A good real estate agent will be a valuable asset when you’re selling your home. An agent who knows the market, understands how to advertise your home, has a good network of potential buyers and is a good negotiator, can get the best price possible for your property.
How much does an Agent charge to sell my property?
Agent commissions have been deregulated in Queensland and therefore you may see some variation between Agents. Remember you get what you pay for. Some of the factors that can influence the rate of commission can include the value of the property, the degree of difficulty of the task, the expectations of the seller and the timeframe available to achieve the best possible outcome.
But be careful to properly evaluate what you get for your money - the services offered and the reputation and experience of the agent/agency not only in selling in your geographical area but also importantly, their experience in marketing properties similar to yours.
The truth about commission vs fee:
Commission is only payable when a sale is negotiated at a figure that is acceptable to you as the seller.
Commission provides the agent with a reward for working hard and doing their job successfully but also acts as an incentive for excellent performance.
Some so-called fee-based agents still charge a commission (renamed as a fee) and often charge half the amount upfront (or sometimes the full amount). The problem with this system is that if the agent does not sell your property, the upfront fee is not refunded. Doesn’t seem right, does it? The other drawback is that a flat fee might not motivate your agent to get the best price possible for your property – with them potentially prioritising a quick sale over achieving the highest price. Conversely, commission calculated upon the successful sale of the property is based on a percentage of the sales price paid only when its sold. So it’s in the agent’s best interest too for his vendor to achieve a sale at the best possible price.
A good agent earns his/her fee.
Flying in the face of claims that real estate agents make exorbitant incomes, according to independent resource PayScale, the average real estate agent in Australia only makes a modest income of $47,457 p.a.
The individual agent themselves only earns a portion of the commission for each sale with the balance going to the agency he/she is working for (to help cover the significant costs of doing business in a highly-regulated and online world). When you consider that on a regular basis many agents work 10-12 hour days including weekends, its clear that agents certainly have to work hard to get the job done! And what if, after all that work and outlay, the whole thing goes pear-shaped and falls over due to something that the real estate agent can’t control (such as tighter lending by banks etc)?
When you put it into perspective, how many tradespeople do you know that would do all the work and put everything in place and paid to get the job done properly, only to have to wait weeks, months or years to receive payment, if at all?
Why shouldn't I try to sell my property myself?
If you’re thinking of selling your own home, remember that one of the most important skills you seek in a good real estate agent is the ability to negotiate the deal and to get the buyer up in price.
The fact is that most people do not sell and buy many houses in their lifetime (the majority only 1 or 2) so the average person does not have this skill.
And selling is a very emotional time for all parties, therefore you need an objective party handling the negotiations. (Even real estate agents will tell you they have difficulty selling their own homes as they are too emotionally vested!). As a seller, it is natural to focus on what you can save (i.e. an agent's commission) but all too often we see it comes at a price - and that is that you are likely to achieve far lower selling price for your home. The idea is to look at the overall result achieved - what you end up with in your hand. A good agent should achieve a result that more than covers the cost of their commission.
The other important factor is the state of the market. Cheap outfits may be successful in a buoyant market when properties sell easily and quickly but when the market changes, these guys disappear and it will become even more important to seek out an experienced agent who has longevity and a good database of potential buyers.
For additional information, click here to see the top 5 fails when selling your home yourself.
Will I have to pay for the marketing and advertising expenses?
Marketing is tailored to the needs of each property/owner with the view to maximising reach with its target market. Website marketing has certainly seen some huge increases in costs in recent times and the recommended marketing strategy and any associated costs can be mutually agreed upon with your Agent at the time of listing the property for sale.
Is it best to test the market by advertising my property at a higher price than I want?
This is not a recommended strategy as search engine criteria in the major listing websites (such as realestate.com.au and domain.com.au etc) will exclude your property from the search results meaning that potential buyers may not see your property at all as it will list outside of their price range. Buyers are savvy these days and use these sites to constantly research property and establish values, so if a property is over-priced, we see little enquiry from potential buyers. And given that your property will receive its fullest exposure (including new listing alerts, database marketing etc) when it is first listed, you don’t want to miss any potential buyers.
Who does the contracts in Queensland?
In Queensland, contracts are prepared by the selling agent, (we choose to use REIQ contracts) and where applicable the contract will be accompanied by the following documents when given to the proposed buyer:
- Body corporate (strata) property – an information sheet in relation to purchasing a property that is part of a body corporate, and a disclosure statement containing information about the specific body corporate, including the amount of annual contributions payable by the owner
- A Pool Safety Certificate which confirms that the swimming pool on the property complies with the regulations/legislation
When the price and terms are agreed and both parties sign the contract, the buyer pays a small deposit to secure the property.
In Queensland, “time is of the essence”. The settlement date is set by the contract - in most cases 30 days from the contract date or as negotiated. Most contracts are conditional upon obtaining a satisfactory pest/building inspection (usually 7 days) and finance (often 14 – 21 days). As soon as the buyer is satisfied with their inspection and finance (if applicable), they notify their solicitor and the contract becomes unconditional. The buyer then pays the balance of deposit to the real estate agent within the time specified in the contract. There is a 5 business days cooling-off period in Queensland commencing when the buyer's solicitors' receives a fully completed set of documents and if utilised, it can potentially cost the buyer 0.25% of the purchase price.
What are the conveyancing costs?
Conveyancing costs relate to the cost of handling all the necessary legal requirements by a Solicitor or Conveyancer on your behalf. These firms will charge you a fee which can vary depending on the organisation and how complex the transaction is. Once you have accepted an offer on your property and signed the contract, call your solicitor and provide their contact details to your real estate agent to enable the contract to be emailed to them ASAP for actioning.
Does it cost to have a market appraisal or some advice on preparing our home for sale?
No, this service is offered free of charge. We always encourage our clients to contact us for a "free market appraisal" to update themselves on the value of the property. Property values do change from year to year. On top of market increases, any renovations you have done to the property since your last appraisal will need to be considered in terms of value.
Find out what’s going on in your local area:
We can also provide you details about recent property values in your area including:
- state of the market
- comparable properties that have sold in your area
- how much they sold for
- how long they have been on the market
Thinking of renovating for sale?
We’re also happy to discuss possible renovation options with you before you start to prevent over-capitalisation or help you maximise your selling price with some pre-sale tips to help you ensure your property is presented in its best light when it is listed for sale. If you'd like to talk to us about a free appraisal for your property call us on 07 5525 2866, email request or click here.
And if there are some repairs and maintenance that you really would like to get done before you sell, click here to find out how you can "Sell Now, Pay Later" interest-free for up to six months.
Should circumstances arise that require you to seek a property valuation from a licensed valuer, you will need to engage an independent “Certified Practising Valuer”, who can provide this for you as a fee-based service.
Need further information?
To download our handy free Home Seller's Guide, click here.
**This is intended as general information only and should not be relied upon as formal legal advice. Please seek proper legal advice regarding your individual circumstances