This is the single most important thing to understand. In Ontario there is no standard commission rate, no legally required rate and no rate set by any real estate board or association. Rates are not fixed by the industry and cannot be. Every commission is a term negotiated between an individual seller and an individual brokerage, and what one brokerage charges tells you nothing about what another will.

So if anyone tells you a particular percentage is simply "the going rate" in Richmond Hill or Markham, treat that as a starting point for a conversation rather than a fact. The rate, the structure and what is included are all open to discussion before you sign.

Brokerages set their own rates based on the service they provide, the marketing they fund, the price point of the home, local market conditions and their own business model. A property that is straightforward to market may be quoted differently than one that needs extensive work, staging or a longer runway. Higher-value homes sometimes carry a different structure than entry-level ones because the dollar figure scales with the price. None of this is fixed, which is precisely why it is worth asking questions.

Commission is not payable when you list, and not when you accept an offer. It is paid on closing, out of the sale proceeds. Your lawyer receives the funds from the buyer's lawyer, pays out your remaining mortgage, remits the commission plus HST, deducts legal fees and adjustments, and sends you the net balance. You never hand over money directly: it simply comes off the top of what you receive.

Because it is deducted at closing, it belongs in your net proceeds math from the very beginning, not as an afterthought. Our closing day guide walks through everything else that gets deducted on the same day.

The figures below are a hypothetical illustration of the arithmetic only. They are not a quoted rate, a recommended rate or an indication of what any brokerage charges. Substitute whatever rate you negotiate.

Take a home that sells for $1,400,000 with a negotiated commission of 4 percent. The commission is $56,000. HST at 13 percent adds $7,280, for a total of $63,280 deducted at closing. If that 4 percent is split evenly, roughly half goes to the listing brokerage and half to the buyer's brokerage before either brokerage pays its own agent.

Change the rate and the math changes proportionally. The point of the exercise is to run your own numbers, at your own negotiated rate and your own expected sale price, before you sign, so the closing statement holds no surprises.

HST applies to real estate commission in Ontario at 13 percent, and it is charged on top of the commission itself. Sellers routinely forget this line and are caught short when they see the closing statement. Whatever rate you negotiate, add the HST before you calculate your net proceeds.

In the traditional arrangement, the seller agrees in the listing agreement to pay a total commission that covers both the listing side and the buyer's brokerage side. The buyer does not write a separate cheque. The compensation to the buyer's agent comes from the seller's proceeds.

This arrangement has evolved and buyers in Ontario are now required to sign a buyer representation agreement before an agent can show them properties. That agreement sets out how the buyer's agent is compensated. In many cases the seller still covers it through the listing commission, but buyers should read their own agreement carefully so there are no surprises. If you are buying, ask your agent to walk you through the compensation clause before you start touring homes.

Sellers in Richmond Hill and Markham can choose among full-service brokerages, discount or reduced-commission models and flat-fee listing services. These are legitimate, different business models serving different needs, and the right choice depends on your home, your timeline and how much of the work you want to take on yourself.

The useful comparison is not rate against rate, it is total value against total cost. A lower rate that comes with less marketing, no staging support or limited negotiation help may cost more in the end if it produces a lower sale price or a longer time on market. A higher rate is only worth it if the service behind it genuinely produces a better result. Ask each brokerage to put in writing exactly what is included so you are comparing like for like.

On a home in this price range, a difference of one percent in commission is real money. So is a difference of one percent in sale price, and the two are not independent of each other. Judge the whole package: the pricing strategy, the preparation, the marketing reach, the negotiating approach and the rate together. That is the honest comparison and any good agent should welcome it.

What is the total commission and how is it split with the buyer's brokerage? You should know both numbers, not just the total.

What exactly is included, and who pays for it? Photography, staging, video, advertising and open houses. Get the list in writing.

How long is the listing term and what is the holdover period? Both are negotiable and the holdover can affect you after the listing ends. Our holdover clause guide explains why it matters.

What happens if I want to cancel? Understand the termination terms before you sign, not after.

How did you arrive at the recommended list price? The answer should reference recent sold comparables in your neighbourhood, not just active listings.