Fees and Charges

1. AGENT’S COMMISSION

The Real Estate Industry of Victoria instructs us to advise you that all real estate fees and charges are negotiable. Commission or fees for service are discussed on a case by case basis and tend to be geographically based relative to the anticipated selling price of the property and the time and man hours allocated necessary to achieve the best selling outcome.

There are a number of different ways that commissions can be structured and these different options should be discussed with your agent at the time of listing and the method that is right for you and relative to the type of market conditions prevailing at the time. Below are some examples-:

  • A single percentage rate that is based on the gross selling price of the property i.e. 2.75% of the gross selling price plus GST.
  • A sliding scale. This is where the percentage may increase from an agreed starting point whereby for every additional dollar that the agent might achieve above the agreed figure then the agent receives an additional percentage or an additional set amount.
  • A set figure, regardless of the result. This is where an agreed fee for service is agreed upon as a dollar amount rather than a percentage and remains at that figure regardless of the selling price.

    • 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 vendor and the level of service they require. The commission is there to provide the agent with a reward for doing their job successfully, or an incentive for excellent performance. And remember, the commission is ONLY payable when a sale is negotiated at a figure that is acceptable to you as the vendor.

    A point worth remembering …a good agent will defend his or her fees as their fee for service in the belief that they are worth ever cent of that commission and in their ability to achieve a higher figure for you than their competitors.

    Beware of an agent who reduces their fees because you ask them to! Is the agent going to be as soft with final negotiations on your sale price when their commission amount meant so little to them!! Always check and ask for the agents credentials! Are they a licensed agent? How many years have they been in the industry? How many properties have they sold similar to yours? Will they be handling the sale personally? How many properties have they sold in the last month?

    2. MARKETING COSTS

    This is probably one of the most misunderstood elements of selling a property. Unfortunately, some sellers make the mistake of choosing whichever agent offers to market their property at the lowest cost, rather than the agent who can offer them the best value for their dollar whilst ensuring maximum exposure to the widest range of buyers. After all, the greater the number of buyers, the greater the result will normally be.

    When it comes to the marketing of your own property, it is important to consider a number of different elements of the marketing mix, including:

    • Internet via various different web sites
    • Copywriting to maximize the interest in your property when it is on display
    • Local newspaper advertising (usually via 2 papers for the price of one)
    • Photography, floor plans, sketches.
    • Sign boards and pointer boards (where permissible)
    • Brochures
      • •
    • Magazines. i.e. Real Estate Weekly
    • Window displays in all offices
    • Investor database
    • Existing landlord database
    • Owner corporation database

      • It is a known and recognized fact that a correctly weighted and balanced marketing campaign can achieve for you a faster and improved selling price compared with the alternatives. If the multimillion dollar properties have marketing campaigns in the $10’s of thousands of dollars and find their way into expensive newspapers, glossy magazines and often television then the family home and often your most treasured possession deserves some form of marketing to maximize the selling price. All of the above can have an impact on the overall success of your marketing campaign. That is why it is important to seek the professional, experienced advice of your agent to discuss the most appropriate and cost effective way to market your property.

      Do be advised that the marketing costs can be paid with credit card and will only be invoiced for the work or task actually spent on your behalf by the agent at the time of sale. There will be a pre agreed sum at the beginning of the campaign allocated to the marketing of the property and for example if the property sold in the first week and the photography and for sale board were the only expenses incurred at that point in time….then that is all you will be invoiced for.

      3. CONVEYANCING COSTS

      Conveyancing costs relate to the cost of handling all the necessary legal requirements in transferring the property from your name to that of the buyers. There is also the requirement by law that you provide as the seller a Section 32 or Owners Statement to all prospective buyers of the property before they make any offer to purchase. This document consists of the real property description, title particulars, land dimensions and so on to provide the intending purchaser with the important details relating to the title and transfer of ownership.

      These details are usually handled by a Conveyancer or sometimes a Solicitor on your behalf, who will charge you a fee for preparing these documents and handling the settlement. These fees can vary a great deal depending on who handles it for you and how complex the transaction is. If you have a Conveyancer or Solicitor you have used before, you should be able to obtain a quote for their services over the telephone. Some of the information they may find helpful will include

      • The property details and address
      • The type of title you are transferring, (if you know it)
      • The time frame involved
      • Your planned method of sale, or purchase
      • And the specific work you want them to undertake for you

        • Remember, if you do not know anyone who could handle these matters for you, your agent will be more than happy to refer you to an experienced and caring professional who can supply you with an obligation-free quote.


        Useful Link:
        www.consumer.vic.gov/buying+selling+property