Selling through an agent

Selling through an agent

Real estate agents contracted by the seller must act on behalf of the seller but are obliged to act responsibly and ethically to the buyer as well. Anyone in the business of buying, selling or leasing property on behalf of another person must either:

  • hold a real estate agent’s licence
  • be employed and authorised by a licensed estate agent as a registered sales representative.

You can use our licence search to check if an agent is licensed or a sales representative is registered.

If you list your property with an agent, you are engaging the agent to help sell your property. The agent will charge a fee for this service, usually in the form of a commission.

What you can expect from an agent

The agent is bound by professional conduct regulations to:

  • always act in your best interests
  • follow your lawful instructions
  • engage in good estate agency practice.

You can expect the agent to:

  • advise on a method of sale
  • provide a marketing plan, and advertise and market the property
  • advertise an up-to-date price for the property reflecting rejected offers. It is not compulsory for a price to be advertised
  • organise and attend open house and other inspections
  • attract prospective buyers
  • organise and conduct an auction (if you choose this method of sale)
  • arrange the signing of the contract
  • collect and hold the full deposit.

Agents must:

  • at an auction, disclose any bid made by the seller to advance the price of the property
  • communicate to you all verbal and written offers from prospective buyers, unless you instruct otherwise in writing
  • state an estimated selling price in the written authority that does not misrepresent the price at which the agent genuinely believes the property may be sold.

Agents must not:

  • mislead or deceive any party at an auction, make or accept dummy bids or accept any late bids after the fall of the hammer
  • charge you more for advertising or other outgoings than you authorised in writing or they paid for the service.

Choosing an agent

Start by:

  • checking the internet and local papers to find agencies, the services they offer and sale price information
  • speaking to friends about their experiences
  • reading promotional material from a range of agencies including local agents, who are more likely to be familiar with the local market
  • talking to several agents and arranging to meet them
  • checking agents are licensed.

When you meet with agents, discuss:

  • their knowledge of the market in the area
  • comparable local sales
  • their marketing plan for the property
  • their estimated selling price
  • their commission, or how much they will charge
  • the cost of advertising and other outgoings.

Ask the agent to provide quotes for their services in writing.

Do not choose an agent just because they give you the highest estimated selling price.

Get several agents to appraise your property and give you an estimated selling price. Ask them to justify their price by showing you similar properties sold at similar prices in the area.

Take into account the agent’s overall marketing plan when making your decision.

Do not sign anything, including a written authority, unless you are prepared to engage the services of that agent. You do not have a cooling-off period (time to change your mind) after signing a written authority.

Estimated selling price

This is the price the agent estimates your property will attract, based on their experience and knowledge of the market.

The estimated selling price:

  • is not a valuation or a guaranteed selling price
  • does not have to be the same as your reserve price
  • must be recorded in the written authority. This an be either a single amount or a price range.

Price misrepresentation

The practice of deliberately overstating the estimated selling price to get your business is known as overquoting.

It is illegal for an agent to:

  • mislead you about the estimated selling price of your property
  • advertise or advise a prospective buyer of a price that is less than your asking price, or if there is no such price, the agent’s estimated selling price. This is known as underquoting.


Most agents are paid by commission on completion of the sale. An agent cannot claim a commission unless you sign a written authority.

There will be costs associated with marketing and advertising a property, on top of the agent’s commission.

The commission:

  • is not a set amount – you can negotiate the amount with the agent
  • can be paid as either a fixed fee or a percentage of the sale price, or as a combination.
  • must, when agreed, be recorded on the written authority.

Marketing and advertising

Ask for a comprehensive, written marketing plan. This:

  • will be based on the agent’s experience, the nature of the property and your preferences
  • should include advertising methods and costs, and the price or range at which the property will be advertised.

Even if the property fails to sell, you will have to pay for marketing and advertising costs that you have authorised. You can avoid this expense by negotiating a ‘no sale, no fee’ arrangement in the written authority, but make sure there are no hidden charges.

To be clear what you are paying for, ask the agent to provide a written schedule outlining advertising and other outgoings. All expenses are negotiable and must be recorded in the written authority.

Written authority

When you choose the agent, you will be asked to sign a ‘written authority’ appointing that agent. This is a legally binding contract, which sets out all details of your agreement with the agent, including:

  • whether the property is to be sold by private sale or auction
  • the negotiated commission and marketing expenses
  • the circumstances under which commission is payable
  • the authority period or amount of time given to the agency to sell the property.

If the agency is to share commission for the sale, either:

  • the written authority will include a commission-sharing statement
  • you may be given a separate statement before signing the authority, informing of commission-sharing arrangements.

If you want to make any changes after the authority has been signed, they must be made in writing on all copies of the written authority and initialled by both you and the agent.

Authority types

Make sure you understand and agree upon all terms and conditions before signing. These conditions are negotiable. Any changes (deletions, amendments or additions) must be made on the authority and initialled by both parties.

All verbal agreements should be confirmed in writing on the authority and signed by both parties. If you have specific instructions for the agency, attach them to the authority.

Unfair contract terms

The sales authority is a legally binding consumer contract; however there are laws to prevent unfair terms in consumer contracts.

If you believe there is an unfair term in a sales authority, contact the Consumer Protection advice line on 1300 304 054.

European house borers

Real estate agents should inform buyers about european house borers and if a property is in a risk area.  More details are available on the Department of Agriculture and Food website


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