Real Estate Commission Victoria

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While some of the fees are necessary to be paid while selling a property, other expenses can be negotiable or avoidable.

How much you have to pay in terms of real estate commission depends significantly on the area you live and the agent you choose to handle your real estate. There is no standard fee when it comes to agents, and the same goes for their commission. A real estate commission is an amount that goes from your final sale price of the house to your agent. This is usually paid after the estate is sold. The two main structures of real estate commission are fixed and tiered. In fixed commission, it is calculated based on the price at which the house is sold and the decided percentage of commission with the agent. In contrast, in tiered commission, the agent benefits more for every dollar above the sale price.

What is the average commission paid to real estate agents in Victoria?

You will never find something like a standard commission that every agent should take in Victoria. Like other parts of Australia, the commissions that agents take depend upon the market they are in. However, you are open to negotiating the terms as they are entirely at the agent's discretion. Even if you might not be able to shave off much from the commission rate, knowing an average can save you a lot of money by bringing the agent down just a few points.

The national average of commissions in Australia ranges from 2-2.5%. However, there are significant fluctuations in this rate in the region of Victoria itself.

In Hawthorn, the typical agent commission rate is 1.79% on average. In the Melbourne suburb of St Kilda, which is just a few suburbs away, it is around 2.01%.

In the rural centre of Bendigo, the agent commission rate average is much higher, at 2.44%. The average commission in Victoria is 2.04%, but it can vary greatly based on the suburb.

What factors influence the commission rate?

While it is not uncommon to look for the cheapest option for a real estate agent, it reflects greatly on their skill as an agent. Estate agents who tend to charge more also give your case their due energies.

A good agent might end up adding thousands of dollars to your final sale price in return for more fees.

The real estate market in which the agent works decides the commission rate. A market needs to be competitive to thrive, and an agent offering a higher or lower commission rate than average would suffer.

How do fees and commissions in Victoria compare to the rest of Australia?

The population density of Victoria is the highest in Australia and has the second largest population; the first is NSW. Areas such as Melbourne have seen a lot of growth in population and potential buyers for real estate in the past couple of years.

There are properties with good potential for development, peaking buyer interest. Victoria is home to the least real estate agent commissions in Australia, with the average agent fees just around 2.04%.

In a market where buying and selling opportunities are high, real estate agents have to keep their commissions low to stay in business.

Because of population and growth, Victoria is among the states with the strongest real estate markets. Only two states have a lower average than Victoria in all of Australia. They are SA at 2.00% and New South Wales at 2.02%. Other than these two, all other states range from 2.23% to 2.84%.

How much do real estate agents earn in Victoria?

When you pay a good chunk of your sales money to a real estate agent, you want to believe that it acts as an incentive to them to put effort into your deal. The agency an agent works for influences the commission rate as well. If an estate agent works with an agency, up to 60% of their commission might go to the agency. The amount that remains is further divided between the listing agent and the agent who sold the property. Some agents don't get anything from their commission at all and work for a weekly wage.