When it comes to selling your property, there are a range of different ways you can choose to sell. The method of sale you choose will influence how much it will cost you to sell your property.
Some costs will be payable upfront and other costs you will pay when the property settles. Make sure you check with the agent what costs are payable straight away or before settlement and what will simply be transferred from your sale funds at settlement.
What costs do you need to budget for?
The main costs you will need to include in your sale budget include:
- Preparing the property (this can be as little as cleaning windows and as much as a full blown renovation)
- Property styling fees
- Building report inspection
- Real Estate Agent commission
- Marketing and advertising costs
- Conveyancing fees
- Removalist cost
How much do you need to budget to prepare the property?
This is a challenging question to answer as it really depends on the property and which buyer you are trying to appeal to.
If you are selling the property to a developer or want appeal to a renovator, then you likely won’t need to do anything to prepare the property. The purpose is to sell to someone who is going to knock it down, develop or renovate it so doing anything to cosmetically enhance the property will likely be wasted money.
However, if you are selling the property as a renovated turnkey for a first home buyer or upgrader, then you may invest more upfront with the hopes of selling it for a premium price. A newer property that’s been maintained likely won’t need as much work as an older property.
Some vendors like to get a building report before they list the property. This allows them to understand what works may need to be completed to ensure the property is structurally sound with no major or moderate defects which could impact the transaction. It’s also going to depend on the market. At the moment properties that are turn key or provide a “five year plan” for buyers are still remaining buoyant as so vendors are spending that little bit more to make their property presentable. Three years ago, renovators were very strong and so there was less of a need to do so. Comprehending market conditions is critical to understanding how best to approach property presentation.
What property styling fees can you expect to pay?
The cost to stage a property can differ depending on how many rooms there are, the size of the property and whether there is any existing furniture you are planning to use. Basic staging in a small property can cost as little as $1,500 which includes the bare minimum for a six week hire period.
If you have a larger property and require more complex staging or are hiring in better quality furniture and art, then the price will increase accordingly.
Staging prices can range from $2,500 for a small property with basic staging through to $20,000 for a large property.
Entourage Property can organise quotes from reputable property staging companies appropriate to the market you’re selling in ahead of your sale so you can incorporate these prices into your budget.
Will the Real Estate Agent commission be the biggest expense?
One of the biggest expenses will be the commission payable to the Real Estate Agent. Typically, agents will charge a commission based on the overall sale price. Agents commonly charge between 1.6%-3% however this can vary across location (metro vs. regional), agent, the predicted value of your property and how competitive the market is at any point in time.
If you sell your property for $500,000 and the agent is charging 2% then you would be paying them $10,000 in commission.
Some agents may charge a tiered commission, which means they are paid a higher commission percentage if they sell the property for a higher price. The idea is to give them greater incentive to sell the property for a higher price.
If you sell your property for $1,000,000 and are paying 2.2% then you’re up for $22,000 in commission.
Some agents are happy to negotiate their fees and Entourage can assist you with this process to ensure you are paying a competitive price and that you understand where there’s value and what you’re paying.
How much can you expect to pay in marketing and advertising the property?
Some agents include the cost of marketing and advertising in the commission they charge, however more commonly you’ll pay your marketing and advertising cost separately and upfront.
The cost you incur to cover the marketing and advertising can vary depending on what marketing you decide to do. Here are some indicative costs:
|
Expense |
Estimated Cost |
|---|---|
|
Real estate photography and video |
$300 – $1,500 |
|
Property floor plan |
$90 – $370 |
|
Property listing copywriting |
$180 – $300 |
|
‘For Sale’ signboard |
$70 – $300 |
|
Open inspection brochures |
$100 – $200 |
|
Auctioneer |
$0 – $1,200 |
|
Online property listing |
$660 – $10,000 |
|
Print property listing |
$1,000+ |
What if you sell off-market?
If you opt to sell your property off-market, then you should expect to spend less on advertising and marketing as the agent will be leveraging their network of buyers and buyers agents instead of engaging potential buyers online.
Should you pay extra for an auctioneer?
If your agent hires an independent auctioneer, then you will need to pay their fee. Some agents will include the price of an auctioneer within their commission or be auctioneers themselves. We sat down with a professional auctioneer and got their thoughts on the matter. Read the chat here.
What fees will the conveyancer charge?
Conveyancers will charge a fee for their service which can range from $400 – $1,500 for a simple property sale. More complex sales and structures will expect to spend more for their conveyancing/solicitor to complete the transaction.
Calculate how much it will cost to sell your property
You can jump onto the Buy Sell Costs Calculator and input your various costs to calculate what your out of pocket cost will be when selling your property.
Ready to sell your property? Speak to our Vendor Advocacy team today.