Selling a Property - Real Estate Agent “Advertisement” Fees WTF?!

SpIcYChIcKeNCuRrY on 05/08/2024 - 07:01

Hi boys and girls,

Looking into selling my property (2BR, 1x toilet, 1x car park) which is an apartment in eastern suburbs of Melbourne.

Rang up several agents to enquire about commission and advert fees. I nearly fell out of my chair when I was told $5800 from not just one but several of these agents.

I asked why is it so damn expensive. I’m not running a tv ad campaign. No one page spread I a. Newspaper.

I was told:

  1. The website changes this amount.
  2. Includes photography
  3. Signage
  4. A floor plan is drawn up etc.

Surely this is not worth $5800?!!!

And does anyone know of an alternative that doesn’t cost as much (no I don’t want to manage this myself)?

Home & Garden

Comments

  • oscargamer on 05/08/2024 - 07:04
    +16

    All agents are going to tell you the same. There is no point in one price beating the competition. They are greedy fxxxs

    • ihbh on 05/08/2024 - 09:20
      +5

      They are greedy fxxxs

      Another way of putting it is that they don't sell enough so this cost recovery/"income" has to spread over a long period (until the next sale).

      There are a couple of agents who sell a lot more, but why would they discount their price? They'd keep it in line with the ones that hardly sell any.

  • EightImmortals on 05/08/2024 - 07:11
    +1

    Do you really need them though? If the market is so hot you could just plonk a for sale sign in the front yard and have the RE agent actually do their job when buyers come to them, that's why you pay them commission after all. FWII extra advertising is optional and not something you have to do if you don't want to. If you are not seeing any interest after a couple of months you could either take up ads then or get a different RE agent. Pretty sure their exclusivity contracts are/were only for 60 days?

  • Muzeeb on 05/08/2024 - 07:15
    +1

    What price did you have in your head initially?

    • Nugs on 05/08/2024 - 08:08
      +3

      tree fiddy
      .

    • Jimothy Wongingtons on 05/08/2024 - 08:20

      Depends, what IS the street value of a half slab of Carlton mid from 1998, and 3 random single darts bummed from the Korean tilers at the local build site these days?

    • DashCam AKA Rolts on 05/08/2024 - 08:59
      +5

      $420.69

  • Jimothy Wongingtons on 05/08/2024 - 07:16
    +14

    You could do what this dude did if you want to diy sale and think you can do it for less than materials and personal time value of $5800

    • Nugs on 05/08/2024 - 08:11
      +1

      gold
      .

  • Dollar General on 05/08/2024 - 08:09

    Seems reasonable

  • Hybroid on 05/08/2024 - 08:10
    +5

    Who did you think pays for those huge outdoor posters with their face plastered over it? Not out of their pocket.

    You can find more info here: https://www.domain.com.au/advice/how-much-does-it-cost-to-se…

  • 87percent on 05/08/2024 - 08:25
    +1

    Recently discovered that my sisters old house was for sale again, and the company that is selling the house, is reusing the same pictures from when my sister sold it nearly 10 years ago

    • coffeeinmyveins on 05/08/2024 - 09:10
      +1

      Yeah they do this unless there's any major changes, even sometimes when there is.

      I visited a rental inspection a few years ago and the pictures were clearly from when the property was first built and was very run down in reality.

      Dodgy bastards.

  • Davo1111 on 05/08/2024 - 08:31
    +1

    Soooo have you done research to find out of it's a good or bad deal?

  • TEER3X on 05/08/2024 - 08:36
    +1

    Australian real estate market is prime for disruption, something that can replace the mostly useless real estate agents.

    In the US you typically have no auctions. You do have a buyer's agent (shows the properties, writes up offers) and a listing agent (helps the seller with the listing and negotiating)

    Houses sold are subject to inspection/finance, and if there are things wrong with the house, the seller fixes them or provides a buyer's credit (to effectively reduce the purchase price).

    • capslock on 05/08/2024 - 08:44
      +3

      Auctions aren't so bad. The level of demand and the prices people are willing to pay is exposed for everyone to see.

      • samyall on 05/08/2024 - 13:48

        Except the reserve which is kept hidden for some reason.

        • TEER3X on 05/08/2024 - 14:30

          As well as the lovely "sales price witheld"

    • MrThing on 05/08/2024 - 09:00

      In the US you typically have no auctions. You do have a buyer's agent (shows the properties, writes up offers) and a listing agent (helps the seller with the listing and negotiating)

      so basically a real estate agent for both parties

      Houses sold are subject to inspection/finance, and if there are things wrong with the house, the seller fixes them or provides a buyer's credit (to effectively reduce the purchase price).

      this can very easily written into a contract or a deposit payment already in australia?

