Where sellers pay the highest fees in the property ‘postcode lottery’ – realestate.com.au

Queensland homeowners pay some of the highest real estate agent commission rates in the country, with new data showing sellers in parts of the state are being charged almost 4 per cent to sell.

A report from agent comparison service bRight Agent found the average commission rate for agents in Queensland was 2.8 per cent, above the national average of 2.65 per cent, based on data from more than 200 postcodes nationwide.

The data showed the highest fees in Queensland were concentrated in regional areas, led by Ingham in Far North Queensland, where the average commission rate was 3.75 per cent.

Other hotspots in Queensland included Gracemere at 3.40 per cent, Kingaroy at 3.35 per cent, Maryborough at 3.25 per cent and Proserpine at 3.20 per cent.

SOLD: $1,455,500, 413 Snooker St, Bracken Ridge

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Across Greater Brisbane, higher figures were recorded in Woodridge at 3.15 per cent, Springwood 2.8 per cent, Goodna 3.05 per cent and Ipswich City, 2.9 per cent.

These rates translated into commissions ranging from $9,937 in Ingham to $28,025 at Airlie Beach.

In Brisbane’s northern and inner suburbs, commission rates were generally lower but still significant, especially when higher local house prices are taken into account.

Bracken Ridge was 2.6 percent or $23,920, Sunnybank 2.52 percent or $36,540, and Coorparoo 2.5 percent – $41,250.

On the Sunshine Coast, Buderim recorded 2.55 per cent, while Trinity Beach in Cairns recorded 2.6 per cent.

SOLD: $1.327 million, 8 Plateau Rd, Springwood

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bRight Agent co-founder Aaron Scott said the report gave homeowners a clearer benchmark to compare rates in their local area and negotiate with more confidence.

“Selling your home is one of the biggest financial decisions you will ever make, but commission rates are still one of the least transparent parts of the process,” Mr Scott said.

“Even a small reduction in commission can put thousands of dollars back in a seller’s pocket, which is especially important when selling under financial pressure.”

The Real Estate Institute of Queensland (REIQ) said there is no standard or recommended commission rate in the state.

REIQ CEO Antonia Mercorella said agents needed to ensure the commission was clearly expressed and that the customer fully understood what the likely amount was and when it was payable.

“Agents can negotiate a commission with their client depending on the value of the property,” says Ms Mercorella.

SOLD: $3.27 million, 61 Sirius St., Coorparoo

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“For example, a higher commission may apply to a lower-end property as it must be viable and commensurate with the time and resources required to sell it.”

Mr Scott said higher commission rates tend to reflect weaker competition between agents in regional and remote areas.

“Our figures show that regional and remote areas pay significantly higher agent commissions than major urban centres,” he said.

“Without strong competition, homeowners cannot shop around as much to get a better rate, and as such they are forced to pay higher prices.”

The report highlighted a disparity between states, with Queensland ranking above New South Wales and Victoria, where average rates were 2.35 per cent, while the ACT was the lowest at 2.23 per cent.

SOLD: $615,000, 11 Madison Rose Dr, Gracemere

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It comes amid anecdotal claims that agents are more likely to discount their fees in a tight market as they compete harder for scarce shares.

But Ms Mercorella said experienced agents should not be expected to reduce their fees or undersell their “expertise, market knowledge and negotiating skills”.

“The old saying, you get what you pay for, applies here,” she said.

“You may pay more commission for the best agent, but that decision could put you in a better position based on the final sales price.”

SOLD: $440,000, 18 Mahoney St, Ingham

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Ms Mercorella said many sellers underestimate the overhead costs associated with running a real estate business.

“Overhead costs can include franchise fees, wages for administrative and support staff, physical office costs, insurance… and marketing for the agency and agents.”

She said compliance requirements also created “hidden costs” for agencies.

“Historically, we have seen a number of low or fixed fee business models come and go because when you factor in the significant overhead costs of running a real estate business, this is not sustainable.”