Everything You Need to Know About Real Estate Commissions

Thursday 2 June 2022, 5:09PM
By Premium SEO NZ

Real estate commissions in NZ can vary depending on the type of property being sold, the location of the property, market conditions at the time of sale, and several other factors. However, there are some general guidelines that can help you understand how real estate commissions work in NZ.

The first thing to keep in mind is that real estate agents typically charge a commission based on a percentage of the final sale price. Commissions in NZ normally range from 2-5% of the sale price of a property. So, for example, if an agent charges a 5% commission and you sell your house for $500,000, the agent would earn $25,000. Also, commissions are usually split between the real estate agent and the agency they work for. 

It's also important to remember that real estate agents are paid by the seller, not the buyer, at the time of sale. This means that if you're selling your home, you'll need to factor in the real estate commission when considering your asking price.

Finally, it's worth noting that although real estate commissions can vary depending on the location and the type of property being sold, they are generally negotiable between the seller and the agent. In some cases, sellers may be able to negotiate a lower commission rate, especially if they are also using the services of a real estate lawyer or another professional. If you're not happy with the commission rate an agent is proposing, don't be afraid to try to negotiate a lower rate. Keep in mind that real estate agents want your business and may be willing to work with you on the commission. However, it is just as important to remember that real estate agents provide an important service, and their fees should be considered when negotiating the final sale price of a property.

Ultimately, real estate commissions are just one of many factors to consider when selling your home, but it's important to be aware of them so that you can make an informed decision about what's best for you.