      • TEER3X on 05/08/2024 - 14:27

        Yeah but you're not winning any auctions if you do that.

    • JimmyF on 05/08/2024 - 09:09
      +3

      In the US you typically have no auctions

      Oh Fark no, the US system is even worse as a buyer you have to use an agent, you end up paying both the buyer and seller agents a % fee etc.

      Nope, nope nope!!

      Houses sold are subject to inspection/finance

      Australia has that option, just not when sold via a Auction.

      • TEER3X on 05/08/2024 - 14:29

        The seller pays approx 6% to both sides, whether or not that's ultimately factored into the sale price.

        The US system easily favours favors buyers, maybe not on paper or at first glance, but it's very obvious to see if you've had 1st hand experience in the process.

  • netjock on 05/08/2024 - 08:50

    Ask them for a break down of the website charges.

    Sold a commercial property this year and real commercial was like $3k and once the ad is on there it is there for 1 month.

  • MrThing on 05/08/2024 - 08:59
    +1

    coincidently I got a quote for marketing etc to sell a house over the weekend $5270 in sydney

    so yes your quote is reasonable

    • altomic on 05/08/2024 - 14:20
      +3

      But unreasonable

      • souljah on 05/08/2024 - 15:35

        Reasonably unreasonable

  • coffeeinmyveins on 05/08/2024 - 09:02

    The website changes this amount.

    They will be using a template that cost them $50 on WP and takes about an hour to set up.

    floor plan is drawn up

    An hour of time in whatever tool they use

    Surely this is not worth $5800?!!!

    Worth? no.

    It's the lazy tax. You could always privately list.

  • boomramada on 05/08/2024 - 09:03

    According to Google, the national average is 2% to 2.5% of the sale price of your home. The lowest is around 1.6%. It doesn't matter how they spin it, it will come around that price.
    Some agents charge less commission, but they cover it up with the other fees and some charge increased commission, but less in different costs.

    Agents with a higher client base charge more, meaning they can usually sell your property faster.

    • altomic on 05/08/2024 - 14:21
      +1

      There's an agency in brisbane called "the 1%-ers" , they charge 1.5% commission

      • TEER3X on 05/08/2024 - 14:31

        I like that business model!

  • Shadowsfury on 05/08/2024 - 09:10
    +4

    I just went through this

    It was like $4k just to list on RE.com.au, and another $1500 or so to put it on Domain

    It doesn't matter your type of property but rather your postcode.

    (then on top of that is the other costs like photos, signs etc)

    All up for me was about $7k

    Marketing costs given to you are basically the same across all agencies as they are pretty much "at cost"

    • Benoffie on 05/08/2024 - 09:39

      This.

      RE.com jacked their prices up last year and charge by post code.

      Domain is way cheaper but less traffic.

      Average cost to post on RE.com in a capital city is easily over $2k. It is regardless of property type.

      Add in a sign board, printed material, social media marketing (which accounts for about a third of traffic) and there's the $$$$

  • iforgotmysocks on 05/08/2024 - 09:21
    +1

    Realestate.com.au and Domain charge based on location. So more expensive suburbs are more expensive to advertise.

  • barge-in hunter on 05/08/2024 - 09:27

    My understanding is that RE agents are not allowed to make a profit on advertising - it's passed on at cost.

    HOWEVER, agencies have different contracts/subscriptions to websites like domain and realestate.com.au - so they get different prices, based on what in included. Eg:

    • One agency might get a lower price for the highest tier of advert (that comes up the top of search results) because their subscription mandates that all of their properties will go up at the highest tier. It might even include syndication across social media - and lots of emails sent out to people who are looking at similar properties on said website.
    • Another agency might have to pay full price for the highest tier of advert because their subscription has no restrictions - so they can list unlimited properties, but at the lowest tier (that come up way way down the search results, maybe even starting on page 5). This subscription might not include any syndication to social media and no targeted emails going out?

    I'm not justifying the cost at all as all these website companies make lots of $$$ but - with any form of marketing, you are paying for peoples eyes… and the more relevant those eyes are to your property's sale, the more they will charge. Yes, you could easily create a standalone website for your property - but very few people are going to find it, compared to on one of the country's largest websites dedicated to advertising property.

  • big1964 on 05/08/2024 - 09:29

    I have been quoted $3500 $4100 and $3900 by 3 agents I live in the western suburbs Melbourne, I guess it depends on where you live.

