How Much Do Real Estate Agents Make in Canada 2024?

With the high cost of housing in Canada, you might wonder how much real estate agents make. Many reality TV shows often glamorize these jobs, showcasing agents selling multi-million dollar homes and making boatloads from the commission.

While that’s not the norm, it does happen here and there. However, most agents earn a far lesser salary than their TV counterparts.

According to the Government of Canada’s Job Bank’s report, real estate agents earn between $24,746 and $134,783, with a median salary of $46,212.

But an agent’s salary isn’t cut and dry – many facets go into it. Let’s find out what makes up the ins and outs of a real estate agent’s potential income.

How Much Do Canadian Real Estate Agents Make by Province?

This is the latest data on real estate agent salaries in Canada, according to the Job Bank. Note that Nova Scotia, Prince Edward Island, and the three territories are excluded from this table due to data limitations.

Annual wages by community/area:

As noted above, the median salary across all of Canada was $46,212. I found it quite shocking that Newfoundland real estate agents had the highest median income at $61,130 and Ontario had one of the lowest at $45,586.

This could perhaps be explained by lower competition or fewer people wanting to be realtors in Newfoundland. Newfoundland realtors must also be selling way more houses on average than in British Columbia or Ontario because the costs would be much lower per house.

How Do Real Estate Agents Make Money?

With most jobs, you usually have a set salary or an hourly figure to give you an idea of how much you’ll take home each week. The real estate industry is completely different. Agents don’t have the luxury of a recurring weekly paycheck of the same amount.

Instead, they rely on commissions. Commissions are paid to brokerages for their help in the sale or purchase of properties. It can be a flat fee, but more commonly, it’s a percentage of the property’s selling price.

How Commissions Work

Commissions in Canada range from 3%-7% of the final purchase price and can be negotiated per deal. But this whole amount usually doesn’t just go to one realtor. It’s often split between the seller’s and buyer’s agents.

For example, if the final purchase price of a home is $500,000 and the commission rate is 5%, the total commission comes to $25,000. That amount usually gets split between the two realtors totalling $12,500 each.

How Many Homes Do Real Estate Agents Sell Per Year

The average real estate agent isn’t selling houses every day. I pulled average sale statistics from 2021 for Toronto real estate agents from CREA, and the results are pretty eye-opening.

Here are some interesting highlights from this data:

1. Predominance of Low Volume Agents: The majority of agents in Toronto (61.6%) sold between 0-2 properties in 2021. This might be due to a high number of part-time agents, newcomers to the industry, or high competition.
2. High-Volume Agents Are Rare: Only 0.4% of agents sold more than 50 properties in 2021, demonstrating that high-volume agents are very rare, and selling such a large volume is an exceptional achievement in the Toronto market.
3. Agents Selling 3-5 Properties: The next largest group after 0-2 properties sold is the 3-5 properties sold bracket with 17.2%. This indicates a steep drop-off in the number of properties sold as the volume increases.
4. Selling No Properties: Interestingly, 32.5% of agents did not sell any property in 2021. This could be due to a variety of reasons, including but not limited to competition, economic conditions, or these agents pursuing real estate as a part-time endeavour.
5. Extreme High-Volume Agents: Only 0.1% of agents sold more than 100 properties, suggesting that such high performance requires exceptional resources, networks, and strategies in the Toronto real estate market.
6. The Middle Market: Agents selling between 6-30 properties represent about 20.1% of all agents, suggesting a relatively small but stable “middle market” of agents who can sustain a consistent volume of sales.

These numbers might seem lower than what you were expecting, and overall, probably aren’t making the agent rich.

In addition to how much an agent sells, individual brokerage fees and administrative expenses also decrease their commission portion.

Commission Breakdown After Expenses

While the example above has the agent pocketing $12,500, that’s not the case. There are additional brokerage transaction fees that vary depending on where the agent works, along with operational expenses to keep the brokerage running.

Here’s a look at the breakdown:

• Brokerage Transaction Fee – Normally, the brokerage takes a cut of the commission. It can be anything from 10%-30% of the agent’s commission. The brokerage uses these fees for administrative and marketing costs.

