How Much Does Real Estate Commission Cost?<\/h2>\n\n\n\n![\"where-does-real-estate-commission-go\"](\"https:\/\/www.zolo.ca\/blog\/wp-content\/uploads\/2019\/06\/bigstock-Woman-Handing-Out-Money-53849653-1024x791.jpg\")
<\/figure>\n\n\n\nReal estate commissions are variable, depending on where you live and what you negotiate with your agent. On average, real estate commissions in Canada<\/a> range from 5% to 7% \u2014 and this total commission split between both the seller\u2019s agent and the buyer\u2019s agent (as well as the brokerages that each agent represents).<\/p>\n\n\n\nIn the traditional sales transaction, you essentially payout two separate commissions, one to the listing agent, and one to the buyer\u2019s agent. In Canada, the cost of the buyer\u2019s agent commission is publicly available in the listing Realtor\u2019s listing document (the listing sheet that is made available to Realtors, but not to the general public). Usually, this listed commission rate is between 2.5% to 3%, except in B.C. where the first $100,000 of the sale offers a 3% (or more) commission, while the remaining portion of the sale price pays out 1% to 1.5% in commission. For the seller\u2019s agent, the commission paid is typically kept private and is negotiated between the seller and their agent. As a rule, though, the seller\u2019s agent will want to earn at least as much as the buyer\u2019s agent, since they\u2019ll be doing more work.<\/p>\n\n\n\n
So how do you save on real estate commissions and Realtor fees? Most of the methods below eliminate one or both of these. But keep in mind that if you\u2019re not offering a buyer\u2019s agent commission, many agents will be less likely to bring their clients to your home.<\/p>\n\n\n\n
Flat Fee MLS<\/h3>\n\n\n\n
A flat fee MLS service will get your home listed on the Multiple Listing Service<\/a>, or MLS, without offering any of the other services usually performed by listing agents. That means you\u2019ll have to do the staging, photography, open houses, paperwork, escrow management, and closing yourself. If that sounds daunting, it should; many sellers hire an attorney to handle a portion of these tasks; keep in mind that the attorney fees will offset some of the savings you earned by not paying Realtor commission.<\/p>\n\n\n\nIn America, a flat-fee MLS service gets your home listed on MLS, which means it\u2019s automatically populated onto all the big real estate sites like Zillow and Realtor.com. In America, a flat fee MLS listings<\/a> generally cost in the neighbourhood of $299 to $399 USD. In Canada, discount brokerages will offer full access to the MLS (minus agent services) for as little as $225 CDN.<\/p>\n\n\n\nJust keep in mind that if a buyer\u2019s agent brings you a buyer, you\u2019ll have to pay them a commission, so unless you\u2019re able to rustle up an unaffiliated buyer through your own networks, you\u2019re really only saving the listing agent commission, minus the MLS flat fee and, if you opt to use one, the attorney fees.<\/p>\n\n\n\n
For-Sale-By-Owner (FSBO)<\/h3>\n\n\n\n
FSBO stands for \u201cfor sale by owner,\u201d which says it all. You\u2019ll be selling your home all by yourself<\/a>, which means you\u2019re doing the marketing, the yard signs, the staging, the negotiations, and even baking the chocolate chip cookies for the open houses. It\u2019s a lot for one person to handle, which is why, statistically, few people do it.<\/p>\n\n\n\nWhile stats for the Canadian market are somewhat spotty (it\u2019s estimated less than 10% of homeowners go the FSBO route), the U.S.-based National Association of Realtors (NAR) has gathered data on FSBO sellers, and their conclusions are pretty stark. Only about 8% of sellers go the FSBO route, and of them, 36% eventually give up and hire an agent. It\u2019s also not great for the sale price; while a typical agent-assisted sale went for $265,000, the average FSBO listing sold for only $200,000.<\/p>\n\n\n\n
When you do the math \u2014 selling with an agent for $265,000 and paying a 6% commission of just under $16,000, you\u2019d still net $249,000 \u2014 even with the commission paid out, homeowners selling with agents still earn more on the sale of their home.<\/p>\n\n\n\n
What\u2019s worse, is the FSBO that still requires you to pay the buyer\u2019s agent commission<\/a>. Let\u2019s assume you sell your property for $200,000 but in order to finalize the sale, you agreed to pay the buyer agent\u2019s commission. This means you\u2019d need to subtract as much as 3% off the sale price, to pay a commission of $6,000, meaning you\u2019ll get $194,000.<\/p>\n\n\n\nGiven the statistics, selling your home through FSBO probably won\u2019t maximize your profits.<\/p>\n\n\n\n
Discount Realtors<\/h3>\n\n\n\n
Discount realtors like One Percent Realty in Canada offer a traditional, full-service agent experience at a lower price point. If that sounds fishy to you, it shouldn\u2019t. They simply use a slightly different business model that incentivizes their agents to work for lower fees and help home buyers or sellers save money.<\/p>\n\n\n\n
Some discount brokerages, like the U.S.-based giant Redfin, employ agents as salaried employees rather than commission-based affiliates and are able to pass those savings onto their customers. Other discount brokerages (or networks, such as Zillow) work as referral services, passing high-quality, pre-vetted leads onto agents in their network. These agents are willing to take on these leads for a flat fee because they generally take less time and effort to close, so what they\u2019re losing in money per sale, they\u2019re making up for in volume.<\/p>\n\n\n\n
