In this article:
Real estate agent commission
Putting time and effort into finding the right agent is vital. Ask for written confirmation of which real estate agent will be handling your job. If your listing passes to a junior agent who has limited negotiation experience, there is less chance of securing the maximum sales price for your home.
The advertising and marketing of your home is usually a separate charge, but some agents include it in their commission or flat-fee.
When comparing agents, get as much detail as possible about these marketing fees so that you can compare apples with apples. For example: will there be a floor plan; a professional copywriter; and where will the listing appear? How visible is the signage outside your home, and will there be social media advertising? Do they have a decent database of prospective buyers to contact?
Aim to agree in writing on a budget, considering your home’s location, your preferences, price point and timeframe. Whether or not the property sells, you’ll still be up for the cost of marketing unless you find an agent who charges on a ‘no sale, no fee’ basis.
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Agree on a fixed rate with your conveyancer and ensure you can see a clear breakdown of their fee structure.
Capital gains tax
Capital gains tax (CGT) kicks in when you sell an asset – your investment property – and you make a profit. The amount you’ll need to pay depends on the property’s sale price and the costs incurred in buying, maintaining and selling the property.
You might be able to avoid or minimise capital gains by living in the property for at least six months after purchase and holding off for more than a year before selling.
- Useful reading: Can You Avoid Capital Gains When You Sell?
- Useful reading: What You Need to Know About Fixed Term Break Costs