{"id":175509,"date":"2023-08-08T13:30:44","date_gmt":"2023-08-08T03:30:44","guid":{"rendered":"https:\/\/propertyupdate.com.au\/?p=175509"},"modified":"2024-02-27T18:28:28","modified_gmt":"2024-02-27T07:28:28","slug":"how-much-do-buyers-agents-charge-in-australia","status":"publish","type":"post","link":"https:\/\/propertyupdate.com.au\/how-much-do-buyers-agents-charge-in-australia\/","title":{"rendered":"How much do buyer\u2019s agents charge in Australia"},"content":{"rendered":"

Buying an investment property can be both an exciting and stressful time.<\/p>\n

Ultimately, choosing the right investment property<\/a> comes down to your investment plan, but also knowing how much you can afford and understanding what is available to buy.<\/p>\n

This is especially the case at a time when property stock is low and prices, although cooled, are significantly higher than pre-pandemic.<\/p>\n

Sometimes it can feel like the whole market, and everyone in the sale process is geared in favour of the seller.<\/p>\n

But that\u2019s where a buyer\u2019s agent can help.<\/p>\n

\"Buyers<\/p>\n

These professionals guide buyers through every step of the property purchasing process, from identifying suitable properties to negotiating prices and closing the deal.<\/p>\n

An experienced buyer\u2019s agent can help to level the playing field and make your property buying experience better.<\/p>\n

However, this expertise comes at a price.<\/p>\n

So here\u2019s a full breakdown of everything you need to know, plus how much you can expect to pay in your state.<\/p>\n

How do buyer\u2019s agents get paid?<\/span><\/h2>\n

The first thing you need to think about when engaging a buyer\u2019s agent is how buyer\u2019s agents get paid, and how much.<\/p>\n\r\n\r\n

<\/div>\n

Put simply, the buyer (you) is the person responsible for paying the buyer\u2019s agent their fee or commission depending on your agreement.<\/p>\n

This can be as one of 3 pricing models:<\/p>\n

    \n
  1. A percentage of the property value<\/li>\n
  2. A tiered fixed rate or,<\/li>\n
  3. A flat fee.<\/li>\n<\/ol>\n

    This payment will be an out-of-pocket expense and cannot be covered by a loan or financing.<\/p>\n

    In some cases, you will find that the buyer's agent will also receive a commission from a developer or builder if the property you're looking to buy is a new development or a piece of land.<\/p>\n

    If that's the case, run away as fast as you can!<\/p>\n

    They are not really acting on your behalf, are they?<\/p>\n

    They represent the builder or developer and are not really a buyer\u2019s agent, even though they may call themselves such.<\/p>\n

    \"Buyers<\/p>\n

    How much does a buyer's advocate cost?<\/span><\/h2>\n

    As mentioned, buyer\u2019s agent fees depend on how they structure their charges and it also depends on the type of service you want - a set fee to attend an auction can start from as little as $500 while a full search and negotiation service could be as much as 3% plus GST.<\/p>\n

    Here\u2019s a breakdown for each fee structure:<\/p>\n

    Percentage of property value<\/h3>\n

    Most professional buyer\u2019s agent fees are set as a percentage of a property value.<\/p>\n

    Under this pricing structure, you would pay a fee based on a percentage of the final purchase price of your investment property, so it varies depending on your budget.<\/p>\n

    And, of course, this is similar to how selling agents get paid.<\/p>\n

    In Australia, a typical buyer\u2019s agent percentage fee would be between 1.7% and 3% + GST depending on what service is provided.<\/p>\n

    So for example, if you were to buy a $500,000 property, the buyer\u2019s advocate cost would be $10,000 for a 2% fee and $15,000 for a 3% fee.<\/p>\n

    If you were to buy a higher price property at, say, around $1 million, those costs would be $20,000 and $30,000 for a 2% and 3% fee respectively.<\/p>\n

    Tiered fixed fee<\/h3>\n

    If a buyer\u2019s agent fees are set using a tiered fixed fee this means that there is a set fee which, like the above, varies depending on the bracket of your property sale price.<\/p>\n

    For example, a buyer\u2019s agent might charge a set fee of $5,000 for properties bought up to $500,000 but then this can jump to $10,000 for properties sold from $500,001 to $1 million, then $15,000 for the next bracket up\u2026 and so on.<\/p>\n

    The benefit of this structure is that, unlike a percentage fee, you know upfront what costs you\u2019re expected to pay.<\/p>\n

    But the negative is that this can be costly if the brackets for each property sale price (and associated fee) are large.<\/p>\n

    For example, if you were to buy a property at $550,000 you\u2019d pay $5,000 more in buyers agents fees than someone who bought one for $500,000.<\/p>\n

    \"Fees\"<\/p>\n

    Flat fee<\/h3>\n

    A flat, or fixed, fee pricing structure means the buyer\u2019s agent will charge you depending on the service that they\u2019re giving, regardless of what the final sale price might be.<\/p>\n

    For example, you will pay one flat fee for a buyer\u2019s agent to bid on a property for you, another higher fee if you wanted them to source the property and more for a full service where everything is included.<\/p>\n

    Not only does a fixed fee differ by service, but it also differs depending on the agent and even your location.<\/p>\n

    Additional costs<\/h3>\n

    While the buyer\u2019s agent fee will cover the bulk of the cost of buying, there are some other costs that you need to take into account such as fees for property assessment reports or due diligence fees.<\/p>\n

    GST will also be added on top of any costs incurred.<\/p>\n

    So whenever engaging with a buyer\u2019s agent it's important to always ask for a full list of all the fees involved so that you\u2019re not caught out.<\/p>\n

    Typical buyer\u2019s agent fee in Sydney<\/span><\/h2>\n

    Sydney buyer's agent<\/a> fees generally range from:<\/p>\n