The costs of a buyer’s agent explained

When it comes to purchasing your next home, the consequences of buying the wrong property can be expensive and far-reaching.

That's why buyer's agents exist - to help you succeed in your real estate journey and stop you from overpaying or buying the wrong property - potentially saving you thousands in the long run.

Understanding the cost of a buyer's agent only further highlights the value that their service provides.

How much does a buyer's agent cost?

An independent buyer's agent is paid by you, the buyer, and represents your best interests only. The cost of a buyer's agent varies tremendously depending on the service you're after.

For the most common service, which consists of everything from identifying the client's property goals and needs, searching hundreds of properties, attending home opens through to the negotiation and settlement, the cost varies but there is usually an upfront fee and a success fee, which is only payable once the client's property settles.

The fees are similar to what other real estate professionals charge, which may be a flat fee or percentage based. It works out to be a small percentage of the property price.

Where the client has found their own property, the final fees may be lower than if the buyer's agent conducts the search. It depends on what is included and whether the buyer's agent will be conducting due diligence and price assessment or just preparing the contract and negotiating.

Buyer's agents also offer to bid at auction and usually there is a bidding fee, followed by a success fee if the property is purchased. This can also be a flat fee or percentage.

In the scheme of things when you are looking at one of the biggest purchases you will ever make in your life, hiring a professional who not only saves you hours of research but potentially thousands by helping you find your home at the best possible price, really is worth it.

How much money could I save using a buyer's agent?

A buyer's agent is a professional who deals with the selling agent on an equal footing and aims to get you the best price possible.

Importantly, they can save you overpaying for a property that is priced too high or that you might have fallen in love with.

They can save you from making an expensive mistake by buying the wrong property or a property with hidden flaws.

A buyer's agent also saves you time and hassle.

Prospective buyers spend their weekends and evenings searching and attending home opens, which eventually cuts into family and personal time.

Buyer's agents do the hard, time-consuming work and bring the clients properties that suit their needs and budgets, after checking out hundreds of potential buys, so they really save time for the buyer.

Case study

An example of this is Robert and Vicki, clients looking for an investment property to hold for the long term and take advantage of Perth's potential market growth.

Richard and Vicki are pressed for time, running a busy medical practice, having kids at school and their own hobbies and lives to lead.

The buyer's agent was engaged to source property and ensure it was priced right, had no hidden problems, was attractive to tenants and was the right kind of property to meet Robert and Vicki's goals.

The property also had to be low-maintenance and in good condition as Robert and Vicki did not want to be bothered with frequent problems that would cause them stress or take up their time.

The buyer's agent sifted through many available properties that might match the criteria and recommended one in Maylands.

It was low-maintenance, in a desirable location, attractive for tenants and potentially could be bought at the right price.

The client viewed the property with the buyer's agent and felt it was perfect.

After a thorough due diligence checks to confirm there were no hidden problems, the buyer's agent submitted an offer very quickly and secured the property for a good price.

They avoided the competing offers that would have followed in a few days' time and driven prices up.

Building and pest reports were done and the property passed and went onto settlement.

Throughout the process, the client had everything taken care of, wasted no time and had no cause for stress. They bought at a good price, did not overpay and had the peace of mind they were not making a mistake and there were no hidden problems that could come back to bite.

More information

To get the help of a REIWA buyer's agent, refer to this list of REIWA's Buyer's Agent Network Committee members.