Handling Commission Reduction Proposals


Does a Listing agent have to disclose to other potential Buyers, if one Buyer’s Agent proposes to reduce his commission?


The quick answer is “yes”, provided you agree and accept it.


Don’t disclose it. But, that means you don’t do it. Let them make whatever deal they wish with their own Buyer by adding a rebate to the Buyer Representation Agreement. If you agree, this will simply tell everyone that you are a weak Listing Agent.

You invited everyone at “x” % but now suddenly, just because there is one desperate Buyer with a desperate Agent, you want to challenge all the others to reduce their commissions to “y” % at the 11th hour.

Besides, if you do this, who is coming back to your next property in a week? Let the Buyer’s agent:

  • declare the correct commission,
  • split it with their own Brokerage,
  • pay the appropriate HST, and
  • pay the appropriate income tax.

With whatever is leftover, they can decide to pass that along.

Don’t make their cash shortage your problem and erode your reputation in front of your peers!

Brian Madigan LL.B., Broker


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