Why Australian Sellers Should Question Paying More Than 1% Real Estate Commission

For many years, high real estate commissions were simply accepted as part of selling property in Australia.

Most homeowners never questioned paying:

• 2%

• 2.5%

• sometimes even 3% or more

plus advertising costs.

But today, more sellers are beginning to ask an important question:

Why are commission percentages still so high when property prices — and agent earnings — have already increased dramatically?

As Australia’s property market has grown over the past decade, the amount agents earn from percentage-based commissions has risen enormously, often without a corresponding increase in the actual work involved.

This is one of the main reasons more homeowners are now turning toward flat fee and lower-commission alternatives.

Property Prices Have Changed Everything

The Australian property market has experienced extraordinary growth over recent years.

Homes that once sold for:

• $350,000

• $500,000

• $700,000

are now commonly worth:

• $800,000

• $1 million

• $1.5 million or more.

While this has benefited homeowners, it has also dramatically increased traditional real estate commission earnings.

For example:

Ten Years Ago

A 2.5% commission on a $400,000 home:

= $10,000

Today

The same percentage on a $1 million home:

= $25,000

Yet in many cases:

• properties are marketed online instead of newspapers

• buyers find listings themselves through property portals

• digital systems automate much of the process

• sellers are more informed and involved than ever before.

This has led many homeowners to question whether traditional commission structures still represent fair value.

The Internet Changed Property Selling Forever

Years ago, agents controlled access to buyers through:

• newspaper advertising

• office databases

• agency shopfronts

• printed brochures.

Today, buyers search online.

The vast majority of purchasers now find properties through:

• realestate.com.au

• Domain

• social media

• online alerts

• mobile apps.

In reality, premium online advertising often plays a much larger role in generating enquiry than the agency brand itself.

This has fundamentally changed the industry.

Should Selling a More Expensive Home Automatically Cost More?

This is one of the biggest questions sellers are now asking.

If two homes take similar effort to market and sell, why should one cost dramatically more simply because property prices have increased?

For example:

• a home selling for $600,000 at 2.5% commission

= $15,000

while:

• a home selling for $1.5 million at 2.5%

= $37,500.

Did the workload really increase by over $22,000?

Many sellers would argue the answer is no.

In fact, modern technology has often made selling easier, faster and more automated than ever before.

Why 1% Commission Makes More Sense

As the market evolves, many sellers now believe commission should reflect:

• actual service provided

• marketing quality

• negotiation skill

• value delivered

rather than simply rising property prices.

A 1% commission structure can still provide:

• strong motivation

• professional service

• premium marketing

• skilled negotiation

while allowing sellers to retain far more of their hard-earned equity.

For example:

Sale Price	2.5% Commission	1% Commission	Seller Savings
$700,000	$17,500	$7,000	$10,500
$1,000,000	$25,000	$10,000	$15,000
$1,500,000	$37,500	$15,000	$22,500

For many families, these savings are substantial.

Sellers Are More Involved Than Ever

Another major industry shift is that homeowners themselves are increasingly involved in the selling process.

Many sellers now:

• communicate directly with buyers

• conduct inspections

• research market data

• compare advertising performance

• monitor online analytics.

Owners often know their property better than anyone else and buyers frequently appreciate receiving direct answers about:

• the home

• the neighbourhood

• improvements

• lifestyle features.

This does not remove the need for professional support.

However, it does challenge the idea that sellers should automatically pay extremely high commission percentages.

Premium Marketing Still Matters

Lower commission should never mean lower-quality marketing.

In today’s market, premium exposure is critical.

Strong campaigns often include:

• Premier listings on realestate.com.au

• Feature upgrades on Domain

• social media advertising

• database marketing

• professional photography

• skilled negotiation.

The difference is that modern sellers increasingly want:

• premium marketing

without

• excessive commission.

This is one reason flat fee and lower-commission models are growing rapidly throughout Australia.

Buyers Find Properties Online — Not Through Agency Offices

One of the biggest myths remaining in real estate is that buyers primarily come from agency databases.

While databases still have some value, most buyers now actively search online themselves.

They:

• browse listings daily

• set alerts

• compare properties

• monitor new campaigns.

In many cases, the quality of the online campaign matters far more than the logo above the real estate office door.

This has reduced the importance of traditional high-overhead agency models.

Why More Sellers Are Comparing Commission Structures

As cost-of-living pressures increase, many homeowners are becoming more financially conscious when selling.

Sellers are increasingly asking:

• What am I actually paying for?

• Does this commission represent fair value?

• Are there smarter alternatives available?

• Can I still receive premium marketing at a lower cost?

These are reasonable questions.

And the answers are driving significant change across the industry.

The Psychology of High Commission

For decades, sellers were often told:“Higher commission means better service.”

But modern consumers increasingly understand that:

• technology has streamlined marketing

• online portals dominate buyer activity

• premium exposure is available without traditional commission structures.

As a result, many homeowners now focus more on:

• actual marketing quality

• communication

• negotiation skill

• transparency

than simply paying the highest commission percentage.

The Industry Is Evolving

The Australian real estate industry is slowly shifting toward:

• more transparency

• fairer pricing

• flexible service models

• premium digital marketing.

Traditional agencies will always exist, and some sellers will continue to prefer them.

However, growing numbers of homeowners now recognise that paying more than 1% commission is often difficult to justify in the modern online property market.

Especially when:

• premium advertising

• strong negotiation

• professional support

and

• excellent exposure

can still be achieved at significantly lower cost.

Final Thoughts

Australian property prices have risen dramatically over recent years, and traditional percentage-based commission structures have increased agent income substantially as a result.

At the same time, technology has transformed the way property is marketed and sold.

Buyers now search online.Sellers are more informed.Premium advertising drives enquiry.Digital marketing dominates the market.

For many homeowners, this raises an important question:

If modern property marketing can deliver outstanding results without excessive commission, should sellers still be paying more than 1%?

Increasingly, Australian sellers are deciding the answer is no.