How Realtors Get Paid: Commission Breakdown

Quick Answer: Realtors typically earn a percentage of the sale price, commonly split between the buyer's and seller's agents, and this commission is usually paid out of the proceeds at closing rather than charged directly to the buyer. Exact rates and splits are negotiable and vary by agent and brokerage.

Commission Is Usually a Percentage of Sale Price

Rather than a flat fee, most agents work on commission calculated as a percentage of the final sale price, which is why pricing strategy matters so much to both sides.

How the Split Typically Works

Commission is commonly divided between the listing agent and the buyer's agent, each representing their respective client through the transaction.

Who Actually Pays It

In most Calgary transactions, the total commission comes out of the seller's proceeds at closing, which is why buyer representation often costs the buyer nothing directly.

Rates and Splits Are Negotiable

There's no fixed, mandated commission rate. It's set through discussion with your agent and can vary based on the property, the market, and the scope of services provided.

Why This Matters for Your Decisions

Understanding how commission works helps explain agent incentives around pricing and marketing, and equips you to have a more informed conversation before signing an agreement.

Frequently Asked Questions

Who pays the realtor's commission?

In most Calgary transactions, commission comes out of the seller's proceeds at closing, covering both the listing and buyer's agents.

Is realtor commission a fixed percentage?

No, there's no mandated rate. Commission is negotiated between you and your agent based on the property and services involved.

Does the buyer ever pay commission directly?

Typically not in a standard transaction, since commission is usually deducted from the seller's proceeds rather than charged separately to the buyer.