REAL ESTATE AGENT COMMISSION FEES FOR SELLING A HOUSE
Below you can see examples of real estate commission and fees based on sale prices, advice about negotiating with agents, how to add value to your sale price and ways to prevent unnecessary expenses.
If you want tailored advice about your property, commission or situation, get in touch with us first. We have been helping Kiwi home sellers for ten years and it's a 100% free, no obligation service.
COMMISSION FEES CHARGED THE SAME REGARDLESS OF COMPETENCIES
Firstly, it is important to know first that real estate commission fees are charged the same whether you use a competent agent with substantial real estate experience or use a newly qualified, inexperienced real estate agent.
So basing your decision on a percentage point of difference can end up costing more than you budgeted for if you get landed with an unsuitable real estate agent.
The last decade that Agent Finder NZ has been helping home sellers, has proven that competent real estate agents who have been vetted is by far the safest way to make such an important financial decision.
Request a shortlist of vetted real estate agents so you can review and compare agents first.
COMPARE REAL ESTATE COMMISSION FEES
The following fees are based on the first $350,000 at either 2.5% or 3..5% and anything over and above $350,000 is based on 2%.
350,000 sale price - 2.5% commission = 8,750 | 3.5% commission = 12,250
450,000 sale price - 2.5% commission = 10,750 | 3.5% commission = 14250
550,000 sale price - 2.5% commission = 12,750 | 3.5% commission = 16,250
650,000 sale price - 2.5% commission = 14,750 | 3.5% commission = 18,250
750,000 sale price - 2.5% commission = 16,750 | 3.5% commission = 20,250
850,000 sale price - 2.5% commission = 18,750 | 3.5% commission = 22,250
950,000 sale price - 2.5% commission = 20,750 | 3.5% commission = 24,250
$1.5M sale price - 2.5% commission = 31,750 | 3.5% commission = 35,250
$2M sale price - 2.5% commission = 41,750 | 3.5% commission = 42,250
QUESTIONS TO ASK REAL ESTATE AGENTS
Once agents have been vetted, we then provide our clients with a comprehensive real estate agent questionnaire to help objectively compare the agents, market appraisals, commission and fees, advertising costs and marketing plans. We place a lot of emphasis on real estate competence and negotiation skills.
As an example, a client recently reported:
The Agent Finder process was very helpful. It was a seamless way for us to compare several real estate agents quickly. Your service took a lot of the legwork and guesswork out of the selling process.
It was particularly helpful since we were in quite a time crunch. The real estate agents we selected were very responsive, provided good information and were comfortable and easy to get along with.
Keep up the good work!
- K Greep
REAL ESTATE COMMISSION FEES ARE NEGOTIABLE
When figuring out how much commission you should pay, it helps to know property agents all vary in their approach to negotiating real estate commission and fees, but we have found real estate agents referred by us are mostly open to negotiating a fair percentage. Some are happy to negotiate a flat fee.
When selling a house, everything is negotiable including commission fees, advertising costs and the term of your agency agreement although some are lead to believe that it is not.
When negotiating commission with a real estate agent, be aware that individual agents receive approximately 50% of the total charged. The remaining 50% goes to the company although senior level real estate agents often receive a higher percentage. Each real estate company has its own structure for this.
Some real estate agents don't have the delegated authority to negotiate or simply refuse to negotiate, however, many are open to negotiating and we can help you with this.
Negotiating commission can be very confronting and the best time to discuss this with a real estate agent is after they have explained to you exactly what you get, for the commission they will charge. They are generally less affronted at this stage and have already invested time into the appraisal process. This is the time when you are more likely to succeed!
WHAT REAL ESTATE COMMISSION & OTHER FEES WILL I HAVE TO PAY FOR?
1. A commission percentage of a sale price, or some agents will negotiate a flat fee for an unconditional sale.
2. Advertising expenses such as internet or real estate magazines (newspaper advertising is not considered necessary but it depends on your location and the cost).
4. Auction fees if that is your chosen method of sale.
5. Administration costs which come out of the real estate commission at the end of the process.
Different real estate companies all have different ways of establishing their commission, costs and fees. Some offer complementary services and some don't. Some companies have strict policies about agents negotiating real estate fees, others are more flexible.
Where needed, there are numerous ways to make savings in each of these cost areas and low-cost ways to help add value to your sale price.
Vetted real estate agents are proven to be the most competent, but don't cost any more than agents that are the least competent.
We can advise you about this. Get In Touch.
WHEN CONSIDERING COMMISSION & FEES, ADD VALUE AND PREVENT WASTEFUL EXPENSES
Before you do anything, start with these 10 tips for paying the lowest real estate fees and expenses - a real money saver. Examples include how to add 10-15% value to your expected sale price and how you can influence more buyer inquiry.
The higher the volume of inquiry, the more likely your real estate agent will be in a position to generate multiple offers. This in turn can influence a higher sale price.
When selling a house, vendors often rely solely on a real estate agent to generate buyer inquiry through a good advertising and marketing campaign. But you too can influence buyer inquiry with your pre-market decisions, most importantly, how you choose your real estate appraiser to conduct the sale for you. Never underestimate the importance of this decision.
If you also understand the six most common reasons properties don't sell, you will be more prepared than other vendors who don't. This is important information to know because selling a house a second time around can become very expensive and often involves reducing the asking sale price.
Agent Finder NZ exists to equip Kiwis to sell their properties. When combined with our impartial advice, tips about commission and all other fees, we have saved clients tens of thousands of dollars.
Understanding the bigger picture will give you a much clearer estimate about how much real estate commission you should pay, along with any other expenses, and how much you will have left from the sale of your property after expenses. We are your advocates so if you need help getting started, Get In Touch.
WHY REAL ESTATE COMMISSION & FEES COST SO MUCH
We have found that vendors most likely to be averse to paying commission:
- are likely to have previously been subjected to poor conduct or a poor standard of real estate practice leaving them dissatisfied
- are in the beginning stages of looking at what real estate services cost, based on a hypothetical sale price
So we delved into real estate fees and commission to find out just how much is absorbed by real estate agents, company overheads and operational expenses.
The real estate commission you pay, goes to the real estate company which pays for business overheads, real estate agent training, supervision and compliance, policies, taxes, indemnity insurance, assets, company marketing and advertising.
In a separate article, we have summarised the responsibilities of real estate agents and companies and why such a high level of competency is needed at both levels. If nothing else, it tells you what to avoid.
BOTTOM LINE INFLUENCED BY AGENT COMPETENCE MORE THAN COMMISSION
It has been well proven that the monetary value of a good sale price by a competent real estate agent, who costs a percentage more, can far outweigh the difference in the commission you were aiming to save, by tens of thousands.
*All figures are to be used as a general guide only and not to be used for specific sales or properties.
We can help you keep your real estate costs to a minimum and help you achieve an optimum sale price. See what other sellers have said.
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