Canada
How much is the realtor commissions in Canada?
A lot of questions has been asked about how much commission, or a fee, realtors charge in Vancouver compares to elsewhere in Canada. As per Canadian Competition Act, realtors commission aren’t set in stones which means they are negotiable. How much fees to charge are up to the each real estate agent business practices. Most realtors in Metro Vancouver charge the lowest realtors fees in Canada, 7% on the first $100,000 and 2.5% on balance. The average total fees on a $1 million dollars property is 2.95% in Vancouver. The same property in Toronto, you’ll pay 5%. Half this goes to the buyer’s agent for bringing a qualified buyer. Also, don’t forget, it’s commission fee plus GST. GST is collected on behalf of Canada Revenue Agency on commissions paid, as of today, this is 5%.
Most home buyers don’t pay any fees to agents as the seller’s agent is splitting the fees with them. Same goes for mortgage brokers; they get paid by the lender for helping a client with a suitable mortgage.
Canadian real estate commission fee in percentage (on a $1 million):
Breakdown of all the real estate commission by Provinces
What do you get for the realtor fee you pay?
When you are selling your home, ask the realtor what he will be doing to market your home. What you’re looking for is a list of things he will be doing to market your home for the amount of remuneration he’s getting and have the agent be accountable to what’s on the list. There are a lot of expenses a selling agent has to cover before going live on MLS. These are expenses that are mandatory to sell your home fast for more money.
What happens if an offer comes from the selling agent?
In a dual agency relationship, where the listing agent represents the buyer and seller. Your agent, first and foremost, must disclose to you this new information. Some realtors may give back the sum of the funds meant for buyer’s agent, or a certain amount. It would be wise to talk to your agent when signing your MLS listing agreement and set this expectation.
Two important steps to take before you start looking for a home in Vancouver.
The qualified buyer often has the edge when it comes to getting the offer accepted. It’s in yours, and realtor’s, best interest to know how much you’re qualified. Have a Mortgage Professional go over your financial statement and assess your affordability. Knowing how much you qualify helps the REALTOR to narrow the search and find the home you are looking fast. By the way, whatever you discuss with your REALTOR, i.e., budget, your motive, and anything else, remains confidential. Since you submitted all the documents to your mortgage professional ahead of time, your mortgage professional can get started on working on your file of finding you a suitable lender while you’re searching for your new home. This is service cost you nothing. If someone demands you money to get you a mortgage, you must report this activity to BC Real Estate Council. Also, know the difference between a Bank Mortgage Specialist vs. Mortgage broker; not many know this.
Here’s a good comparison on that, Mortgage Professionals.
Second, reach out to a REALTOR to help you find a property. The best way to find a REALTOR is through a referral from friends and family. Or you can visit an open house and see if the REALTOR there is a good fit for you and finally do a search on realtor.ca. Ask him a lot of questions about his experience, any additional credentials he/she holds, and watch how he interacts with other open house guests. REALTORS often get paid by the seller so utilise them, it’s FREE. When I’m doing a buyer’s tour which consists of 3-8 properties, unless the client says no, I often include a meal and drink stops. These are all paid out of my pocket. It’s a small thing I can do to make my clients comfortable while searching for their ideal home.