The Cost of Hiring a Buyer's Agent in Australia in 2024
Hiring a buyer's agent can be a valuable investment when purchasing a property in Australia. These licensed professionals can assist with various services, including property search, appraisal, negotiation, and auction bidding. However, the cost of their services can vary depending on the location, the specific requirements of the buyer, and the pricing model used by the agent.
Full Service: 1.5% - 3% of the Purchase Price
A full-service package typically includes discussing the buyer's preferences, sourcing properties within their price range, arranging inspections, performing due diligence, negotiating with the real estate agent, and handling all necessary paperwork. In metropolitan areas like Sydney and Melbourne, the average fee ranges from 1.5% to 3% of the purchase price plus GST.
Buyer's Agent Fees by City
- Sydney, NSW: 1.5–3% of the purchase price or a fixed fee of $8,000 – $21,000, with an average of $14,500
- Melbourne, VIC: 1.2% to 2.75% of the purchase price or a fixed fee between $3,500 and $10,500
- Brisbane, QLD: 1–2.7% of the purchase price or a flat fee of $6,000–$18,000
- Perth, WA: 1.8% to 2.5% of the property purchase price or a fixed fee of about $11,000
Appraisal and Negotiation: 0.9% of the Purchase Price
Some buyers only engage a buyer's agent for property appraisal and price negotiation. The agent will inspect the property, compare it to similar recent sales, and suggest a fair market price. They typically charge around 0.9% of the purchase price plus GST for this service
Auction Bidding: $500 Attendance Fee + Success Fee
Buyers who have already found their ideal property may only need a buyer's agent to represent them at the auction. This service usually involves a fixed attendance fee of $500 plus GST and a success fee of $1,000 plus GST
Are Buyer's Agent Fees Tax Deductible?
For property investors, the total cost of using a buyer's agent is tax deductible. This means the fees can increase the cost base of the investment property and reduce the amount paid in capital gains tax upon sale. However, for owner-occupiers, these fees are not tax deductible
Is the Cost Worth It?
The total fee of hiring a buyer's agent may seem high, but if they can negotiate a lower purchase price and the savings exceed their cost, then they more than justify their price tag. An experienced buyer's agent can also save time by doing the legwork of house hunting on the buyer's behalf, regardless of whether they are looking for a family home, relocating interstate, seeking an investment property, or are unsure about the home-buying process
Conclusion
The cost of hiring a buyer's agent in Australia can vary significantly depending on the location, the specific services required, and the pricing model used by the agent. However, if the agent can secure a lower purchase price or save the buyer time and stress, their fees can be a worthwhile investment in the home-buying process.
