How Much Commission Do Realtors Charge in British Columbia?

Most sellers want one number: what percentage will the realtor charge? The honest answer is that it is set by the agreement you sign, not by a government schedule, and you are entitled to see it in writing before the brokerage represents you.

This article explains who pays whom, what has to be in writing, what extra charges to watch for, and what to check before you sign. It does not give typical percentages, because the amount is a matter of agreement and can vary from one deal to the next.

This article covers the law of British Columbia.

Who sets the commission

A trading services agreement must state the expiry date, the remuneration payable and the circumstances in which it is payable. The remuneration is therefore set out in writing, so you can read it and ask about it before you sign. There is a limit: a licensee must not request or agree to remuneration based on the difference between the listed price and the actual sale price.

Real estate licensees in BC are regulated by BCFSA under the Real Estate Services Act. Anyone who provides real estate services to or on behalf of another for remuneration must be licensed or exempt. Ask how the commission is calculated, whether it applies to the sale price or something else, and what happens if the property sells in unusual circumstances.

Who pays whom

A managing broker, associate broker or representative must not accept remuneration for real estate services from anyone other than their own brokerage. So the commission is paid to the brokerage, and the brokerage pays its licensees.

Money received from or for a principal in relation to real estate services must be paid promptly into a BC interest-bearing trust account. Remuneration may be withdrawn from trust only once it is earned as determined under the Rules, and shares payable to another brokerage are paid directly from trust. Trust money intended as remuneration is considered earned at set points, for example the date transfer documents are submitted to the land title office for registration.

On top of the commission, the federal GST of 5% applies. In BC it is GST, not HST, that applies to a brokerage's commission, so a 5% amount is added on top.

What must be in writing

A brokerage providing trading services must have a written service agreement signed by the client and an authorized brokerage signatory. It must be entered into before the brokerage represents the client in offering the property for sale. The requirement does not apply if the prospective client waives it. Think carefully before waiving it.

• The expiry date of the agreement.
• The remuneration payable and the circumstances in which it is payable.
• Any amendments, which must be in writing and signed by the client and an authorized signatory.
• A copy delivered to you immediately on execution.

The Rules require a stated termination clause only for rental property management and strata management agreements. No general statutory right to cancel a listing agreement appears there, so the contract's own terms govern early termination. Read any cancellation, holdover or protection clause closely and have a lawyer review it if you are unsure.

Disclosure and what is not allowed

A licensee must promptly disclose to the client all remuneration paid or payable to the licensee's related brokerage, including its source and amount. When presenting an offer to a seller, the licensee must disclose the seller's payments to the listing brokerage, payments to any cooperating brokerage, amounts retained and other licensee remuneration.

A licensee must not request or agree to remuneration based on the difference between the listed price and the actual sale price, and cannot keep remuneration calculated that way.

A brokerage must not engage in dual agency, meaning acting for both sides, with limited exceptions such as certain remote locations, where written agreements are required. Separately, a managing broker, associate broker or representative must not accept remuneration for real estate services from anyone other than their own brokerage, so commission is paid to the brokerage, which pays its licensees.

What to do next

• Ask for the proposed agreement in writing before deciding.
• Check the expiry date, the commission amount and the circumstances in which it is payable.
• Ask how GST applies, since 5% is added to the commission.
• Ask for a full breakdown of what goes to the listing brokerage and any cooperating brokerage.
• Keep your signed copy and any signed amendments.
• Have a lawyer review the cancellation and holdover terms if anything is unclear.

Frequently asked questions