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Real Estate Commission. Flat Fee or Percentage?

Commission: Some agents claim that charging a percentage is a great incentive for the agent to work harder to negotiate a higher price. But the actual incentive is quite small in comparison to the benefit to an owner. For example: A home listed at $600,000 attracts an offer of $590,000, but the owner was hoping for more, let’s say another $5,000. With an average commission of 2.5%, which is often split at around 50% to the office, that means at $590,000 the agent would receive gross $7,375. If the agent manages to negotiate the extra amount, he/she would receive around $40 extra after gst and tax – hardly a big incentive to negotiate hard and possibly risk delaying or even losing their commission.


Flat Fee: A flat-fee agent undertakes the same tasks as a commission-based agent but charges a predetermined amount, often resulting in substantial savings. This upfront fixed pricing offers transparency from the outset. At Smart Home Sales we take this transparency a further step and include marketing costs in the advertised flat fee. This means that sellers know exactly the cost to sell without any hidden or extra costs and can budget accordingly.

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