Real estate transactions in Ontario are governed by the Real Estate and Business Brokers Act, 2002 (REBBA), which sets out the rules and regulations for real estate agents and brokers in the province. One of the most important aspects of REBBA is the commission structure for real estate transactions. This article will provide an overview of the different types of Ontario realtor commission structures and how they work.
The most common type of commission structure in Ontario is the “traditional” commission structure, which is a percentage of the sale price of the property. This commission is typically split between the listing agent and the buyer’s agent, and is usually between 5% and 7% of the sale price. The listing agent is typically responsible for marketing the property, negotiating the sale, and handling the paperwork associated with the transaction. The buyer’s agent is typically responsible for finding a suitable property, negotiating the sale, and handling the paperwork associated with the transaction.
In addition to the traditional commission structure, there are also “flat fee” commission structures available in Ontario. With a flat fee structure, the real estate agent charges a set fee for their services, regardless of the sale price of the property. This fee is typically lower than the traditional commission structure, and can be a great option for buyers and sellers who are looking to save money on their real estate transaction.
Finally, there are also “hybrid” commission structures available in Ontario. These structures combine elements of the traditional commission structure with elements of the flat fee structure. For example, a hybrid commission structure may include a set fee for the listing agent’s services, plus a percentage of the sale price for the buyer’s agent’s services.
Understanding the different types of Ontario realtor commission structures is important for buyers and sellers who are looking to maximize their savings on their real estate transaction. It is important to do your research and understand the different commission structures available in order to ensure that you are getting the best deal possible.