Tasmania has some of Australia's highest commission fees. So if you're thinking of selling your property, it's now more important than ever to understand how commissions and fees work. Tasmania's real estate commission and service fee structure is deregulated. Deregulated fees give the agent the authority to set the price of their commission and fee structure in the way they choose. A few key factors drive real estate agent fees in Tasmania:
Supply and demand
Essentially, an agent will create their commission rate based on supply and demand. For example, when more agents are working in a certain area (like metropolitan areas), you can expect lower commission rates as agents compete for your business. On the flip side, the lower the activity in the property market (like in rural areas), the higher the fee will be. The lack of competition and lower selling prices allows the agent to set a higher commission.
Property value and type
A real estate agent's fees can also differ significantly depending on the region, suburb and property type. Most agents will ask for a higher commission if you're attempting to sell an unusual property. This is to compensate for the extra time and effort involved in the selling process and advertising such an exclusive property to a smaller set of potential buyers. Alternatively, if you want to sell a property with a big price tag, expect a big commission.
Experienced versus newer agents
You'll find that newer Tasmanian real estate agents may have a lower commission rate compared to experienced agents as they don't yet have the sales history or market knowledge. Before deciding on which real estate agent to choose, do your research via LocalAgentFinder to find a quality agent that ticks these three main boxes:
Has experience selling similar properties
Has comprehensive knowledge of the local property market
Offers a reasonable commission
Knowing the average commission rate for your state is a great guide for what you should be paying. However, it's also worthwhile getting a solid understanding of what is included in your commission and fee structure and what falls under each category:
Commission: It's common practice for agents to charge commission as a percentage allocation of the total selling price, whereas fees are normally an additional cost.
Fee: Common additional real estate fees outside of the commission rate include marketing costs and auctioneer fees.
Because Tasmanian commission rates are among Australia's highest, we recommend having an open conversation with your real estate agent and seeking full clarity on what costs fall under each term. This way, you'll be able to make an informed decision on what you feel is a fair commission and fee rate for selling your property.