• Operational Expenses – Real estate agents also usually need 20%-30% of their commissions to cover their everyday expenses. This includes things like:
  • Car Payments
  • Insurance
  • Gas/Parking
  • Home Office Supplies and Expenses
  • Continuing Education

If we take the above example of the agent earning a $12,500 commission and then include the a 20% brokerage transaction fee and operational expenses fee, the agent comes out with a bottom line of $6,250.

If the typical agent only sells around six homes on average, that totals $37,500. Of course, not every property the agent sells will have a $500,000 purchase price. Some might be more and some less, but this example shows it isn’t as easy to make money as a real estate agent as some people think.

How Agents Spend Their Time

If selling six houses on average seems low, consider how most agents spend their time. From the minute a seller contacts an agent until the property sells, real estate professionals spend countless hours doing work behind the scenes to get their client the best deal.

First, they will need to make an initial site visit to scan the property and gather information. Next, they’ll need to do a market analysis of comparable houses nearby. From there, an agent can gauge attractive pricing options.

As soon as the house is listed, agents can set up open houses, individual appointment times, and negotiate any offers. Finally, once an offer is accepted, the final paperwork needs to be prepared.

This whole process can take much time and effort. Good real estate agents are always actively looking to boost the property – from giving their sellers tips to produce a good showing and sometimes even staging the home for added benefit.

Is Real Estate a Good Job In Canada?

Over the past ten years, average real estate prices have almost doubled. In some places like Vancouver and Toronto, it’s even more than doubled. From that stat alone, getting into the real estate business seems like a good idea.

But before you get ready to sit for a licensing exam, you might want to consider that not all agents, and housing markets, are the same.

And while there’s been a housing boom in recent years, that doesn’t mean all realtors are millionaires. Top brokerage earners tend to sell at least one house a month.

As we already know, that’s way more than average, so they’re already at the top of the game. But if an agent is claiming to make over $1 million, they’re at the top echelon of their craft and not the norm.

The top ten percent earn over $100,000 – closer to $150,000. While that’s not a bad chunk of change, it’s not the millionaire status some reality shows will have you believe.

Homes Sold Per Agent By Province

Here’s a table created using 2021 data from CREA:

Some interesting notes about this data:

1. Highest Ratio of Homes Sold per Agent: Saskatchewan has the highest ratio of homes sold per agent (17.92), indicating a high level of productivity per real estate agent, potentially due to a combination of high demand and a relatively low number of agents.
2. Lowest Ratio of Homes Sold per Agent: Ontario, despite having the highest total number of homes sold in a year (314,292), has the lowest ratio of homes sold per agent (3.98). This might be due to the high competition among real estate agents in the province.
3. Most Active Market: Ontario has the highest total number of homes sold per year, which indicates that Ontario’s real estate market is the most active among the provinces listed.
4. Less Competitive Markets: Provinces such as Manitoba, Saskatchewan, Nova Scotia, New Brunswick, and Newfoundland and Labrador have relatively high homes sold per agent ratios, ranging from 11.57 to 17.92. This could indicate less competition among real estate agents, higher demand, or both.
5. Dense Marketplaces: British Columbia and Ontario have relatively high numbers of homes sold annually and a relatively high number of agents, indicating dense and possibly competitive marketplaces.

The data is interesting because I always assumed that realtors in BC or Ontario were raking in huge cash, but it seems like it might be easier to make more money in markets like Newfoundland or Saskatchewan due to the lower competition.

How to Succeed As a Realtor

To be at the top of your game and make as much money as possible, you can’t just sit around and wait for customers to come to you. Here are a few tips all successful real estate agents should follow.

• Nurture Leads – Whether following up with customers that left feedback via your website or reaching out to an acquaintance looking for a new home, actively seeking out potential customers is one of the big differences between high-level realtors and mediocre ones.

• Keep a Stager on Hand – A professional stager is a great asset when you’re looking to sell a home. Having someone that you know and trust is key to getting the job done. While it might cost you a bit more upfront, you should reap the rewards in the long run.

• Use Videos on Your Website – Most real estate agents post pictures of their listings. Take it up a notch and add videos. A simple tour showing the flow of the house might catch the attention of buyers that wouldn’t normally be interested just from the photos.

Final Thoughts

While an average agent makes around $46,212, there’s potential to make much more. The area you live in determines home prices and how much commission you make. However, real estate agents can take steps to increase their income by seeking out potential clients and staging homes effectively.

If you’re thinking of getting into the real estate market – why not try investing first? Check out these top real estate investing options.