  • Porker on 05/08/2024 - 10:35

    I didn't want to entertain all the commission and other cost-creeping etc. I asked the agent for a fixed fee amount and they quoted $10,000 for a house, which included sale/auction and advertising, but not staging.

    It sounds like a lot but was still cheaper than even 2.5% commission.

    This was in 2022 though.

  • bargaino on 05/08/2024 - 10:49

    (2BR, 1x toilet, 1x car park) which is an apartment

    Do you even need an agent then? Especially if it is part of a larger group, the price should be clear, and a sign out front will inform buyers.
    A settlement agent will sort all the paperwork, and if you have a mortgage, your bank will help.

    Why do Australians think we need an agent for selling, but not for buying? It is just easier for the parasites to get money out of sellers, while buyers are more price-sensitive.

    • capslock on 05/08/2024 - 10:54
      -1

      As a buyer, since I am used to there always being an agent, I would be put off by a seller without an agent, especially for a generic apartment. I would probably just move on to the next apartment.

      • star-ggg on 05/08/2024 - 12:29

        Curious why? What the difference with an agent passing your communications to the owner vs directly communicating with the owner yourself?

      • freefall101 on 05/08/2024 - 13:16

        When I was buying, I couldn't find a single agent who could answer questions about the contract. Any time I had questions it had to go back to some legal team who explained that someone hadn't updated the contract or get told I should just ignore it, it's just legal stuff - which was far less reassuring. If someone was selling without an agent but understood the conditions, I'd perfectly fine.

        The place I bought had a very simple contract done through a small agency, and the only good bit about not having to deal with the seller was was he's a complete knob and no one could stand them (even the agent vented at me about him).

  • Xyzzy on 05/08/2024 - 10:57

    If you're happy to do your own photography, try this mob: https://www.salebyhomeowner.com.au/ to get it listed on the real estate websites, and get a for sale board.

  • pc007 on 05/08/2024 - 11:15

    You can try this

    https://www.propertynow.com.au

    Heard lot of good stories from people about this site.

    • altomic on 05/08/2024 - 13:03
      +1

      A couple around the corner are currently selling their house through that site. House is also listed on realestate.com

  • dogboy on 05/08/2024 - 12:42
    +5

    I read a story in Reddit recently of a guy who wanted to sell his townhouse but the REA fees were ridiculous. So he started attending auctions for places similar to his and then approached the people who bid but did not win the auctions as they were leaving to tell them about his place. Apparently he got told off by a few of the REAs but whatever as he was able to sell directly by using this tactic.

    • Drakesy on 05/08/2024 - 12:44

      Read this too, what a legend.

    • altomic on 05/08/2024 - 13:10
      +1

      My brother did that ~17 years ago. He was selling his inner city melbourne workers cottage. Went to an auction in the next street for the exact same designed cottage, and after the auction approached the people who were the second highest bidder and said "im selling the exact same house for your losing bid" . They all went back to his place and he walked them around, and showed the major renovation he'd done (rewired the house -done by a licensed sparky, new floorboards, replastered, new pipes, etc and the receipts etc. They had some beers and they shook hands on the deal. Couple were happy to get a freshly renovated house for what they wanted to pay. My brother was stoked as he didnt waste money on RE fees.

    • Ghost47 on 05/08/2024 - 13:36

      Let’s make this more common.

  • Drakesy on 05/08/2024 - 12:44

    Could DiY?

  • stuffandthat on 05/08/2024 - 13:16

    Sold my house a coupe of months ago. Advertising fees were $3400 which included the photographs, drone shot, floorplan, sign out the front, ad in the paper, and brochures for those that came through. I thought that was expensive!

    If I was to sell again I'd definitely look in to doing it all myself, with a conveyancer to do the contracts etc.

  • Ghost47 on 05/08/2024 - 13:35
    +2

    Are people starting to realise that the real estate industry are a bunch of crooks?

  • Phattattak on 05/08/2024 - 13:42

    Being married to a (more ethical than most) REA, a lot of that cost would be going to realestate.com.au. Pricing is based on your location which fits into a tier. The eastern suburbs of Melbourne I would hazard a guess would fit into a higher tier and would be driving most of that cost.

    Marketing costs go to those providing the service. A REA (typically) does not see a cent of that. If you put your house of the market, pay said marketing, then pull the property for whatever reason, there is nothing gained by the REA….at all…other than to make it more appealing to buyers which indirectly benefits them through a quicker sale.

    If you want to do it all yourself, then sure……crack out ms paint for a floor plan or pay someone to do it (at the same cost).

