How Buyer's Agents Get Paid in Australia (And What That Means for You)

You pay buyer's agents in Australia - the buyer - not by the seller. Their fee is separate from the property's purchase price.

There are two main fee structures: flat fees and percentage-based fees. Here's how they work.

Flat Fee Structure

Some buyer's agents charge a fixed dollar amount regardless of the property's purchase price.

For example:

• $10,000 flat fee for properties up to $1 million

• $15,000 flat fee for properties up to $2 million

• $20,000 flat fee for properties above $2 million

The advantage of a flat fee is its predictability. You know what you're paying upfront.

The disadvantage is that it doesn't scale with the complexity of the search. A $600,000 apartment search might be simpler than a $900,000 house search, but the fee is the same.

Percentage-Based Fee Structure

Other buyer's agents charge a percentage of the purchase price.

Common structures:

• 1.5-2.5% of the purchase price

• Tiered percentage (e.g., 2% on the first $1 million, 1.5% on the remainder)

For example, on a $1 million property:

• 2% fee = $20,000

• 1.5% fee = $15,000

The advantage of a percentage-based fee is that it scales with the price point and complexity of the search.

The disadvantage is that it creates a potential conflict of interest. If the buyer's agent earns more when you pay more, are they really incentivised to negotiate the lowest price?

Good buyer's agents mitigate this by capping the fee, setting a fixed percentage upfront, and maintaining a fiduciary duty to act in your best interests.

What's Included in the Fee?

A buyer's agent fee typically includes:

• Property search (on-market, off-market, pre-market)

• Property assessment and valuation

• Coordination of due diligence (building and pest inspections, strata reports, contract review)

• Negotiation and offer management

• Purchase process management through to settlement

What's usually not included:

• Building and pest inspection fees (you pay these separately, typically $500-$1,000)

• Strata reports (if applicable, typically $200-$400)

• Conveyancing or legal fees (you pay your conveyancer or solicitor separately)

• Mortgage broker fees (if you use one)

Always confirm what's included in the fee before you sign the service agreement.

When Do You Pay?

Payment timing varies:

Upfront - some buyer's agents require full payment before they start the search.

At settlement, others charge the fee when the property purchase settles.

Split - some charge a partial upfront fee (e.g., 50%) and the remainder at settlement.

If you don't end up buying a property, the refund policy depends on the service agreement. Some buyer's agents offer partial refunds if the search doesn't result in a purchase. Others don't.

Read the service agreement carefully and clarify the payment terms before you sign.

Do Buyer's Agents Receive Kickbacks from Selling Agents?

No - not legally.

In NSW, buyer's agents are prohibited from receiving commissions or referral fees from selling agents. Doing so would create a conflict of interest and violate their fiduciary duty to you.

If a buyer's agent is receiving payments from selling agents, they're breaching their licensing obligations, and you should report them to NSW Fair Trading.

Are Buyer's Agent Fees Negotiable?

Sometimes - but not always.

Some buyer's agents have fixed fee structures and won't negotiate. Others will adjust the fee based on the complexity of your brief, the timeline, or whether you're a repeat client.

It doesn't hurt to ask, but don't expect a significant discount unless you're buying multiple properties or referring other clients.

Is the Fee Tax Deductible?

If you're buying an investment property, the buyer's agent's fee is generally tax-deductible as a cost of acquiring the property.

If you're buying your primary residence (PPOR), the fee is not tax-deductible.

Check with your accountant for specific advice on your situation.

The Practical Takeaway

Buyer's agents in Australia are paid by you, either as a flat fee or a percentage of the purchase price.

The fee typically includes search, assessment, due diligence coordination, and negotiation. It doesn't include building and pest inspections, strata reports, or conveyancing fees.

Payment timing varies - some charge upfront, some at settlement, some split.

If you're considering hiring a buyer's agent in Wollongong, ask for a clear fee breakdown and payment terms before you sign the service agreement.

If you want to talk through whether a buyer's agent is worth the cost for your situation, book a call.