Real estate agent fees

Real estate agent fees

When you’re shortlisting potential agents to help sell your property, you need to know how much real estate agents charge, specifically their fees and commission. The fees and commission you pay are the largest single cost associated with a property sale, so it makes sense to know what you are being charged and how this will impact your finances.

It’s worth knowing that agent commissions are not regulated in Australia, and are ‘set’ by the market. This means that the rates or commission a real estate agent charges varies, with some commission rates including advertising and marketing costs in their commission structure, and others breaking these costs up and charging you a separate fee for them.

Commissions by state

Average real estate agent commissions

Real estate agent commission percentages in Australia vary from 1.6% to 4% of the total sale price, depending on location and the amount of competition between agents in an area. The simple rule of supply and demand dictates that postcodes with lots of local agents drives competition for your listing. To get your business they are forced to lower their rates. The reverse applies in rural areas, where fewer agents means there is less competition for listings, which typically results in higher commissions.

Let’s take a look at two examples, one in metro Sydney and one in regional Victoria:

    If you sold your property in Randwick for $1.2 million — where the average agent commission rate is currently 1.92% — you would pay your agent a commission of $23,040. This would leave you with $1,176,960 from the sale.

As you can see a small difference of just 0.52% in the agent commision translates to thousands of dollars in difference that you could end up paying your agent following a successful sale.

Now let’s look at real estate agent fees and commission in more detail, starting with the difference between these two separate costs.

Commissions by capital cities

Real estate agent fees and commission in Sydney

Real estate agent fees and commission in Melbourne

Real estate agent fees and commission in Brisbane

Real estate agent commissions calculator

Pay the right commissions and maximise your sale price

Understanding real estate agent fees and commission

The two key agent costs to budget for are their fees and commission.

Generally, real estate agent fees are designed to cover their costs for advertising and marketing your property. Since not all real estate agents include marketing and advertising costs in their commission structure, it’s smart to prepare for these costs separately in your calculations when budgeting for the sale of your property. This can include street signage, online and print advertising as well as flyers and brochures.

There is no such thing as an average real estate fee, rather the recommended budget for advertising and marketing is typically between 0.5% to 1% of your home’s value.

In practical terms, and based on the current median Australian dwelling value of $537,506, you would be spending anywhere from $2,687 to $5,375 on real estate advertising and marketing. This is to ensure enough people see your listing and you get the highest possible price for your property.

The real estate agent commission is a percentage of the sale price in exchange for selling your property. Commission rates aren’t regulated and are actually set by individual agents; therefore, a rate can vary from suburb to suburb and state to state — depending on the agent and state of the local housing market.

The average commission real estate agents charge varies between states, metro and regional areas – and ranges from about 1.6% to 4%. Across the country the average charge is around 2% to 2.5% of the sale price of your home, or from $10,000 to $12,500 when selling a $500,000 house.

Factors that influence the commission rate an agent charges include:

  • If advertising and marketing costs are bundled into their commission structure, or charged separately
  • The type of property, with more unusual properties typically attracting a higher commission
  • The value of your property, where agents are often prepared to charge a smaller commission for a high end property
  • Location, with commissions varying quite widely depending between metro and regional/rural postcodes

Want to know what real estate agents charge where you live? Use our Real Estate Commission Calculator to estimate how much commission you’d be paying on the sale of your property.

We’ve collected the commissions from real estate agents right across Australia to work out the average commission rate for each suburb. Use our commissions calculator to work out what that means in real dollars based on your expected sale price.

Fixed vs. tiered commission

There are two main options when it comes to real estate agent commissions: fixed and tiered.

Fixed commission is the traditional method when it comes to calculating what real estate agents charge. It’s based on the sale price multiplied by the negotiated commission rate.

For example, if you were to sell a home for $800,000 and were charged a commission rate of 1.97% you’d pay $15,760 in commission ($800,000 x 1.97% = $15,760).

A tiered commission rate is based on performance, and is used as a way to encourage real estate agents to get a higher sale price. How? With a higher commission rate above an agreed sale price. This is also known in the trade as a «commission accelerator».

