What is a fair real estate commission for selling your property?

What Is a Fair Real Estate Commission for Selling Your Property?

When it comes time to sell your home, one of the most common questions sellers ask is:

“What is a fair real estate commission?”

It’s an important question — and the answer can depend on several factors, including location, property type, and the level of service your agent provides. Understanding how commissions work can help you choose the right agent and get the best value for your money.

What Is a Real Estate Commission?

A real estate commission is the fee paid to your agent for selling your property.
It’s usually calculated as a percentage of the final sale price and is typically paid at settlement.

For example, if your property sells for $800,000 and your agent’s commission is 2%, the total commission would be $16,000 (plus GST).

How Commissions Are Structured

There are two main types of commission structures used in Australia:

1. Fixed Commission
   A set percentage or dollar amount agreed upon in advance, regardless of the final sale price.
   Example: 2% of the sale price.

2. Tiered (Incentive-Based) Commission
   A sliding scale that rewards the agent for achieving a higher sale price.
   Example: 2% up to $900,000, and 3% for any amount above $900,000.
   This structure encourages your agent to push for a premium result.

The Benefits of Fair Commission Selling with an Independent Real Estate Agency vs a Franchise Brand

When you’re ready to sell your property, one of the first decisions you’ll make is choosing the right real estate agency. Many sellers automatically gravitate toward large franchise brands — but independent agencies often offer distinct advantages that can make a real difference to your selling experience and final result.

Independent agencies are typically owner-operated, meaning the person you meet is directly responsible for your sale — not a junior or assistant passed down the line.

This creates a more personal, transparent, and responsive relationship, where your agent truly understands your goals and tailors their strategy around you, not a corporate playbook.

Franchise offices pay ongoing fees, brand levies, and marketing contributions — costs that can ultimately be passed on to clients through higher commissions.
Independent agencies, with fewer corporate expenses, can often offer more competitive fees while still delivering premium service.

What Does the Commission Cover?

A fair commission should reflect not just the sale itself, but the service, strategy, and expertise your agent provides.
Typically, this includes:

• Professional photography and marketing campaigns

• Listing on major real estate websites

• Open homes and private inspections

• Buyer follow-up and qualification

• Skilled negotiation to achieve the best price

• Contract management and coordination with solicitors

In many cases, your agent also invests significant time and money upfront to market your property before they’re paid a cent — which is why commission should be viewed as a performance-based fee, not just a cost.

What’s Considered “Fair”?

A fair real estate commission isn’t just about choosing the cheapest rate — it’s about getting the best value and outcome.

An agent who charges slightly more but secures $30,000–$50,000 extra on your sale price has already paid for their commission many times over.
A fair arrangement is one where:

• The commission rate aligns with local market averages

• The agent demonstrates clear value through their marketing and strategy

• The structure rewards strong performance

Always ask your agent to explain what’s included, how they plan to market your property, and what differentiates their service from others.

Can You Negotiate the Commission?

Yes — commissions are negotiable.
However, rather than focusing solely on price, consider negotiating based on results.
For example, you might agree to a lower base rate and a higher bonus for exceeding a target sale price.
This keeps your agent motivated and aligns your interests perfectly.

The Bottom Line

A “fair” real estate commission is one that reflects your agent’s effort, market knowledge, and commitment to getting the best possible result.
Choosing the right agent should be based on trust, proven results, and the value they deliver — not just the percentage on paper.

At Yes Property Agents, we believe in transparency and performance.
We tailor our commission structure to suit your goals and ensure you get the maximum return from your sale.

If you’re thinking about selling, speak with our team today for a clear breakdown of costs, strategies, and how we can help you achieve the best result for your property.

Average real estate commission and marketing costs

← Mobile/tablet users, scroll sideways to view full table →

Source: OpenAgent.com.au (29/05/24)

Flat Fee vs. Percentage-Based Commissions

Commissions are commonly percentage-based, but some agents offer flat fees.

• Percentage-Based Commissions adjust with the selling price, providing potential alignment with the agent’s motivation to secure the best deal.
• Flat Fee Commissions provide cost predictability regardless of the final selling price. This can be advantageous for high-value properties where a percentage fee might be excessive.

Factors to Consider

• Market Conditions: In a hot market, agents might be more willing to negotiate lower commissions due to the higher likelihood of quick sales.
• Agent Services: Higher commissions often come with more comprehensive services, such as extensive marketing, professional photography, staging, open houses, and more.
• Agent Experience: More experienced agents or those with specialised knowledge might charge higher rates but could offer better service and results.

Additional Costs

• Closing Costs: In addition to the real estate commission, sellers should also be aware of other closing costs, which can include legal fees, taxes, title insurance, and more. These can vary significantly depending on the location and the specifics of the sale.

Conclusion

When considering what you should be paying in real estate commission, it’s essential to evaluate the level of service you require, the condition of the market, and the reputation and experience of the agent. It’s also beneficial to shop around and compare offers from different agents to find the best deal that meets your needs.

Here are some selling tips to get your started

Just because an agent may promise you a higher sale price, doesn’t necessarily mean it is achievable.

If you’re ready to learn more about Buying a Residential Property with a Lease Attached, contact us today to learn more about how we can help you find the property you need