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What’s the cost of selling a house?

When it comes to selling your home, there are plenty of things to take into consideration – but there’s one thing that some people tend to overlook: the costs involved.  Let’s take a look at what they are and how you can budget for them. 

Thinking about selling your home? Like most people, you’ll be hoping to make a decent profit from the sale. But have you thought about the costs involved?

Depending on your location and situation, the costs of selling property in Australia isn’t always the same. The fees and commissions you might need to pay can vary based on the state you’re in – and are generally higher in areas like Sydney and Melbourne. There are also voluntary costs you might decide to pay, as well as non-negotiable costs that you’ll need to budget for.

Typically, there are four main costs you'll need to factor in when selling a property:

  • Real estate agent fees or commission
  • Marketing costs
  • Conveyancing fees
  • Capital gains tax (CGT)

Let’s explore what they are – and how you can prepare for them.

Real estate agent fees

Selling property can be a time-consuming and stressful experience – especially if you’re not overly familiar with the process. That’s why most people choose to work with a real estate agent to manage the sale of their home. Your agent will take care of everything. From listing the property and arranging open homes, to generating interest through marketing, as well as negotiating with potential buyers. They’re there to look out for your best interests – and will guide you through the process from start to finish.

There are two main ways agents charge for their service:

  1. Flat fee – the agent and vendor or seller (which is you) agree on a fixed fee that stays the same no matter what the property sells for.
  2. Commission – the agent receives a percentage of the sale price of the home – usually between 1 and 3 per cent. The rate an agent charges can depend on a number of things, including the property value, the agent’s experience and if there was strong competition between agents to take on the job.

You could also choose to use a bonus structure with your real estate agent. Meaning – if your home sells for a higher price than the reserve, you will pay a percentage of the difference between the reserve price and the final sale price to the agent for their work. The main benefit of using a bonus structure? It incentivises your agent to push potential buyers for a higher sale price – a win for both you and the agent.

To save on costs, some sellers choose to sell their property privately without the assistance of a real estate agent. This way might save you some money, but it’s a quite time-consuming (and fairly stressful) process – especially if you’re not across the ins and outs of the requirements. Most people prefer to engage an agent to lean on their experience and make the selling process as stress-free and seamless as possible.

Marketing costs

Marketing your property to potential buyers is an important part of the selling process. It’s how you spread the word and drum up interest about your property.

This is a cost that can vary quite a bit depending on your situation. Each real estate listing is unique, with agents opting to use different marketing strategies to showcase the property to potential buyers. This could include things like signage out the front of the residence, online listings on home sales websites (like or or print ads in the local newspaper.

Marketing costs generally include professional photography or videography, and in some cases, the option of home styling or staging. Home staging involves a professional stylist adding furniture and décor to help make your home look as attractive as possible. After all, you want to present your property in the best possible light to potentially increase the market value of your home.

Conveyancing fees

Conveyancing fees are non-negotiable costs as part of selling your home. These are legal fees paid for the transfer of ownership of a property from one person to another.
There are a number of legal documents that need to be prepared and processed in order to finalise the sale. You’ll need to get a licensed and accredited conveyancer or solicitor to manage this part of the selling process. These fees can be anywhere from $800 to $2,000 – so remember to factor this into your budget.

Lender fees

If you have a mortgage on your current home, you might need to pay lender fees as part of the sale process. There are a few different fees you might need to pay, and these could come in the form of:

These charges depend on your bank – so it’s a good idea to check in with them to see which ones might be relevant to you before you list your property on the market.

If you’re purchasing another property, you may be able to save on these costs by choosing to keep your mortgage with your current lender. You don’t necessarily have to exit your current mortgage just because you’re selling a property. Many home loans give you the option of taking your mortgage with you when you move into your next home – this is known as loan portability or substitution of security.

Loan portability could also be a way for you to speed up the process. Rather than applying for a whole new loan, loan portability lets you transfer your existing loan to your new property - which is generally a faster option. It also helps you avoid some of the upfront costs involved with exiting a home loan and applying for a new one.

In some cases, you might have found your new home, but your current property might still be on the market. A bridging loan could help you see through the period between selling your existing property and getting into your new home. This is a short-term loan (usually up to 12 months) that gives you the option to make repayments only on your existing loan – but once you sell your current property, you’ll need to pay off the interest on your bridging loan. The size of your bridging loan is usually calculated by the amount of equity you have in your current home and your borrowing capacity.

Capital gains tax

When the time comes to sell your property, you will hopefully be selling for a higher price than your original purchase plus transaction costs. If this happens, you’ll have made a capital gain which is subject to capital gains tax (CGT).

You generally won’t pay CGT on capital gains from selling your primary place of residence, but you will if you sell your investment property.

The amount of CGT you’ll pay depends on a few factors, including how long you’ve owned the property, what your marginal tax rate is, and whether you’ve also made any capital losses from other sources that is available to offset your capital gains.

CGT discount of 50% is generally available for individual resident taxpayer who own an asset for 12 months or more. If you sell your investment property before 12 months, you won’t be entitled to the CGT discount. CGT is only applicable on the sale of an asset purchased from 20 September 1985.

As the capital gains calculation can be complex, it is recommended that you consult your tax adviser to ensure your capital gains tax is calculated correctly.

Extra costs

As mentioned, there are a few common costs that most sellers end up paying, but there are also some additional costs that you might want to think about investing in when the time comes to sell your home. Although these costs aren't requirements of the selling process, they could potentially increase the value of your home – so they’re definitely worth considering. These costs include things like:

  • Professional deep cleaning (inside and out)
  • Carpet cleaning
  • Lawn mowing and landscaping
  • General repairs or upgrades to fixtures
  • Renovations

Ready to make your next move?

At the Bank of Melbourne, you’re in good hands – so you can make your next move with confidence. If you have questions about selling your home, let’s talk. Call us on 1300 304 660 or visit your local branch to chat to a Bank of Melbourne home loan expert.

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Credit criteria, fees and charges apply. Based on Bank of Melbourne credit criteria, residential lending is not available for Non-Australian resident borrowers.

This information is general in nature and has been prepared without taking your objectives, needs and overall financial situation into account. For this reason, you should consider the appropriateness of the information to your own circumstances and, if necessary, seek appropriate professional advice.

The taxation position described is a general statement and should only be used as a guide. It does not constitute tax advice and is based on current tax laws and their interpretation.