When selling your home there are several costs and fees that you will need to bear in mind.
If you choose to use a real estate agent to sell your home, the agent’s fees will most likely be your largest expense of selling. There are usually two components to what agents charge for selling a home – the commission and marketing fees.
The commission is usually a percentage that is calculated on the sale price and is paid at settlement.
Agents’ fees are not set by law. While there may be guidelines set by the Real Estate Institutes in each state/territory, you can negotiate with the particular agent regarding any commission or other fees you may be required to pay.
In ACT the commission usually ranges from 2.5% to 4%.
In NSW commission rates usually range from 2% to 3.5%.
In Queensland commission rates are set to a maximum of 5% of the first $18,000 of the sale price and 2.5% of the balance of the sale price.
SA commission rates generally range from 2% to 3%.
VIC commission rates generally range from 1.6% to 3%.
WA commission rates are generally between 3% and 3.25%.
In TAS the Real Estate Institute of Tasmania has set recommended fees however, agents are not bound by them. The fees recommended are as follows and include GST:
Where the purchase price is:
Under $10,00011.04% with a minimum of $100
$10,001 – $50,000$1104 plus 6.02% of excess over $10,000
$50,001 -$100,000$3512 plus 4.22% of excess over $50,000
$100,001 upwards$5523 plus 3.99% of excess over $100,000
You may find that shopping around between agencies delivers you benefits in that you can then choose an agent based on their skills in selling in your particular suburb and balance that off with the commission different agencies require. Boutique agencies may offer more attractive commission charges.
The marketing fees are paid to the agent for advertising your home. They are out of pocket expenses incurred by the agent to place advertisements on web sites and in newspapers, erect signs outside your home and may include auction fees. They are on top of the commission you will pay on the sale. This is usually paid prior to settlement.
A typical budget for marketing is around 1% of the asking price. If you home is marketed for sale at $400,000 you should budget around $4,000 for marketing.
There may also be additional costs involved with marketing and listing your home; for example, in listing your home you may need to obtain a formal valuation.
It is also important to check with your agent whether their fees include open home inspections. It is also wise to bear in mind that even if your agent covers open homes, you may still have costs involved with preparing your home for inspection, such as cleaners, landscaping, repairs or simply flowers and decorative touches inside the home.
Legal fees are another cost of selling your home, but they are a minor expense compared to agents’ fees.
At OzPropertyLaw.com however we offer a competitive fixed price for your conveyance.
We understand that you want certainty about what you will pay for your conveyancing. So we offer an all-inclusive, fixed fee which includes our professional fee, the GST and the searches (disbursements) you must carry out. This is the total amount you will pay for your conveyancing – there are no add-ons unless you ask us to do additional work. For example, you want to do additional searches. Our promise is that you will not receive any nasty surprises at the end of your conveyance.
Our fee is different to most other conveyancing firms. They offer you a fee that is fixed only for their professional fees and which does not include disbursements or searches. If you review their offers carefully you will see that they are not comparable to our all-inclusive, fixed fees as they say plus disbursements or disbursements extra. Those conveyancing firms will then add these additional charges to their professional fees and your final bill will be $300 to $500 more than what they have quoted you. That will not happen with our all-inclusive, fixed fees. We let you know upfront exactly what you are up for.
For a quote for your conveyance head to our website wwww.ozpropertylaw.com now and click the Free Instant Quote tab on the left.
If you have a mortgage on your property there may be fees associated with the discharge of your mortgage or for early termination. These fees and the conditions attached vary between lenders. Discharge of mortgage fees are often in the range of $150-$350 while early termination fees can range into the thousands.
If you are an owner occupier there may also be additional living costs if your sale settles before you are able to find a new home. You may end up paying two mortgages for a short time or needing to rent for a period of time.
Then there are expenses associated with moving such as removalist’s fees, connection of utilities and mail redirection.
Costs associated with investment properties
If you are selling an investment property it is also important to bear in mind capital gains tax. If you have received a financial gain from selling your property, you will be liable to pay capital gains tax. If you are selling your investment property you should also consider other costs associated with selling an investment property, such as loss of rental income.