How to Sell Your Condo Episode 10 – Understanding Multiple Listing Contracts for Vancouver Property Sellers
https://youtu.be/Y4jstD8nZGM In Episode 9 of How to Sell Your Condo in Vancouver, we discussed marketing…
Updated by Mike Stewart PREC March 23, 2023
This page is to designed to create a clear understanding and calculation of real estate commissions in Vancouver and across British Columbia, Canada.
When it comes to real estate commission fees, I can only quote what I charge (which have not changed since I became a licensed BC Realtor in 2005).
I charge a seller in a real estate commission of 7% on the first $100,000 of the sale price and 2.5% on the balance of the sale price for properties in Vancouver, British Columbia and surrounding cities. (Please note – around 48% of this amount or 3.125% on the first $100,000 and 1.1625% on the balance goes to a buyers agent – please see below for more details).
Have a look at these great videos on How to Sell a Property in Vancouver.
Real estate commissions and how they are discussed by Realtors in Canada are regulated by the Federal Government.
The reason I mention the amount of real estate commissions I personally charge sellers and not a standard amount is because saying that there is a standard real estate commission is illegal in Canada.
"*" indicates required fields
According to Canada’s Competition Act, there we Realtors are not supposed to say there is a standard real estate commission. We are required to do this to ensure that a prospective seller knows that they can negotiate on commissions.
Merriam-Webster dictionary defines a commission as following:
A fee paid to an agent or employee for transacting a piece of business or performing a service
especially : a percentage of the money received from a total paid to the agent responsible for the business
In real estate in British Columbia, a commission is the amount a real estate agent gets paid to represent a buyer or a seller in a property sale and the amount is usually expressed in percentage terms. To look at it from a buyer or a sellers perspective, real estate commissions are the costs to sell real estate (even though buyers typically do not pay commission – more on that below)
In British Columbia, Realtor commission fees are typically a percentage of the sale price of the property.
Typically the commission fee is a percentage of the first $100,000 of purchase price and then a percentage of the balance of the sale price.
Other jurisdictions like California may use one single percentage to calculate Realtor commissions, for example a 6% commission on the sale price, but standard calculation across BC is to use a percentage of the first $100,000 and then percentage of the balance.
Yes, there is absolutely variation in how much Realtors charge in terms of commission. Again, Canada’s federal Competition Act specifically requires Realtors to stress there is no set commission rate to sell properties in Canada.
The variation in real estate commissions tends to vary by market and property type. Some Realtors in higher end markets may ask for and in many cases get a higher commission. Realtors may also negotiate a higher commission for prospective sales that may be more difficult or challenging.
There are some real estate firms who charge a flat fee or a single low percentage to sell a home, but this is small part of the market and more common in rural areas.
Real estate agents representing sellers offer a commission to buyers agents as part of the cooperation system of the Multiple Listing System (now referred to as Realtor.ca for the general public). This buyers agent commission is payable if said buyers agents clients purchase the property in question.
Again, there is not a standard amount that a sellers agent will offer a buyers agent to bring their buyers. What is offered to the buyers agent and how a Realtor discusses this topic is regulated in Canada. According to the Competition Act, I am only able to discuss what I charge sellers for commission and offer buyers agents. Realtors are not allowed to say there is a standard buyers agent commission.
I offer buyers agents when I represent a seller: I offer buyers agents around HALF (3.125% on the FIRST $100K of the sale price & 1.1625% on the balance of the sale price) of the 7% on the first $100,000 of the sale price and 2.5% on the balance of the sale price is payable to a buyers agent who brings the seller an offer that completes at the Land Titles Office.
This amount can found in the “Buyers Agent Commission” field of the commission calculator above once you click “Calculate”
I receive 3.875% on the first $100,000 of the purchase price and 1.3375% of the balance of the purchase price. This amount can found in the “Sellers Agent Commission” field of the commission calculator above once you click “Calculate”
Realtors only get paid when a property sells. If a property does not sell, Realtors do not get paid.
Real estate commissions in British Columbia are typically paid to the buyers agent and the sellers agent upon or within a few days after the Completion Date of property sale.
The Completion date is the day on which the seller gives the buyer ownership and the buyer gives the seller the money for the property and title of said property transfers at the land titles office.
Please note, the Completion Date is not the Possession Date. The Possession Date is the day a buyer can move in and is typically after the Completion Date.
The seller pays the realtor commission in BC with the vast majority of property transactions that occur. In some cases a seller may not want to pay commission and a buyer may have to pay their Realtor a commission, but this is a very rare occurrence and may be more common with transactions off of MLS.
