There’s a myriad of costs to vendors when selling a house.
From conveyancing costs to agents’ fees and bonuses to marketing expenses, there’s lots to consider.
Campbell Cooney, director and auctioneer at Hodges, one of Melbourne’s oldest real estate agencies, says vendors need to be aware of the costs involved in selling before they put their home on the market.
“The three main costs are conveyancing, marketing and the agent’s fee or commission,” he says.
“When it comes to choosing an agent, a vendor’s decision should never be based purely on the costs placed in front of them.
“As a vendor, you need the best candidate to look out for you in the sale, as they represent you.”
Conveyancing fees
Conveyancing is the process of transferring legal ownership of a property from one person to another and is required in every real estate purchase. It can be done by licensed conveyancers and solicitors.
“We recommend vendors use a local solicitor, as they tend to have local knowledge and are able to recognise if something, like a special condition, might be an issue,” Cooney says.
Vendors should budget between $800 and $2000 for conveyancing.
Marketing costs
The vendor covers the cost of marketing their property.
“An agent will recommend a marketing campaign, which might include a board out the front of the house, listing on realestate.com.au, photography for the listing, the creation of a floor plan, copywriting and press advertising,” Cooney says.
Each listing is unique, Cooney says, and depending on budget, campaigns are adjusted.
In 2020, the average marketing campaign in the Melbourne market costs between $6500 and $8000.
In Sydney, the marketing cost can range between $4500 to $10,000, depending on the property and the advertising schedule, according to Michael Minogue from Laing + Simmons in Woollahra.
Research: How to find an agent.
Agents’ fees and bonuses
There are two types of real estate agent fees, Cooney explains. “There’s a flat fee, where the agent and vendor agree on a fixed fee for the sale of the property, and no matter what it sells for, the fee is set. Then there’s a ‘percentage of sale’ fee, where the agent gets a certain percentage of the final sale price,” he says.
The percentage of sale fee, or ‘commission’, can range from 1% to 3%, but is influenced by a number of factors, such as the property value and the competition for business among agents.
Bonuses are also increasingly being used, he says. “These are effectively incentive bonuses, where the agent and vendor agree on a percentage-based bonus if the property makes above the agreed reserve. It may be, say, 10% of the amount above the reserve,” Cooney explains.
For example, a property expected to sell for $1 million, being sold by an agent on a 1.5% ‘percentage of sale’ fee and 10% ‘bonus’ fee, that goes for $1.1 million, nets the agent $25,000. This is made up of $15,000 for the percentage fee (1.5% of $1 million) plus a bonus $10,000 (10% of the $100,000 above reserve).
All fees should be discussed with the agent before signing.
Lender fees
If you have a mortgage on the current home you’re selling, you’ll need to pay your lender a discharge or early exit fee. Each lender charges their customers a different amount for this service, but it usually falls within the range of $150 and $1500.
Your lender should have their own mortgage discharge forms to fill in, with the entire discharge process usually taking between 14 and 21 days.
2020 Cost of selling a house in Australia – state by state guide
To maximise sale price, many agents recommend professional styling and basic maintenance around the property.
“When a potential buyer walks into a house, they’re thinking to themselves ‘do I love it?’, ‘could I live here?’ and styling is about making the property as appealing as possible, to show off the space and make sure it feels good,” Cooney says.
The cost of styling can range from as much as $6000 to fill and style an empty property, to very little, with good agents offering free advice about ways to declutter a home and make it look great, Cooney says.
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“It doesn’t need to be expensive, but it can make all the difference,” he says.
“Trimming a bush, clearing clutter from a kids’ room, putting junk in storage, borrowing some nice outdoor furniture from a friend to dress a deck … these are all quick and easy and have a big impact.”
Most agents will also recommend completing jobs around the home to improve it for sale.
“Your first question has to be, who are we selling to? If it’s a family home and there’s a rotting window, it needs to be replaced, but if it’s an older house being marketed as a renovator’s delight, you wouldn’t go spending money on weatherboards,” Cooney says.
Such jobs can vary in price, depending on complexity.
Australian Capital Territory
- Agents’ fees: Rates vary in accordance with the property value and the amount of competition for business from other agents, but generally fall within the 1.5 – 3.5% range.
- Marketing costs: The sky’s the limit when it comes to advertising the sale of your property, but the cost of doing so generally ranges between $1,000 and $10,000. Typical expenses include a board out the front of the house, listing on realestate.com.au, photography for the listing, the creation of a floor plan, copywriting and press advertising.
- Conveyancer/solicitor fees: ACT sellers should budget between $800 and $2,200 for conveyancing.
- Lender fees: Selling your home means you’ll need to pay a mortgage discharge fee to release your current lender from mortgage obligations – unless, of course, you own your property outright. This varies from lender to lender, but generally falls within the range of $150 – $1,500.
- Home staging: Styling costs depend on how much new furniture is needed to bring a space up to scratch, and can reach as much as $6,000.
- Auction fees: Choose to sell at auction and you’ll have to pay the auctioneer between $400 and $1,000.
New South Wales
- Agents’ fees: Rates generally fall within the 1.5 – 3.5% range. However, the rate you pay could be more or less than that, as agencies vary their rates depending on a number of different factors.
- Marketing costs: It’s hard to give an exact figure on marketing costs, as sellers take very different approaches. That said, they generally fall between $1,000 and $10,000 in NSW.
- Conveyancer/solicitor fees: Conveyancing costs in NSW range from $800 to $2,200.
- Lender fees: If you have a mortgage on the home you’re selling, you’ll need to pay a mortgage discharge fee. In NSW, this generally costs between $150 and $1,500, with the exact amount depending on your specific lender.
