You can typically negotiate commissions with the real estate agent regardless of what type of fee they charge. You should also be involved in any additional marketing budget decisions and only choose what you want, as that can affect the real estate commission fee you pay and how much interest is ultimately generated in your property.
The simple answer is that real estate agents help you sell your house –hopefully for a good price. There’s a lot of work involved in selling a home, such as:
You can find real estate agents by searching online or visiting them in person, but it can take time to decide whom you want to hire to sell your home. An agent with a cheap commission could save you money but might not necessarily get you a good deal. Depending on what they charge, you’ll typically have to pay a more experienced and skilled agent a higher commission fee .
Consider the following when looking for an agent:
It’s a good idea to contact multiple agents for quotes, the same as you would if you were hiring a tradie. Ask them questions about their sales strategy and how they communicate with potential buyers and try to get a feel for the quality of their work before you decide to hire them.
As real estate agents provide a service, their commissions incur Goods and Services Tax (GST), which must be disclosed on any quote provided to a potential customer. Real estate agents cannot charge you separately for the GST component of their commission/fees.
You will usually have to pay an auctioneer fee if you want to sell via an auction. The auctioneer can be the real estate agent you’ve hired, provided they have an auctioneer licence on top of their real estate licence. Alternatively, you can hire an auctioneer separately for the big day.
Auction fees will vary based on the auctioneer. If the real estate agent is also the auctioneer, they may include the auction fee in their final commission. These fees will again vary depending on the individuals you’re working with and their respective experience and skill levels.
While you might have to pay your marketing costs upfront, you’ll typically only pay your real estate agent’s commission at settlement. If your agent works on a flat fee basis, you’ll likely have to pay upfront regardless of whether the house sells or not.
If your real estate agent’s commission is unconditional, it must be paid once the contract for the sale is entered or exchanged. This sounds innocuous, but it could be risky, as if the sale falls through before settlement, you’ll still have to pay the agent’s commission.
This could leave you out of pocket and subsequently set back your plans to sell your current property. For this reason, you may want to do your research on unconditional real estate agent commissions and make your own decision as to whether you’re comfortable taking that risk or not.