Real Estate commissions and the net proceeds (for example the amount a Seller receives from a real estate sale after costs) are often confusing for prospective property Sellers in Vancouver.
Most Sellers aren’t sure about how much commission they will have to pay and how much tax (GST) will be payable on the real estate commission fee once the property sells.
This Vancouver home sale calculator specifically answers this question above and should give a prospective seller a clear picture of exactly how much they will receive after the sale of their property. The calculator also determines the amount of GST that will be payable on the amounts paid to the buyers and sellers agents.
We tried to make the calculator is easy to use as possible.
Step number 1 – Input the potential sale price of the property in question in the form above to the right of where is says “Purchase Price”
Check out this great video on Comparative Market Analysis or call me at 604-763-3136) in the form above.
Step Number 2 – Click “Calculate” to the bottom left.
Once you have clicked “Calculate” you should see the following amounts in Canadian dollars:
Basically, this commission calculator lets a seller how much they will end up with in their pocket when once the transaction their property completes after all costs of the sale.
Remember Folks! There is no standard or average real estate commission fee in Vancouver and across Canada and your Realtor fees are negotiable always!
Remember! Around 48% of the Commission calculated above goes to the Buyers Agent who brings an offer that gets accepted and Completes at the Land Titles Office!
If you are having any issues with this calculator, feel free to call me directly at 604-763-3136 for assistance.
Here’s an example of real estate commission fees in Vancouver and the GST payable on those commissions on this calculator for sale prices ranging from $500,000 to $10,000,000:
|Seller’s Agent Commission||Buyer’s Agent Commission||GST||Seller
Please note these calculations above are based on the following assumptions:
Is there a standard real estate commission fee in BC? No. There is no standard commission fee for real estate in British Columbia. Individual Realtors, set their own commission fees they charge.
Do buyers pay commission? Typically, buyers do not pay real estate fees in British Columbia.
When do real estate commissions get paid? Typically, real estate commission fees are paid upon the completion of a purchase
Who decides the amount of a BC real estate commission? Individual Real Estate Agents in British Columbia set their own commission rates.
Canada’s federal Goods and Services Tax is payable on real estate commission fees in British Columbia and across the country.
GST in Canada is 5% and is payable on the amount of Realtor commission fees paid by the seller. The GST on Realtor fees is not payable on the sale price of the property, only on the commission fees paid.
The good news is that in 99% of the time Buyers of Property in Vancouver DO NOT directly pay commission to their Buyers Agent. The calculator above has a break down of how much the buyers agent gets paid.
Check out this great video on the definition of a Primary Residence in Canada!
Please note – all sums above are in Canadian dollars.
This Post Has 10 Comments
Hello. On top of the realtor’s commission there is yet another commission not accounted for the in the online calculator. The BC Public Guardian and Trustee gets a commission ON TOP of the realtor’s commission, when a property in its hands through an estate it manages happens to be sold. It would be very interesting to add to the calculator the commission that also goes to the BC PGT, with separate GST for that item.
Good to hear from you!
Thanks for the feedback.
This commission calculator is for run of the mill transactions.
Feel free to shoot me an email with more information on the situation you’re dealing with.
I may not be calculating things correctly but your commission calculator doesn’t seem to align with the percentages in your description. Your calculator is showing $15,913 for your commission. Why?
If the first 100,000 is 7% = $7,000 and then 900,000 is 2.5% = 22,500…total = $29,500. Again, the calulator is showing me $15,913 which is also a really odd number given the really rounded numbers in your formula.
Can you tell me if I am calculating something incorrectly please?
Good to hear from you.
Thank you for the feedback!
Can you let me know the sale price you put in so I can try to see what the issue is?
Just saw your post… The calculator splits the commission between the agents representing the buyer and the seller. For a $1,000,000 sale, you should see 2 commissions listed: $15,913 to the seller’s agent and $13,588 to the buyer’s agent for a total of $23,501 (the extra $1 would be rounding error).
Hope that helps!
Thanks for the feedback Marc!
I will look into this.
Have a good weekend!
Question – what are the other deductions made from the pay out? I know someone who was in a 70-30 split but was charged extra for “1%”, “general expenses”, deal fee, donation . After everything, he got like 50% of the commission which is not a lot already since it is presale..
Good to hear from you.
I can’t comment on other Realtors commissions, but I charge what is in the calculator above.
What are your thoughts?
Hey Mike, great calculator. I’ve been using it for years. I freaked out a few months ago when it wouldn’t load for a few days. Do you have a tip jar of some sort I can donate to help you keep it going?
Hi Vy Tri – good to hear from you!
Thank you for the kind words!