- Home staging: Depending on how well you’ve managed your home’s interiors over the years, you might need to bring in a home stager. In NSW, their services can cost anything up to $6,000.
- Auction fees: A good auctioneer in NSW could set you back as much as $1,000, although some will charge as little as $400.
Northern Territory
- Agents’ fees: Rates vary in accordance with the property value and the amount of competition for business from other agents, but generally fall within the 1.5 – 3.5% range.
- Marketing costs: This one varies a fair bit from one property to the next, but shouldn’t exceed $10,000, and could cost as little as $1,000.
- Conveyancer/solicitor fees: NT sellers should budget between $800 and $2,200 for conveyancing.
- Lender fees: Have a mortgage on the home you’re selling? In NT, your lender will charge you between $150 and $1,500 for a mortgage discharge.
- Home staging: Styling costs depend on how much new furniture is needed to bring a space up to scratch, and can reach as much as $6,000.
- Auction fees: You’ll need to pay an auctioneer between $400 and $1,000, should the sale go under the hammer in NT.
Queensland
- Agents’ fees: Rates generally fall within the 1.5 – 3.5% range. However, the rate you pay could be more or less than that, as agencies vary their rates depending on a number of different factors.
- Marketing costs: It’s hard to give an exact figure on marketing costs, as sellers take very different approaches. That said, they generally fall between $1,000 and $10,000 in QLD.
- Conveyancer/solicitor fees: Conveyancing costs in QLD range from $800 to $2,200.
- Lender fees: If you have a mortgage on the home you’re selling, you’ll need to pay a mortgage discharge fee. In QLD, this generally costs between $150 and $1,500, with the exact amount depending on your specific lender.
- Home staging: Styling costs depend on how much new furniture is needed to bring a space up to scratch, and can reach as much as $6,000.
- Auction fees: An auctioneer will charge between $400 and $1,000 in QLD. Of course, this fee’s irrelevant if you choose to sell via private negotiation.
South Australia
- Agents’ fees: Rates vary in accordance with the property value and the amount of competition for business from other agents, but generally fall within the 1.5 – 3.5% range.
- Marketing costs: This one varies a fair bit from one property to the next, but shouldn’t exceed $10,000 in SA, and could cost as little as $1,000.
- Conveyancer/solicitor fees: SA sellers should budget between $800 and $2,200 for conveyancing.
- Lender fees: Have a mortgage on the home you’re selling? In SA, your lender will charge you between $150 and $1,500 for a mortgage discharge.
- Home staging: Depending on how well you’ve managed your home’s interiors over the years, you might need to bring in a home stager. In SA, their services can cost anything up to $6,000.
- Auction fees: Choose to sell at auction and you’ll have to pay the auctioneer between $400 and $1,000.
Tasmania
- Agents’ fees: Rates generally fall within the 1.5 – 3.5% range. However, the rate you pay could be more or less than that, as agencies vary their rates depending on a number of different factors.
- Marketing costs: It’s hard to give an exact figure on marketing costs, as sellers take very different approaches. That said, they generally fall between $1,000 and $10,000 in TAS, with typical expenses including a board out the front of the house, listing on realestate.com.au, photography for the listing, the creation of a floor plan, copywriting and press advertising.
- Conveyancer/solicitor fees: Conveyancing costs in TAS range from $800 to $2,200.
- Lender fees: If you have a mortgage on the home you’re selling, you’ll need to pay a mortgage discharge fee. In TAS, this generally costs between $150 and $1,500, with the exact amount depending on your specific lender.
- Home staging: Styling costs depend on how much new furniture is needed to bring a space up to scratch, and can reach as much as $6,000.
- Auction fees: A good auctioneer in TAS could set you back as much as $1,000, although some will charge as little as $400.
Victoria
- Agents’ fees:Rates vary in accordance with the property value and the amount of competition for business from other agents, but generally fall within the 1.5 – 3.5% range.
- Marketing costs: This one varies a fair bit from one property to the next, but shouldn’t exceed $10,000, and could cost as little as $1,000.
- Conveyancer/solicitor fees: VIC sellers should budget between $800 and $2,200 for conveyancing.
- Lender fees: If you have a mortgage on the home you’re selling, you’ll need to pay a mortgage discharge fee. In VIC, this generally costs between $150 and $1,500, with the exact amount depending on your specific lender.
- Home staging: Depending on how well you’ve managed your home’s interiors over the years, you might need to bring in a home stager. In VIC, their services can cost anything up to $6,000.
- Auction fees: You’ll need to pay an auctioneer between $400 and $1,000, should the sale go under the hammer in VIC.
Western Australia
- Agents’ fees: Rates generally fall within the 1.5 – 3.5% range. However, the rate you pay could be more or less than that, as agencies vary their rates depending on a number of different factors.
- Marketing costs: It’s hard to give an exact figure on marketing costs, as sellers take very different approaches. That said, they generally fall between $1,000 and $10,000 in TAS, with typical expenses including a board out the front of the house, listing on realestate.com.au, photography for the listing, the creation of a floor plan, copywriting and press advertising.
- Conveyancer/solicitor fees: Conveyancing costs between $800 and $2,200 in WA.
- Lender fees: Have a mortgage on the home you’re selling? In WA, your lender will charge you between $150 and $1,500 for a mortgage discharge.
- Home staging: Styling costs depend on how much new furniture is needed to bring a space up to scratch, and can reach as much as $6,000.
- Auction fees: An auctioneer will charge between $400 and $1,000 in WA. Of course, this fee’s irrelevant if you choose to sell via private negotiation.
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