How Much Does a Realtor Make on a $500,000 Home Sale in Ontario?
The short answer for a $500,000 sale at the most common Ontario commission structure: $25,000 in commission, plus HST — split between two brokerages, then split again with the agents. Here's the full breakdown.
Start with how commission works in Ontario
There is no fixed or mandated commission rate in Ontario. Every rate is negotiable between the seller and their brokerage, and structures vary — flat fees, tiered rates, and discount models all exist. That said, one structure is by far the most common on a traditional full-service listing: a total commission of 5% of the sale price, split evenly — 2.5% to the listing brokerage and 2.5% offered to the buyer's brokerage as the co-operating commission. The example below uses that common structure so the math is concrete; your own listing agreement is the only document that states your actual rate.
The math on $500,000
- Total commission at 5%: $500,000 × 5% = $25,000
- HST (13% in Ontario), charged on the commission: $25,000 × 13% = $3,250
- Total cost to the seller: $25,000 + $3,250 = $28,250, paid out of the sale proceeds at closing
- Listing brokerage's share (2.5%): $12,500 + HST
- Buyer's brokerage's share (2.5%): $12,500 + HST
So no single person "makes $25,000." Two brokerages each receive $12,500 (plus the HST, which they remit to the government — it isn't income). What happens next is the part most people never see.
The brokerage is not the agent
The commission is paid to the brokerages, not directly to the salesperson you worked with. Your agent then receives a portion of their brokerage's share according to the split in their agreement with that brokerage. Splits vary enormously across the industry — a newer agent at a full-service brokerage might keep half of the brokerage's share, while a top producer might keep nearly all of it and pay the brokerage flat fees instead. On the $12,500 brokerage share in this example, the individual agent's gross could reasonably be anywhere from roughly $6,000 to over $11,000 — before their own expenses, which are real: marketing, photography, licensing, insurance, board fees, vehicle, and the uncompensated work on listings that never sell and buyers who never buy.
Who pays, and when
In the standard structure, the seller pays the full commission — both halves — from the sale proceeds on closing day, as set out in the listing agreement. The buyer's brokerage is paid through that arrangement, which is why buyers don't usually write a separate cheque for their agent's work. (If a buyer views a home offering a lower co-operating commission, their own representation agreement may say they top up the difference — one of several reasons to read that agreement before you shop, not after.) Commission is earned on a completed sale; a listing that expires unsold typically pays the brokerage nothing for the sale itself, though some agreements include a fee if the home sells to a buyer introduced during the listing period shortly after expiry.
What the seller actually controls
Because the rate is negotiable, the useful questions at a listing interview aren't "what's the rate?" but "what does the rate buy, and what's the split?" A seller can negotiate the total, the co-operating portion offered to buyer brokerages (which affects how the home competes for buyer attention), and what's included — staging, photography, marketing spend. The cheapest commission on a poorly marketed home is usually the most expensive outcome; the goal is the best net number after all costs, not the smallest line item.
What changes with a discount or flat-fee structure?
The $25,000 figure assumes the common 5% structure — it is not a law of nature. Sellers can and do negotiate other arrangements: a lower percentage, a flat fee for the listing side, or a "list it on MLS" service where the seller's brokerage does little beyond exposure while the seller still offers a co-operating commission to bring buyers. Run the same $500,000 sale with, say, a 1% listing fee and a 2.5% co-operating commission and the total is 3.5% — $17,500 plus HST — with the listing brokerage's share at $5,000 instead of $12,500. What changes besides the price: the service level, the marketing included, and sometimes the pool of buyer agents paying attention. The math is easy to vary; knowing which services you're trading away is the part that takes a conversation.
The bottom line
On a $500,000 Ontario sale at the common 5% structure: $25,000 in commission, $3,250 in HST, $12,500 to each brokerage, and from there, a negotiated slice to the agent you actually dealt with. Anyone quoting you a single agent's take-home from a sale price alone is skipping two layers of the split.
Next step
Commission is only one line in a sale — see the full picture in our guide to closing costs in Ontario, line by line.