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What commission rate do you charge?

What commission rate do you charge?

by Reporter 3 comments

Brendan Wong

Over three fifths of agents charge a commission rate between 2.1 and 3.0 per cent on residential sales, according to a recent survey.

The latest Real Estate Business straw poll found 64.1 per cent of the 523 respondents charged 2.1 to 3.0 per cent, 4.0 per cent higher than the result for the same poll taken three years ago.

Amy Kaslar from LJ Hooker Thornleigh told Real Estate Business while her office fell into that range, commission rates depended on location.

“I was talking to an agent up in Hawks Nest Tea Gardens the other day, and up there they’re about 3.6 per cent, but it’s relative to their price range,” she said.

In a change from the previous poll, the second common rate range was between 1.5 per cent and 2.0 per cent. Three years ago, it was in third place, behind the rate between 3.1 per and 4.0 per cent.

1st Place Realty in Perth currently boasts a commission rate of 1.5 per cent. The agency previously charged a rate of one per cent, until last year.

Licensee Lee Tamblin increased the rate as one per cent was too low in comparison to his competitors, who were charging two to three times more. Another reason was a need to employ more staff members.

Mr Tamblin said very little had changed since the increase.

“We’re selling the same amount, if not slightly more ... For me personally, we’ve sold slightly less, but that's more because I’ve got to look after three other people now. I think it’s been good for us and probably better in terms of our gross profit," he said.

He said many agents in Western Australia, particularly in Rockingham, charged between 3.5 and 3.8 per cent.

“I don’t even understand how anyone would contemplate paying someone four per cent or nearly four per cent to sell a house,” he said.

“Some people equate what you pay for an agent to what you’re going to get from your agent or the service.

“From my point of view, even though we charge sometimes less than half of what these other agents are charging, the service that we provide is slightly better and, in some cases, we get the same dollar figure or more than the other agents would get.”

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What commission rate do you charge?
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Total votes: 209
The voting for this poll has ended on: July 13, 2018
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