Selling your home is expensive; the biggest expense is undoubtedly real estate agent fees. One of the easiest ways to estimate your home sale costs is to use a real estate commission calculator. Today we’ll talk you through how to use our free online service and other selling costs to consider.
How to use our real estate agent commission calculator
It’s so simple to use our commission calculator.
1. Obtain an estimated property value
The first point of data you need to use our calculator is house price, and there are a few different ways you can determine your property price.
Free online property valuation
Firstly, you can use our free online property value estimate tool. These are the factors we consider when determining the estimated value:
- Recent sales data from the past 12 months. This includes the median sale price, the number of similar properties sold and how long they sat on the market.
- Local data like your suburb’s real estate trends and the most common type of property sold.
- Property data like its features (the number of bedrooms and bathrooms), type and condition.
Free property appraisal from a local real estate agent
A free property appraisal from a local real estate agent considers the above factors and more. This includes greater real estate market trends, the time of year you hope to sell, current economic conditions and local amenities.
Professional property valuation
This differs from an appraisal, as a formally qualified valuer completes the task for a fee. For example, this is a legally binding report you can use in a property settlement or to obtain a home loan.
So, choose your method and get that estimated property price before we move on to step two.
2. Calculate!
Yes, getting your home value is the hardest part. We use the average commission rate of 2.29% “based on active real estate agents live on LocalAgentFinder”. The average real estate commission is currently 2.08% in metropolitan cities and 2.45% in regional areas, but here’s a more thorough breakdown:
- Australian Capital Territory: 2.17% and 2.18% in Canberra.
- New South Wales: 2.17% overall and 1.87% in Sydney.
- Northern Territory: 2.49% in both the NT and Darwin.
- Queensland: 2.56% and 2.52% in Brisbane.
- South Australia: 1.94% and 1.9% in Adelaide.
- Tasmania: 2.71% or 2.67% in Hobart.
- Victoria: 2% and 1.93% in Melbourne.
- Western Australia: 2.32% and 2.28% in Perth.
Input this data into our commission calculator, and you’ll instantly have your estimated commission. Try the free service today.
The different real estate agent commission structures
It’s important to remember there are three main commission structures that affect how much commission you pay.
Fixed fee
A flat fee or fixed commission rate means you pay a specific dollar amount, no matter your final sale price. Some sellers prefer this method because it provides peace of mind over the price.
Fixed percentage
Fixed percentage is the most common, and the percentage amount doesn’t change, regardless of your home’s sale price.
Tiered percentage
A tiered commission rate is like a bonus scheme that encourages real estate agents to secure a higher sale price and operates on a sliding scale. For example, you may agree to a 2% commission rate if the property sells for $480,000 or less and an additional 10% rate if the property sale exceeds this purchase price.
Factors that affect commission rates
Here are the main factors that affect real estate agent commission fees:
- Property type. For example, selling a standard home will require less effort than selling a unique home with a smaller pool of potential buyers. So individual agents may charge a higher commission to compensate for the extra effort.
- Property value. Real estate agents may charge less if your property has a higher value.
- Location. Regional areas equal less competition and higher rates. Metropolitan cities equal greater competition and lower rates.
- Current market conditions. For example, if homes sell like hotcakes while on the market for mere days, like in Sydney, you can expect a lower rate.
- Experience. Top agents with extensive local market knowledge typically charge higher rates as you’re paying for their experience. The hope is that the increased rate equals a higher sale price. But don’t write off newer agents, just do your research via LocalAgentFinder to make an informed decision.
Other selling costs to consider
Several other costs are involved with a property sale besides agent fees that you should consider before estimating your final net sale proceeds.
Marketing costs
Marketing and advertising costs usually equal 0.5% to 1% of the home’s value. The advertising expenses should include:
- Online marketing, like property listings on big real estate websites and social media marketing.
- Print property listings in local newspapers or magazines.
- A “for sale” sign outside your property.
- Professional photography and videography.
- Advertising flyers for open house inspections.
Auctioneer fee
Auctioneer fees are a separate cost and usually average about $600.
Home staging fees
Home staging is preparing your home for open house inspections, a professional photo shoot or auction day. It can range from simple styling tips to furnishing your entire home. Costs can vary between $2000 and $8000, depending on the level of service, property size and the campaign’s duration.
Conveyancing fees
Legal and conveyancing fees are a mandatory part of the property sale process, ranging from $700 to $1300.
Mortgage discharge fee
Your bank or home loan lender charges this fee (usually between $150 and $350) for discharging your mortgage early.
Capital gains tax
Capital gains tax is a separate cost to consider when selling investment properties.
Now you have all the information you need to create a budget and estimate your home sale proceeds.
FAQs
How do you calculate a real estate agent’s commission?
To calculate an agent’s commission rate, you’ll want to multiply the property value and commission together. For example, $1,000,000 x 2.29%. Our real estate agent commission calculator does this math for you.
What percentage do most realtors charge in Australia?
This depends on several factors, but most agents charge between 2% and 2.5% commission.
Can you negotiate fees with real estate agents?
Real estate commissions are deregulated in Australia, which means you’re well within your rights to negotiate a lower rate. It’s a fairly common practice, so here are some tips:
- Do your research and compare agents with LocalAgentFinder first. When you know the agent’s fees, average commission and local performance, you’re in the best negotiation position possible.
- Don’t be afraid to tell potential agents that you’re interviewing several agents, and this may incentivise them to “price match” a competitor.
- Remember the above factors that affect an agent’s commission rate.
- Confirm exactly what’s included in the agent’s fee and get the breakdown in writing.
Ready to find a local real estate agent to sell your home?
Head to LocalAgentFinder to use our free comparison service. Compare top agents in your area based on their performance data, agent fees and homeowner reviews.