First, you and your agent need to agree on a target sale price (usually close to what you expect your property to sell for). Then, define 2 different commission rates:

  • One if the property sells under the agreed sale price (usually low)
  • One if the property sells above the agreed sale price (usually high)

For example, let’s say you expect a sale price of $830,000. Rather than going for a flat 2.5% commission rate, you could agree on paying a lower rate of 2.0% under $830,000 and a higher rate of 6% on everything above $830,000. This will give the agent a greater incentive to work hard and achieve a price above your expected sale price.

How much commission does a real estate agent make?

As we have seen, real estate agents charge commissions of anywhere from 1.6% to 4% of the sale price of your property, depending on where you live and the forces that influence your local market. Do the math and you would assume that agents are rolling in cash.

The reality is, when an agent works for a principal or real estate agency, they don’t take the whole cut. The commission gets split and shared between the parties, so they actually make less than one would typically think. Add in franchise fees from agencies on top of this, and agents make even less — something to bear in mind when you begin negotiating fees and commission with your real estate agent.

Another factor to consider is the condition of the market. When markets are slower, commission rates tend to be higher as there are less properties to list for sale and it often takes much longer to sell — especially in regional areas. Not only does this mean agents find less business in slower markets, but it also means they have to work harder for you in order to achieve the positive results that come with an active market.

Real estate agent fees and negotiation

What’s important to remember from all this is that commission structures are flexible. In fact, it’s common to negotiate, especially since there is no longer any legal regulation of commission percentages for the real estate industry.

For this reason, it’s important to ask potential agents all about their commission structure when you first interview them, or when you have OpenAgent pre-screen them for you. Then you can compare apples with apples when deciding on the right agent.

Negotiating fees with agents

Once you’ve researched and shortlisted potential agents it’s worth speaking to a few different local agents to see how flexible they are on their fees and commission.

If you want to get the lowest possible commission you will have to fine tune your negotiating skills — and remember that everything is negotiable! With this in mind here are our top tips for negotiating fees and getting the right agent on board.

  1. Ask each agent what their commission is, and don’t be shy – let them know you’ll be comparing them against one another. This way you might be able to get an agent you like more to «price match» against a competitor.
  2. If you want a record price for your house, don’t expect an agent to drop their fee. Record prices require much more work, and you’ll obviously have to pay a premium on it.
  3. Consider asking for a sliding scale rate structure (like the tiered commission discussed earlier). The idea is to incentivise the agent to secure you a better selling price.
  4. Don’t just settle for the agent with the cheapest commission. More often than not you get what you pay for.
  5. To make sure you’re comparing like with like, include the advertising fees in your cost estimates, since they may or may not be included in an agent’s quoted commission.
  6. Don’t forget that if own a high-end or luxury property, you can probably negotiate with the agent on a lower commission rate.
  7. When it comes to negotiations don’t be shy – haggle on all the fees and costs. Of course the agents won’t tell you this, but everything is negotiable.
  8. Lastly, make sure you get all fees and costs in writing from the word go. That way you won’t be left high and dry when it comes to selling time.

Are cheap agents worth it?

It may be tempting to go with the agent who charges a lower commission, but will they be able to get you the best possible sale price?

Newer agents will be looking to get as many listings as possible, so may be prepared to negotiate a lower commission rate with you. Even though they have less experience in your area, you could save thousands by using them to handle your sale.

On the other hand, experienced agents may have sold more properties than a newcomer. Although their commission rate is likely to be higher, they have the know-how to achieve a better sale price for your home and get you more money in your pocket; especially if they have a proven track record of selling above market rate. Hence it’s usually well worth the money to go with an agent who will work hard for you and has a proven sales record of delivering.

Ultimately we think you should pay your agent what they’re worth and focus on their performance and the service they provide, rather than just their fees and commission.

How do you know if an agent is any good?

It can be tricky choosing a real estate agent. How do you know they are any good?

Their sales track record is a great indication of their ability. Ideally look for a local agent who has sold properties similar to yours. Some agents are great at selling one type of property and make it their speciality. Others are more flexible and understand the local market really well.

Sometimes, it is not so much about what an agent charges you, but more about what it could cost you if you get the wrong agent to sell what is your most valuable possession.

You can also use our platform to research agents and produce a tailored agent shortlist. Our unbiased agent selection uses millions of data points to find agents with experience selling properties just like yours. This includes support on hand, when you need it — like recommending additional agents or advice on how to negotiate commissions.

