Join Australia's most dynamic and respected property investment community

REA costs for first time sellers

Discussion in 'The Buying & Selling Process' started by Rich W, 26th Feb, 2016.

  1. Rich W

    Rich W Well-Known Member

    Joined:
    16th Feb, 2016
    Posts:
    73
    Location:
    Sydney
    Sorry if this has been asked before however I'm looking to sell my home soon and would like a breakdown on the costs that most estate agents offer/charge. How much is "typical" for advertising and what packages do they offer? Which ones are worth it/not worth it etc. Is there any room to negotiate the costs etc?
     
  2. A Jeremy

    A Jeremy Active Member

    Joined:
    3rd Jul, 2015
    Posts:
    43
    Location:
    Brisbane
    Costs vary between agents as well as the advertising campaigns and the sale type - auction or private treaty. I've sold in the past using a small agency and there were no auctioneer's fees however this is usually not the case with larger, if not most, agencies. From memory, another couple of agencies both quoted me around $1500. A large ad can cost around $400 per listing and for auctions one of these per week for the month prior to the auction can be recommended. You then have signage for the property and any other advertising that you agree to.

    Agent's fees used to be regulated at 2.5% plus GST but now that that isn't enforced some have raised their prices and some have dropped them. It might seem like agents charging less than 2.5% +GST do so purely to gain more work however an agent friend of mine confirmed my suspicion that they need to do this because they aren't as good however I may have just offended some good and honest agents and there are always exceptions to the rule. There are plenty of great agents still charging 2.5% +GST and I don't see the need to opt for someone charging any more.

    Someone please correct me.
     
  3. Big Will

    Big Will Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,546
    Location:
    Melbourne, Australia
    Depends on the price point of your house.

    Typically the advertising will be about $1,500 without any priority placement ads or paper ads.

    You can end up spending $10,000+ with priority placement ads, bigger boards, and full page ads in the paper.

    The agent should be able to give you a number of different packages and the cost break down for each.

    I am a huge fan of the online ads and putting extra dollars there rather than paper advertisement, however if you are targeting older people (70+) then you might want to consider paper.

    As for the REA fees again it depends on the price of the house and the market conditions. The longer the agent takes to sell the property the less money per/hr he actually gets. So in boom time as the property will generally sell quickly they can drop the commission a bit more but if it is really slow they will be less likely to negotiate.

    The other part of the REA commission is the price point, a house that is worth 200,000 they will likely charge 2.5-3% (maybe more) however if you have a 1M+ house they might charge as 'little' as 1%+.

    Good luck with your sale and hope this has been beneficial.
     
  4. Rich W

    Rich W Well-Known Member

    Joined:
    16th Feb, 2016
    Posts:
    73
    Location:
    Sydney
    Thanks for that. So basically my property is probably worth between $850k and $900k, I definitely want online but not priority as such. No newspapers. Just a basic For Sale board out the front. Not sure its worth the glossy printed house info cards they give you at open homes? How much do they cost and are they worth it? Has anyone asked for and how willing are they to throw some advertising in for free and/or knock off some % from the commission? Do they price match etc?
     
  5. Big Will

    Big Will Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,546
    Location:
    Melbourne, Australia
    Don't know the suburb that you are selling in but if there is a lot of properties in the suburb you might want to reconsider doing priority placement of the internet listing, otherwise in some suburbs you can be on page 2-3 on the first day.

    My costing will be a little out dated (been a number of years).

    Brochures A4 Standard (2 Sided) 100units $110.00 (Standard brochure)
    Brochures Premium Gloss Layout 100units $500.00

    BOARDS
    6x4 For Sale Board 6x4 $120.00
    6x4 Descriptive Board/Text only 6x4 $250.00
    6x4 Photo Board 6x4 $275.00
    8x4 Photo Board 8x4 $375.00
    8x6 Photo Board 8x6 $425.00
    8x12 Photo Board 8x12 $900.00

    FLOOR PLANS
    Floor Plan - Standard with site plan 35sqs $125.00
    Floor Plan - Large 35-50sqs $135.00
    Floor Plan - Extra Large over 50sqs $150.00

    SITE PLANS
    Site Plan - up to 800sqm $80.00
    Site Plan - up to 2500sqm $90.00
    Site Plan- Over 2500sqm $100.00

    Copywriting $100.00

    Photography
    Photography basic internal/external day shoot 10 Images $250.00
    Photography basic internal/external night shoot 10 Images $330.00
    Photography pole shoot internal/exteral day shoot 10 Images+ $274.00
    Photography pole shoot internal/exteral night shoot 10 Images+ $342.00
    Window Display Package (Including Digital Screens x 3 offices) $50.00
    Internet x 4 Sites+ Agency website; realestate.com.au; domain.com.au; realestateview.com.au Please note: this cost includes highlight property for 60 days which is $624 of this cost $820.00, priority placement is even higher cant find that cost.

    Internet ranking is Top spot, Priority placement, highlight, standard. So going standard might save you money but for the couple hundred (in the 800,000) in my eyes is well worth the investment.
     
    mcarthur likes this.
  6. Mick Butterfield

    Mick Butterfield Well-Known Member

    Joined:
    15th Jan, 2016
    Posts:
    408
    Location:
    Bermagui NSW
    Hi Rich,

    Like everything, not all agents are equal. The best agent is the one who can put the most money into your bank account at the end of the process. I would focus on questioning the agents on their negotiation styles and tactics. an extra .5% is soon forgotten if the agent can sell the house for $20,000 more.

    With the marketing etc. I feel that a lot of the expense is unnecessary. Definitely no need for print media ie. news papers (huge waste of your money). Again this is just my opinion, others will have theirs.

    Mick.
     
  7. Jacque

    Jacque Buyers Agent and Bookworm, Sydney Business Member

    Joined:
    18th Jun, 2015
    Posts:
    516
    Location:
    Sydney
    Hi Rich

    Selling agents fees will vary, depending on property price (In your price bracket I would anticipate anywhere between 1.8-2.2% standard if Sydney) type of marketing required (different areas=different demographic eg: older people who rely on print vs younger areas who will only search online) signage and auctioneer costs. One thing is clear- there's always room to negotiate and especially if in an area that's heavily competitive. Some agencies have a set package for marketing whilst others include it in their commission cut. Best of luck moving forward with your sale and keep us posted. If you're after recommendations for good agents, let us know where approx you're selling as we may be able to offer a name or two.
     
  8. Esh

    Esh Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    192
    Location:
    Sydney NSW
    If you are in Sydney, the most important would be to spend money on Premier listing on RE($950) and Domain ($412)- although I believe this will be going up in April, different agencies have different pricing though, depending on their contracts with both companies. Paper brochures can be printed instead of the glossy/matte ones
     
  9. Rich W

    Rich W Well-Known Member

    Joined:
    16th Feb, 2016
    Posts:
    73
    Location:
    Sydney
    In your "general" opinions would you go to one of the bigger REA (Ray White, LJ Hooker etc) or one of the smaller boutique agents? Are the bigger boys normally more expensive in general? (more overheads etc?)