If you’re buying or selling a home in Ontario and wondering how much your realtor makes from a $500,000 sale, the answer depends largely on commission rates, local market norms, and brokerage arrangements. Let’s break down what you can expect.

Typical Real Estate Commission Rates in Ontario

In Ontario, the most common commission structure for residential real estate sales is a percentage of the sale price, typically between 4% and 5% total, split between the listing (seller’s) agent and the buyer’s agent. A very common arrangement is:

• 2.5% to 2.75% for the listing agent
• 2.5% to 2.75% for the buyer’s agent

While these percentages aren’t set by law and remain negotiable, the 5% total commission (2.5% per side) remains a strong market standard.

What Does That Look Like on a $500,000 Home Sale?

Let’s use the 5% split evenly between buyer and seller’s agents as an example:

• Total commission at 5% = $25,000
• Listing agent’s share = $12,500
• Buyer’s agent’s share = $12,500

So, if you’re selling or helping a buyer purchase a $500,000 home in Ontario, each agent will typically receive $12,500 in gross commission.

What Happens After the Commission Is Earned?

It is important to understand the gross commission is not the same as what the realtor actually takes home. Most realtors work under a brokerage, with which they split commissions. The split can vary widely but commonly ranges from 50/50 to 80/20 favoring the agent depending on factors like experience, production level, and negotiated terms.

For example, if a realtor has a 70/30 split with their brokerage, and earns $12,500 in commission for the sale, their gross commission payout from the brokerage would be:

• $12,500 x 70% = $8,750

From this amount, realtors still need to cover their own expenses, such as marketing costs, insurance, continuing education, and taxes.

Negotiability and Market Factors

• Commissions are negotiable — some sellers seek to reduce fees by negotiating lower commission rates, especially in high-volume or luxury markets.
• Seller-paid commissions cover both seller and buyer agents, so the buyer typically pays nothing directly.
• Sometimes, discounts or flat-fee options are offered but are less common in Ontario’s traditional real estate market.
• Market conditions—such as a buyer’s market or seller’s market—may give more leverage for lower or higher commissions.

Summary: How Much Does an Ontario Realtor Make on a $500,000 Sale?

• Gross commission (before brokerage splits): About $12,500 per agent (based on a 5% total split evenly)
• Net commission to agent (after typical brokerage split): Likely between $6,000–$9,000
• Final take-home depends on the individual split agreement with their brokerage and personal expenses.

Understanding these numbers can help buyers and sellers better appreciate the real estate agent’s role, the value provided, and where commission dollars go. If you are buying or selling in Ontario, asking about commission breakdowns upfront is a good idea to make informed decisions.

HomesFound.ca is committed to helping Ontarians navigate the real estate market with transparency and confidence.