1. What is Real Estate Commission?

Real estate commission is the fee paid to real estate agents and brokers for their services in facilitating the sale or purchase of a property. In Ontario, this is typically a percentage of the final sale price.

2. How Commission is Calculated

The standard commission calculation formula is:

Where:

• Sale Price — Final selling price of the property in Canadian dollars
• Commission Rate — Agreed percentage rate (typically between 3.5% to 5% in Ontario)

Note: The total commission is often split between the buyer's and seller's agents, and may include HST in Ontario.

3. Typical Commission Rates in Ontario

Details: In Ontario, total commission rates typically range from 3.5% to 5% of the sale price, though these are negotiable. The rate may vary based on:

• Property type and value
• Local market conditions
• Services included
• Competition among agents

4. Using the Calculator

Instructions: Enter the sale price of the property in CAD and the agreed commission rate (percentage). The calculator will compute the total commission amount.

5. Frequently Asked Questions (FAQ)

Q1: Is commission negotiable in Ontario?
A: Yes, commission rates are not fixed by law and can be negotiated between the seller and their agent.

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 brokerages.

Q3: Does the commission include HST?
A: No, HST (13% in Ontario) is added to the commission amount and paid separately.

Q4: Are there alternatives to percentage-based commission?
A: Some agents offer flat-fee services or tiered commission structures, especially for higher-value properties.

Q5: What services are included in the commission?
A: Typically includes marketing, showings, negotiations, paperwork, and guidance through the closing process.