Full-Service Realtors<\/h3>\n\n\n\n
Contrary to popular belief, you can use a full service, conventional realtor<\/a> and still save on real estate commissions. The reality is that nearly every aspect of a real estate transaction, from commission to closing, is up for negotiation.<\/p>\n\n\n\nNegotiating with Full-Service Realtors<\/h2>\n\n\n\n![\"Couple](\"https:\/\/www.zolo.ca\/blog\/wp-content\/uploads\/2018\/11\/Happy-and-smiling-african-american-man-shaking-hands-with-real-estate-agent-and-his-wife-sitting-next-to-him-1024x683.jpg\")
<\/figure>\n\n\n\nOf course, real estate agents<\/a> are professional negotiators, so it isn\u2019t always easy to get a discount out of them. But sometimes you can get one just by asking, especially if your home is a desirable property<\/a> that will sell fast. Knocking a point or two off the commission isn\u2019t a big deal if they know they can get you an offer after your first open house.<\/p>\n\n\n\nAnother way to get a discounted commission is if you have multiple properties. Mentioning that you could bring multiple listings to your agent can definitely get you a bulk discount. Agents know that there\u2019s nothing more valuable than repeat business, and they don\u2019t mind sweetening the deal to win your loyalty and help you save on real estate commissions.<\/p>\n","protected":false},"excerpt":{"rendered":"
Saving money during the sale of a home is a top priority for most homeowners. Here’s a look at the various ways to save on real estate commissions, including FSBO, discount brokers as well as negotiating with full-service agents<\/p>\n","protected":false},"author":55,"featured_media":16532,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[48],"tags":[],"guide":[],"class_list":["post-12362","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-selling"],"acf":[],"zolo_excerpt":"","_links":{"self":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts\/12362","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/users\/55"}],"replies":[{"embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/comments?post=12362"}],"version-history":[{"count":8,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts\/12362\/revisions"}],"predecessor-version":[{"id":21811,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts\/12362\/revisions\/21811"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/media\/16532"}],"wp:attachment":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/media?parent=12362"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/categories?post=12362"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/tags?post=12362"},{"taxonomy":"guide","embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/guide?post=12362"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
<\/figure>\n\n\n\nReal estate commissions are variable, depending on where you live and what you negotiate with your agent. On average, real estate commissions in Canada<\/a> range from 5% to 7% \u2014 and this total commission split between both the seller\u2019s agent and the buyer\u2019s agent (as well as the brokerages that each agent represents).<\/p>\n\n\n\n In the traditional sales transaction, you essentially payout two separate commissions, one to the listing agent, and one to the buyer\u2019s agent. In Canada, the cost of the buyer\u2019s agent commission is publicly available in the listing Realtor\u2019s listing document (the listing sheet that is made available to Realtors, but not to the general public). Usually, this listed commission rate is between 2.5% to 3%, except in B.C. where the first $100,000 of the sale offers a 3% (or more) commission, while the remaining portion of the sale price pays out 1% to 1.5% in commission. For the seller\u2019s agent, the commission paid is typically kept private and is negotiated between the seller and their agent. As a rule, though, the seller\u2019s agent will want to earn at least as much as the buyer\u2019s agent, since they\u2019ll be doing more work.<\/p>\n\n\n\n So how do you save on real estate commissions and Realtor fees? Most of the methods below eliminate one or both of these. But keep in mind that if you\u2019re not offering a buyer\u2019s agent commission, many agents will be less likely to bring their clients to your home.<\/p>\n\n\n\n A flat fee MLS service will get your home listed on the Multiple Listing Service<\/a>, or MLS, without offering any of the other services usually performed by listing agents. That means you\u2019ll have to do the staging, photography, open houses, paperwork, escrow management, and closing yourself. If that sounds daunting, it should; many sellers hire an attorney to handle a portion of these tasks; keep in mind that the attorney fees will offset some of the savings you earned by not paying Realtor commission.<\/p>\n\n\n\n In America, a flat-fee MLS service gets your home listed on MLS, which means it\u2019s automatically populated onto all the big real estate sites like Zillow and Realtor.com. In America, a flat fee MLS listings<\/a> generally cost in the neighbourhood of $299 to $399 USD. In Canada, discount brokerages will offer full access to the MLS (minus agent services) for as little as $225 CDN.