Agent fees resource centre

Are real estate agent fees negotiable?

When you compare real estate agents, you will find a possibly bewildering range of commissions.

What services are included in real estate.

When you choose a real estate agent, you know you will pay them a commission and fees. What.

Getting over the commission hurdle

Agreeing on what to pay your real estate agent is one of the first tricky hurdles you will.

What commission rates to expect when selling.

When it comes to selling property, ensuring you get an agent who is both capable and charges.

Why we like tiered commission rates

One of the most common questions we are asked by our clients is: “what rate of commission.

Help me find an agent

OpenAgent makes it easy to find that needle in a haystack and come up with the most qualified agent for your home.

Help me find an agent

Marketing and advertising fees and costs

Not sure where exactly all your money is going when it comes to real estate agents fees?

Fees vary from state to state and also from agency to agency, but the bulk of these go toward marketing and advertising your property, specifically:

  • Real estate photography
  • Creating a property floor plan and listing description
  • A ‘For sale’ signboard
  • Open inspection brochures
  • An online property listing
  • A print property listing
  • Auctioneers fees, if you choose this sale option

When selling your home, it’s a good idea to ask your agent for a breakdown of the costs for your property marketing plan. Each agency may have its own special deals with suppliers such as photographers, copywriters and different advertising websites.

Like agent commissions, advertising costs are also not set in stone and can sometimes be negotiated with the agent. In addition, it is possible to pay for your marketing costs as they are incurred or to ask to have them built into the agent’s fee, which doesn’t need to be paid until the property is sold. However, it’s important to keep in mind that you’re required to pay these costs whether or not your property sells.

Tax implications of selling property

The saying that ‘nothing in this world is certain, except death and taxes’, has.

Home loan and mortgage exit fees when buying.

When you purchase a home, you pay a mortgage to a lender. What you may not know is that home.

Help me find an agent

Need help finding an agent to sell your home? OpenAgent compare local agent sales and thousands of reviews to help you find the best agent.

Help me find an agent

Additional fees and costs to budget for

Here are some final tips on costs you’ll need to factor in, to help you budget and choose the right real estate agent to sell your property. It’s a good idea to understand all of these potential costs so there are no nasty surprises as you go!

Unconditional commission

It’s common for a real estate contract to state that the commission payable is unconditional once the sale is complete, which is when contracts have been exchanged. This means that you will be liable for the commission even if the sale falls through prior to settlement, so it’s recommended that the buyer’s deposit is at least the figure of your agent’s commission so you don’t end up out of pocket.

You should also have your solicitor review all agent contracts prior to signing to ensure the clauses stated are reasonable.

A GST figure of 10% is required for all real estate transactions, and this will be in addition to any real estate agent commission charged.

Auctioneer fees

Selling your property at auction requires paying an auctioneer’s fee. Because most real estate agents are not registered auctioneers, this cost is most often considered as separate to your real estate agent’s fees.

Pre-sale repairs and renovations

Even if you’re not planning on doing major renovations before you sell, you should put aside some of your budget for small touch-ups and pre-sale repairs to ensure your property is presented at its best.

Here the focus needs be on cost effective, cosmetic jobs that have a big visual impact, but are easy on the wallet. You should also limit any structural works unless they are crucial to help sell the property.

Some popular and effective pre-sale repairs and renovations include:

  • Painting indoors and out, as well as trims
  • Changing door/cupboard handles and taps
  • Mowing the lawn and tidying up your garden
  • Upgrading or replacing flooring
  • Cleaning guttering and downpipes
  • High pressure washing driveways, paving and paths

All this can help to impress potential buyers and get the sale price you want.

Renovation cost guides

2020 How much does a budget kitchen renovation.

For most families, the kitchen is the heart of the home and where they spend much of their.

How much do pre-sale repairs and renovations.

If you’re preparing to sell your home and want to sell it quickly and boost its sale price.

2020 How much does landscaping and gardening.

Landscaping and gardening can be two of the most cost-effective ways to add value to your.

How much does a bathroom renovation cost.

Whether you’re looking to spruce up your forever home, increase your rental return on an investment.

How much does house painting cost?

When you’re looking to refresh or update your home, especially before putting it on the market.

How much does a home stager cost in 2020?

