If you’re wondering how real estate agents seem to do so well for themselves it’s because all real estate agents are paid on commission. This means that a small percentage of the sale of a home is taken and given to a real estate agent as payment for their work.
Below we go more into detail about just how the real estate commission system in BC works and how real estate agents are paid.
How Does Real Estate Commission in BC Work?
As we mentioned above, buyers don’t pay real estate agents directly. Instead, their commission is based on the final sale of a piece of property. Commissions for both the buyer’s and seller’s agents are taken off the top of the proceeds of the sale. The higher the sale price, the higher the commission for any real estate agents involved. That’s why luxury homes are so lucrative for real estate agents.
What Is the Commission Rate for Real Estate Agents in BC?
There’s not a standard rate used for commission across the province, since it varies on the region and the agent, but across Canada, the average is between 3% to 7% of the final purchase price.
So, for example, on a $500,000 home a real estate agent with a 3% commission would make $15,000.
Is Using a Real Estate Agent Worth It?
That may seem like a lot, but both selling and buying a home isn’t as easy as handing a homeowner a down payment of $50,000 in cash and now the home is yours. There’s a lot of paperwork, scheduling, forms to submit and many other aspects that need to go smoothly for you to get or sell your home as fast as possible.
The time it takes to do all that yourself often isn’t worth the hassle.
Real estate agents do all that for a living, so they understand how to effectively navigate the bureaucracy of the whole process and help you get your home or sell it quickly.
If you want to sell your home or find a new one that perfectly matches your needs, it’s best to get it done with the help of a real estate agent.