<\/p>\n\n\n\n Just keep in mind that if a buyer\u2019s agent brings you a buyer, you\u2019ll have to pay them a commission, so unless you\u2019re able to rustle up an unaffiliated buyer through your own networks, you\u2019re really only saving the listing agent commission, minus the MLS flat fee and, if you opt to use one, the attorney fees.<\/p>\n\n\n\n FSBO stands for \u201cfor sale by owner,\u201d which says it all. You\u2019ll be selling your home all by yourself<\/a>, which means you\u2019re doing the marketing, the yard signs, the staging, the negotiations, and even baking the chocolate chip cookies for the open houses. It\u2019s a lot for one person to handle, which is why, statistically, few people do it.<\/p>\n\n\n\n While stats for the Canadian market are somewhat spotty (it\u2019s estimated less than 10% of homeowners go the FSBO route), the U.S.-based National Association of Realtors (NAR) has gathered data on FSBO sellers, and their conclusions are pretty stark. Only about 8% of sellers go the FSBO route, and of them, 36% eventually give up and hire an agent. It\u2019s also not great for the sale price; while a typical agent-assisted sale went for $265,000, the average FSBO listing sold for only $200,000.<\/p>\n\n\n\n When you do the math \u2014 selling with an agent for $265,000 and paying a 6% commission of just under $16,000, you\u2019d still net $249,000 \u2014 even with the commission paid out, homeowners selling with agents still earn more on the sale of their home.<\/p>\n\n\n\n What\u2019s worse, is the FSBO that still requires you to pay the buyer\u2019s agent commission<\/a>. Let\u2019s assume you sell your property for $200,000 but in order to finalize the sale, you agreed to pay the buyer agent\u2019s commission. This means you\u2019d need to subtract as much as 3% off the sale price, to pay a commission of $6,000, meaning you\u2019ll get $194,000.<\/p>\n\n\n\n Given the statistics, selling your home through FSBO probably won\u2019t maximize your profits.<\/p>\n\n\n\n Discount realtors like One Percent Realty in Canada offer a traditional, full-service agent experience at a lower price point. If that sounds fishy to you, it shouldn\u2019t. They simply use a slightly different business model that incentivizes their agents to work for lower fees and help home buyers or sellers save money.<\/p>\n\n\n\n Some discount brokerages, like the U.S.-based giant Redfin, employ agents as salaried employees rather than commission-based affiliates and are able to pass those savings onto their customers. Other discount brokerages (or networks, such as Zillow) work as referral services, passing high-quality, pre-vetted leads onto agents in their network. These agents are willing to take on these leads for a flat fee because they generally take less time and effort to close, so what they\u2019re losing in money per sale, they\u2019re making up for in volume.<\/p>\n\n\n\n Contrary to popular belief, you can use a full service, conventional realtor<\/a> and still save on real estate commissions. The reality is that nearly every aspect of a real estate transaction, from commission to closing, is up for negotiation.<\/p>\n\n\n\n Of course, real estate agents<\/a> are professional negotiators, so it isn\u2019t always easy to get a discount out of them. But sometimes you can get one just by asking, especially if your home is a desirable property<\/a> that will sell fast. Knocking a point or two off the commission isn\u2019t a big deal if they know they can get you an offer after your first open house.<\/p>\n\n\n\n Another way to get a discounted commission is if you have multiple properties. Mentioning that you could bring multiple listings to your agent can definitely get you a bulk discount. Agents know that there\u2019s nothing more valuable than repeat business, and they don\u2019t mind sweetening the deal to win your loyalty and help you save on real estate commissions.<\/p>\n","protected":false},"excerpt":{"rendered":" Saving money during the sale of a home is a top priority for most homeowners. Here’s a look at the various ways to save on real estate commissions, including FSBO, discount brokers as well as negotiating with full-service agents<\/p>\n","protected":false},"author":55,"featured_media":16532,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[48],"tags":[],"guide":[],"class_list":["post-12362","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-selling"],"acf":[],"zolo_excerpt":"","_links":{"self":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts\/12362","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/users\/55"}],"replies":[{"embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/comments?post=12362"}],"version-history":[{"count":8,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts\/12362\/revisions"}],"predecessor-version":[{"id":21811,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/posts\/12362\/revisions\/21811"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/media\/16532"}],"wp:attachment":[{"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/media?parent=12362"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/categories?post=12362"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/tags?post=12362"},{"taxonomy":"guide","embeddable":true,"href":"https:\/\/www.zolo.ca\/blog\/wp-json\/wp\/v2\/guide?post=12362"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Flat Fee MLS<\/h3>\n\n\n\n
For-Sale-By-Owner (FSBO)<\/h3>\n\n\n\n
Discount Realtors<\/h3>\n\n\n\n
Full-Service Realtors<\/h3>\n\n\n\n
Negotiating with Full-Service Realtors<\/h2>\n\n\n\n
<\/figure>\n\n\n\n