Not sure if home staging or styling is right for you? Staging a house for sale has been rising.

Easy and cheap ways to renovate your property.

Upcoming house inspection or auction? One of the most common pieces of advice heard within.

Help me find an agent

OpenAgent makes it easy to find that needle in a haystack and come up with the most qualified agent for your home.

Help me find an agent

Other selling costs to consider

In addition to the fees an agent might charge you, there are a few other costs in selling your home that you need to be aware of.

Conveyancer or solicitor fees

There is a lot of paperwork involved in a property transaction, so don’t forget to budget for conveyancer’s or solicitors fees.

Mortgage discharge fees

If you are discharging your current mortgage there is likely to be a cost associated with this.

Bills, rates and taxes

Don’t forget to budget for all the outstanding bills, rates and taxes after you settle — some of which will come through weeks after you have moved out.

Hidden costs

There are also a whole host of ‘hidden’ pre and post sale costs you may not have even thought of. These include home staging, house cleaning, removalists fees and any repairs and renovations to get the property looking its best.


Once you sell your home you naturally have to move out, so you should always include the cost of moving all your furniture and belongings into your budget.

How much does moving cost in 2020?

When you sell a house, moving can be one of those hidden costs of selling you forget to think.

2020 How much does pest control cost?

It doesn’t matter if you’re buying or selling a home; if your home has pests.

How much does an auctioneer cost in 2020?

Are you selling your house or investment property and wondering ‘how much does an auction cost’? A.

What is the cost of selling a house in 2021?

Most of us are aware that selling a house costs money. Sometimes we aren’t aware of how much.

Home loan and mortgage exit fees when buying.

When you purchase a home, you pay a mortgage to a lender. What you may not know is that home.

How much does a building inspection cost?

You’ve found the perfect home to renovate. It’s in the right location. All it seems to need.

The hidden costs of selling your home

Your home is likely to be your biggest asset, so it pays to invest in getting the best possible.

How much does a home stager cost in 2020?

Not sure if home staging or styling is right for you? Staging a house for sale has been rising.

How much does move out cleaning cost?

The end of a lease can be a stressful time. Because you definitely don’t want to lose.

How much does a conveyancer cost?

If you are buying or selling a property, you’ll need to satisfy a range of legal requirements.

Conveyancing: what is it and why do you need.

When buying or selling a home, it’s recommended that you engage a conveyancer. Buying and.

Ready to find a real estate agent?

Ready to find agents and crunch the numbers? It takes just two minutes to search, analyse and compare real estate agents online with OpenAgent.

Don’t worry, OpenAgent can do all the tricky homework for you. A free service we offer is to pre-screen shortlisted agents for you. We’ll then pass on the relevant information to you to help you narrow down your options as simply as possible.

You can also refine your search by using our SmartSearch tool, which uses your answers to questions to intelligently match your needs to the most suitable agents.

If you’re ready to find a local real estate agent, let our team help. You can either compare agents here online or call us on 13 24 34. Our team is standing by to help!

Sign up to our newsletter

  • Ⓒ 2022
  • Ⓒ 2022

*The number of 2 million Australians is based on the number of users visiting OpenAgent according to Google Analytics for the period of 01/08/2019 to 31/07/2020.

#The claim of #1 Agent comparison site is made based on data from Similar Web which shows more visits to OpenAgent than other agent comparison websites for the period of 1/7/2018 to 31/12/2019.

^Note: When a property is sold, the successful real estate agent pays OpenAgent a referral fee, which is at a standard industry rate of 20% of the agent’s commission. It enables us to offer our services at completely no cost to the homeowner. Some agents pay us an ongoing retainer or fixed fee for the services we provide. To be eligible for our retainer product, they must satisfy certain benchmarks and then maintain the highest level of quality. This is measured through user feedback, quantity of sales and other proprietary data.

^^ Note: As a result of COVID-19 where possible we have updated our agent selection algorithm to refer vendors to agents who have confirmed to us that they have social distancing measures in place to ensure our customers’ health and safety. A vendor will be advised when one of these agents has been recommended, and will still be able to see the full list of recommendations at any time. It is our intention to eventually confirm that all agents in our recommendation list meet these standards, however, to date — we have only confirmed this with the agents on our retained product who we work closest with. This will mean those agents are likely to be referred first.