  • ATangk on 05/08/2024 - 14:18

    I know a place that charges $1100 or $2500 depending on who you list with. I believe realestate.com charges roughly $2000 so it really depends who you want to list with and why.

    Professional photos + floorplan + signage doesnt need to be more than $1000, so it seems this agent has already factored profit into the price without needing to sell.

  • gromit on 05/08/2024 - 14:38

    That seems a little high, but not obscenely so, we just sold our house, the marketing and advertising including signage, photos, open home and brochures, floor plan etc came to about $4k. Noting prices do vary by region and where you are advertising, for me that was Canberra. Being Canberra nearly half of that $4k was listing on Allhomes.

    also worth noting, usually your bill/quote is itemised, don't be afraid to ask them not to do certain items. e.g. for me that was get rid of the complete waste of paying for drone footage or advertising in certain other sites/papers that have little to no benefit for your area.

  • SkMed on 05/08/2024 - 15:23

    I bought my unit through FB marketplace. I'll definitely just do the same if/when I sell. No real estate involvement whatsoever, not a dollar given to them. RE is as unnecessary as travel agents now.

    • gromit on 05/08/2024 - 15:32

      couldn't disagree more. A "Good" RE is well and truly worth the fees and just listing on FB basically excludes the majority of buyers which is the last thing most people want to do in a property sale. Whether you can find one of the good RE's is another question.

      • SkMed on 05/08/2024 - 15:42

        Well having had nothing but abysmal interactions with RE's my entire life I can vouch for selling via a simple online marketplace as working incredibly favourably for myself and the seller.

        We spoke directly, negotiated a price we were both happy with and taking into account there were savings by not involving the real estate. Minimal fuss, minimal time, minimal cost and within a month or so I had the contract and was in.

        Had the unit appraised recently and was told the price we settled on was right on the money. It's not hard to figure these things out with a tiny bit if research into the market and half a brain cell tbh. Real estate agents should be as irrelevant as travel agents, but they're crooks who knows how to make themselves appear relevant.

        • gromit on 05/08/2024 - 15:51

          The sad reality is in the current market if the buyer is happy with the price and you didn't have multiple bidders then it was probably undervalued. If you have 10 people interested in buying a property then at the end of the day 9 people will think the 10th person paid too much. this is where agents have their value in getting more people together to compete to get the buyer that will pay the most. I easily got value out of my agent, he more than covered his fees many times over with the sale price plus all the help in prepping house for sale.

          • SkMed on 05/08/2024 - 16:04

            @gromit: If you're really wanting to have it listed where more eyes would see it and maximise how much you get rather than basing it on a fair price etc then why not just list it yourself on re/domain etc. By all accounts it's very cheap, quick and easy to get a real estate license (couple weeks, and a few hundred $ if I'm not mistaken). Then simply list your property on domain yourself for a couple $k. This would just about cover everything you're paying the RE to do without their 2%+ commission and over-inflating the cost of advertising etc. the only real value they offer is being able to list on domain/RE.

            However if you're not in a rush to sell and you have a price you've settled on as being fair then I really don't see the value at all in an RE or not using free market places. When I sell I'll simply investigate the market as I did when I bought and base my sale price on that.

            • gromit on 05/08/2024 - 16:11

              @SkMed: when selling a house I don't base it on what is "fair", I base it on the maximum return I can get. To do otherwise is to basically give money away. My buyer actually ended up being someone that didn't look at my house and would not have looked at it except the RE pointed them to while inspecting a different set of properties, They also ended up bidding well over the second highest bidder.

      • SkMed on 05/08/2024 - 15:45

        I'd also add mortgage brokers to the list of being irrelevant too. I got one for said unit and they absolutely screwed the entire thing up, thankfully I'd gotten pre-approval from my bank myself already so just ditched them and did that myself too. It's all MUCH easier and straightforward than most people seem to realise.

        • gromit on 05/08/2024 - 16:01

          for reference I agree with mortgage brokers and travel agents. Property really isn't quite as easy as those though if you are expecting to get the best price.

    • onetwothreefour on 05/08/2024 - 15:32

      Is this still available?

    • garetz on 05/08/2024 - 15:50

      True in a sellers market, however in a buyers market not so much.

  • souljah on 05/08/2024 - 15:40

    Selling property is the transaction equivalent of having a wedding.

    Everyone seems to jack up the prices to get their slice.

  • kaleidoscope on 05/08/2024 - 15:50

    That’s a very cheap quote lol… anyway you can either diy sell or look into it this way. Tell your agent that X is the min amount of money you want after all the fees and commissions paid off. If they say can be done why not let them do their job and save yourself the hassle?

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