When it comes to selling a house in Australia, there’s a lot more to consider beyond the fees for your estate agent. Costs can add up quickly; learning about the various expenses you’re likely to encounter is key to making the selling process as smooth and seamless as possible.
From marketing fees to tax deductions, you’ll find everything you need to know and vendor costs below so that you can forecast your likely expenditure and budget accordingly.
What are the Different Costs Involved in Selling a House in Australia?
Vendors face a multitude of costs during the sale of a house in Australia. We can summarize these as follows:
- Estate agent fees
- Marketing costs
- Conveyancing fees
- Lender fees
- Styling costs
- Capital gains tax (for expats and property investors)
Each of these costs is explored in detail below.
Estate Agent Fees
Fees paid to your estate agent for connecting you with a buyer and helping you land a competitive price will likely be your largest expense. There are two types of agent fees used in Australia:
- Flat fee : where a specific fee is agreed upon before the property is listed on the market. This fee remains the same regardless of the final sale price.
- Commission : where the agent receives a small percentage of the final sale price upon purchase.
There are a couple of important details to note with agent fees. Firstly, some estate agents may charge fees even if the sale of the property falls through. Secondly, some agents may charge bonuses where the property sells above its expected price.
Be sure to iron out all fees with your agent before reaching an agreement. Generally, estate agent fees will cost anywhere between 1.5% and 3.5% of the final sale value.
Alternatives to Estate Agents
Contracting a realtor isn’t the only way to sell your home. There are alternatives, such as using an auction house or even selling the property yourself.
However, these alternative methods incur fees of their own. For instance, you’ll need to pay between $400 and $1000 in auction fees if you want to sell your home under the hammer.
Most estate agents will recommend launching a marketing campaign to advertise your property to prospective buyers in the best light possible. This includes things like online listings, professional photography, copywriting, a floor plan, and a ‘For Sale’ sign outside your house.
In many cases, the estate agent will absorb marketing costs into their fee. However, some agents may charge these services as an additional extra. As always, make sure to discuss these terms with your agent.
Marketing costs will vary widely depending on the property and your selling strategy. For an extensive marketing campaign, you’ll need to set aside at least $5,000.
Conveyancing fees are an unavoidable cost when selling your house. Transferring legal ownership of a property from one owner to another is required for every property sale, and the process must be carried out by a licensed conveyancer or solicitor.
Hiring a professional to help you through the transfer process will be among the smaller costs you encounter while selling your property. Fees vary, but budget between $1000 and $3000 for conveyancing.
If you’re yet to pay off your mortgage on the home you’re selling, you’ll need to pay your lender an early exit fee. This covers any administrative costs associated with the settlement of your home loan.
Lenders charge their own rates for this service. Generally, lender fees will cost between $150 and $1,500.
Beyond large-scale renovations, your estate agent is likely to recommend certain styling improvements to make your property more attractive to prospective buyers and extract the best sale price possible.
Stylistic improvements include things like cleaning, painting, gardening, and repairs. You can even hire a professional stager to get your house in tip-top condition for viewings.
The amount you choose to spend on styling will depend on the current condition of your house. If there’s a lot of work to be done to get your property market-ready, you may need to spend as much as $5,000.
Capital Gains Tax
Another cost to consider if you’re selling a house that you don’t live in (expats and property investors: we’re looking at you!) is Capital Gains Tax (CGT). This is the tax you’re liable to pay if you make a net profit on the property after the sale goes through.
How is Capital Gains Tax On a Property Sale in Australia Calculated?
To find out if you’re required to pay CGT, you need to calculate the total amount of money you’ve spent on the property and the amount you’ve received back after the sale. Your capital gains (or losses) are the difference between these two numbers.
When working out how much you’ve spent on the house, including any purchase fees, ownership expenses, and renovation costs from over the years. The total sum can then be deducted from the final sale price (minus all the vendor fees explored above) to calculate your capital gains.
Some exemptions and partial exemptions apply. For instance, if you’ve owned the house for more than 12 months, you’ll receive a 50% discount in CGT. There are a number of other conditions that are worth exploring in greater detail on the ATO website .
Crucially, CGT is taxed along with your other assessable income at your marginal rate of tax. If you’d like to work out your likely CGT deductions on a property sale, use the ATO’s Capital Gains Tax calculator .
What is the Total Cost of Selling a House in Australia?
The total cost of selling a house depends on the property’s value and location. As a rough guideline, agency fees are 1.5–3.5% of the sale price, marketing costs are $1k–$8k, conveyancing fees are $1,000–$3,000, lender fees are $150–$1,500 and styling fees are $200–$5,000.
Once you’ve begun to consider your personal circumstances in greater detail, such as the condition of your house and whether you’ll be required to pay Capital Gains Tax, you’ll be able to make more precise estimates of your likely expenditure.
How Much Do Estate Agent Fees Cost When Selling a House in Australia?
Marketing costs, conveyancing fees, lender fees, and styling fees are priced fairly similarly across Australia. However, agent fees differ from state to state. Here’s a rough outline of the standard agency costs in different parts of the country: