1. What is Real Estate Commission?

Real estate commission is the fee paid to real estate agents for their services in facilitating a property sale. In British Columbia, commission rates are typically negotiated between the seller and their agent, but standard rates are often used as a starting point.

2. How Commission is Calculated in BC

The basic commission formula is:

In BC, a common tiered commission structure is:

• 7% on the first $100,000 of the sale price
• 3% on the remaining balance

Example: For a $500,000 property:

• First $100,000: $100,000 × 7% = $7,000
• Remaining $400,000: $400,000 × 3% = $12,000
• Total Commission: $7,000 + $12,000 = $19,000

3. Standard Commission Rates in BC

Details: While commissions are negotiable, the typical total commission in BC is 5-7% on the first $100,000 and 2-3% on the balance. This is usually split between the buyer's and seller's agents.

4. Using the Calculator

Tips: Enter the property sale price in Canadian dollars and the commission rate as a percentage. The calculator will show both your custom rate calculation and the BC standard tiered commission for comparison.

5. Frequently Asked Questions (FAQ)

Q1: Are real estate commissions fixed in BC?
A: No, commissions are negotiable between the seller and their agent. The rates shown are typical but not mandatory.

Q2: Who pays the commission in a real estate transaction?
A: Typically the seller pays the commission, which is then split between the listing and buying agents.

Q3: Is GST applied to real estate commissions?
A: Yes, GST (5%) is added to the commission amount in BC.

Q4: Can I negotiate a lower commission rate?
A: Yes, commission rates are always negotiable. Discount brokerages may offer lower rates with fewer services.

Q5: What's included in the commission?
A: Commission typically covers marketing, showings, negotiations, paperwork, and coordination of the sale process.