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What commission should I be prepared to pay an estate agent on the sale of my property? In other words, what is the rate they ask for, and the rate I should try to negotiate?

By Nicole Attridge 20/02/2012, 10:29
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    Sue Grant

    Sue Grant

    They ask for 8% which quite frankly is ludicrous. I would be prepared to pay 8% if they got the price they suggest you go to market with when pitching for the stock. I have always negotiated a scale. Every R100k below the asking price they earn a % less. 3% on properties over R1.5m is still a great little earner in this market and if they price right and market well they can sell in the first fortnight.

    20/02/2012 | 14:08h
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    Marcus Grove

    Marcus Grove

    The normal rate of commission is around 7 - 7.5% of the gross purchase price. BUT you can negotiate. If they don't want to move on to another agency.

    20/02/2012 | 14:18h
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    Lee Ingram

    Lee Ingram

    7% / 8% might seem a lot but bear in mind the agent doesn't get the full 7% / 8% of the commission (unless they're operating independently which is very rare). Usually that 8% is split 50% (or thereabout) with the franchisor / owner of the agency.

    20/02/2012 | 14:53h
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    Marcus Grove

    Marcus Grove

    You can still negotiate! Tough times we live in. We all have to save money where we can :)

    20/02/2012 | 15:58h
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    Sue Grant

    Sue Grant

    An average agent should be moving 2/3 properties a month or their principal will not be impressed and they may lose their territory. It's a tough game. 3 houses sold at R750k each sharing 50% with your principal would still leave the agent with R33750 at 3% commission.

    21/02/2012 | 09:13h
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    Lee Ingram

    Lee Ingram

    I'm not sure I agree that the average agent is moving 2/3 properties a month at the moment (or over the last few years in fact). An agent is lucky if the average 1 property a month. Licensed agents in SA dropped off from about 80,000 in 2005/6 to around 23,000 at the end last year. If it was that easy to make money being an agent then I doubt this would've happened. A commission of 7% / 8% is justified in my opinion.

    21/02/2012 | 15:41h
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    Nicole Attridge

    Nicole Attridge

    I'm meeting with my prospective agent next week. We'll have to see how good my negotiating skills are :)

    22/02/2012 | 17:20h
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