The differences between a residential broker and a commercial broker

Residential broker

Commercial broker

Property type

A residential broker specializes in the sale, purchase and rental of residential real estate, such as single-family homes, apartments, condos, townhouses and income properties with 4 apartments or less.

A commercial broker focuses on commercial real estate, such as offices, commercial buildings, buildings with 5 or more apartments, business premises, land for commercial development, shopping centers and warehouses.

Customer

Buyers using a commercial real estate broker are typically institutional investors, corporations, real estate developers, business owners and other professionals seeking real estate for commercial purposes, such as business operations or investment. Sellers putting their property on the market generally have the same profile when using a commercial broker.

Expertise required

Residential brokers hold a residential real estate brokerage license issued by the Organisme d’autoréglementation du courtage immobilier du Québec (OACIQ). They must have in-depth knowledge of the local residential market, neighborhoods, schools, public transportation and market trends to help their clients find the home that best suits their needs and budget.

Negociation and strategy

Negotiations in the residential sector often involve emotional and personal factors, such as the design of the house or the ideal location for a family. Residential brokers work to meet their customers’ needs and desires.

Commercial negotiations focus primarily on financial aspects, such as rent, lease terms, rates of return and contractual conditions. Commercial brokers must be able to maximize profitability for their clients.

Transaction process

Residential transactions are often shorter and simpler in terms of documentation and regulations.

Commercial transactions generally involve more complex contracts, in-depth due diligence and more complicated legal aspects, which can prolong the transaction process.