Every broker-owner is having the same conversation this year. Producing agents want a bigger split. New flat-fee and 100%-commission shops keep pulling recruits with the promise of keeping every dollar. Traditional splits are compressing from both ends, and it's easy to convince yourself the model itself is broken.
The data says otherwise. A recent analysis of 157 North American brokerages by AccountTECH found that 69.4% of firms reported positive EBITDA margins in 2025, up from just 55.8% in 2023, and the population of loss-making brokerages fell by more than 30% over the same period. Industry analysts have called it a broad-based improvement, not a story about a few winners at the top.
So the real question for an Ontario broker-owner isn't whether a profitable brokerage is still possible. It plainly is. The question is what the profitable ones are doing that the shrinking group isn't. This piece is about how the split squeeze actually works, why competing on price alone is a losing game, and where the margin comes from in a brokerage that stays profitable while offering competitive splits.
The split squeeze — what's actually happening
The pressure is real and it comes from three directions at once.
Producing agents know their leverage. An agent generating serious volume knows what a bigger split is worth to them and how easy it is to move. Every year the ask creeps up: 80/20 becomes 85/15, 85/15 becomes 90/10, and the cap conversation starts earlier.
Flat-fee and cap models have reset expectations. A brokerage like Real charges a straight 85/15 with a $12,000 annual cap; other 100%-commission shops offer flat fees or per-transaction charges and hand the agent everything above. Whether or not those models actually pay better for a given agent (the total cost of doing business rarely favours the simple version), they've moved the anchor point in every recruiting conversation you'll have.
Post-settlement uncertainty has agents shopping. Industry analysts point to real-estate commission changes as a moment when agents re-examined their arrangements and the value they were getting for their split. Many of them did, and moved. Some are moving back.
The pattern isn't going to reverse. Traditional splits at the top end are being competed away, and profitable brokerages are the ones that already understand you can't just hold the line on price.
Why you can't win by chasing splits alone
Here's the trap. When a producer threatens to leave, the reflex is to bump the split. Do that enough times and you've matched the market on split and destroyed the margin that funded everything else your brokerage does — the compliance function, the office, the technology, the manager who coaches the newer agents. You've kept the roster and killed the business.
The profitable brokerages in the AccountTECH data aren't winning by out-splitting the flat-fee shops on price. They're winning on a different arithmetic: their cost per deal is low enough that a competitive split still leaves a real margin. That's the whole game, and it has almost nothing to do with the split percentage itself. It has to do with what's happening on the other side of the P&L.
Where brokerage margin actually lives
Look at a brokerage's cost structure and, once you strip out rent and the things you can't touch, most of what's left falls into a small number of buckets:
- Deal processing and administration — the people, time, and systems that take a signed deal from contract to close, get the paperwork clean, get the file compliant, and get the agent paid.
- Compliance and finance — trust-account reconciliation, RECO filings, FINTRAC program maintenance, audit preparation, bookkeeping, financial statements.
- Commission payout operations — the mechanics of calculating, splitting, deducting, remitting, and paying commissions accurately and on time.
- Owner and manager time — often uncosted, always finite; every hour the owner spends on operations is an hour not spent recruiting or leading.
Notice what's on that list and what isn't. The split — the number every recruiting conversation obsesses over — isn't a cost line at all. It's a revenue-share ratio. What actually decides whether a brokerage makes money at 80/20 or at 90/10 is how efficient the operation behind it is. A brokerage carrying two full-time admins to process the same deal flow another firm handles with lean managed operations is running with a cost disadvantage of tens of thousands of dollars a year — and that is what forces the choice between offering a competitive split and staying in the black.
The three levers a profitable brokerage actually pulls
The winning brokerages tend to pull the same three levers, in some combination.
Lower cost per deal. They've turned deal processing, trust reconciliation, commission calculation, and compliance from time-intensive manual work into something closer to a production line — either through internal systems that genuinely scale, or through managed operations that handle the volume without headcount growth. Every dollar of cost taken out of a deal is a dollar the owner can either keep as margin or give back to the agent as a better split. Same P&L outcome, better recruiting story.
Match the split model to the actual cost of servicing the agent. A tenured producer who generates their own leads, closes cleanly, and needs almost no coaching is a different cost profile than a first-year agent who needs supervision, training, and hand-holding through every deal. Blanket splits ignore that. Graduated, capped, or model-specific arrangements let a brokerage share more upside with self-sufficient producers (the ones threatening to leave) while still charging appropriately for the support new agents genuinely consume.
Free the owner to actually lead. In small and mid-sized brokerages the owner's own time is one of the largest hidden costs. Every hour the owner spends personally chasing a deal file or a payout is an hour not spent recruiting the next agent, coaching the current ones, or working on the business. Profitable brokerages tend to have owners whose time is redirected toward the activities that grow the roster and hold it — and that's only possible when the operational back end is running without them.
Where a managed back office fits into the P&L
There's no way to talk honestly about profitability without talking about back-office cost, because that's where most brokerages' margin either survives or dies. A brokerage running its back office in-house is carrying fixed staff cost, key-person risk (what happens when your one admin quits during audit season?), and the owner's own uncompensated time. It works — until agent count grows, or a compliance requirement changes, or a single hire leaves.
A managed back office, done right, turns most of that into a variable, scalable cost. It isn't outsourcing your brokerage's identity, and it isn't buying software your team still has to operate. It's someone else running the deal processing, trust reconciliation, commission payouts, and compliance mechanics as an extension of your team — so your cost per deal drops, your compliance posture stays inspection-ready, your producers get paid fast, and your own time is freed to focus on the parts of the business only you can do.
That's the model myAbode is built around. And it's exactly the arithmetic the AccountTECH profitability data points to: the brokerages winning right now aren't the ones with the highest split or the biggest office. They're the ones whose cost structure gives them room to compete. (See In-House vs Offloaded Deal Processing: The Real Cost for Ontario Brokerages and How Canadian Brokerages Can Reduce Overhead Without Slowing Growth.)
Stay Profitable Without Losing the Split War — Talk to myAbode
The split squeeze isn't going away, but the AccountTECH numbers are a useful reminder that a majority of brokerages are making it work, and more of them every year. The ones that stay profitable share a common shape: they've made their cost structure lean enough that a competitive split still leaves margin, they match their model to how much support each agent actually consumes, and they free the owner from the operational grind so the leader's time goes where it earns.
If you're a broker-owner watching splits climb and margin shrink, the fix isn't to match the flat-fee shops on price. It's to fix the arithmetic underneath, so you can afford to compete without giving away the business.
Talk to myAbode. We run your deal processing, trust reconciliation, commission payouts, and compliance as an extension of your team — the operational backbone that lowers your cost per deal, protects your margin, and gives you the room to offer the splits your producers want without breaking the P&L.
Sources referenced
- Brokerage profitability data. 69.4% of 157 brokerages reported positive EBITDA in 2025, up from 55.8% in 2023; loss-making brokerages down 30%+ since 2023. Source: AccountTECH via HousingWire (January 2026).
- Modern split benchmarks and cap models. 85/15 splits with capped commission structures (e.g., Real Broker's $12,000 cap); flat-fee and per-transaction models. Sources: Speicher Group; Colibri Real Estate.
- Total cost-of-doing-business shift and the move to 100% models. Source: The Mountaineer.
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