Everything You Need To Know About Buyer’s Agent Fee

Everything You Need To Know About Buyer's Agent Fee

One thing that scares home buyers away from using a buyer’s agent is the buyer’s agent fee. As a matter of fact, several myths are flying around the real estate market, claiming that buyers’ agents charge a too high commission on every property purchase.

Is that true? Is it wise to use a buyer’s agent when purchasing property? Should property buyers avoid paying an engagement fee? As you read on, you will learn the correct answers to all your questions about the top 10 buyers agents.

What is a buyer’s agent fee?

The buyer’s agent fee is the service charge or commission that a buyer’s agent earns for helping home buyers to find a suitable property in the competitive housing market. Simply put, the buyer’s agent gets the reward for all the resources and effort put into the buying process to secure a property purchase.

Usually, the buyer’s agent discusses the commission method with a prospective buyer before signing the agreement to begin the property search. In some cases, the buyer’s agent may propose a fixed fee (or flat fee) that wouldn’t change regardless of the purchase price. In other cases, the buyers’ agent may request 3% of the purchase price.

Though, property buyers are the ones to pay the buyers’ agent fee. But sellers also pay them due for specific reasons. 

Why do vendors pay the buyers’ agent fee?

Buyer’s agents primarily conduct their searches in the local market. However, they may choose to look for off-market listings in some instances. For example, a home buyer might prefer to buy an off-market property. So, smart sellers can pay buyers’ agents to help them list their properties for prospective buyers. 

Is the buyers’ agent fee worth it?

Indeed, buyer’s agents need to compensate for all the resources and efforts put together to property buyers the right property. So let’s explain if you don’t know what it takes. 

Buyer’s agents provide professional help for home buyers throughout the entire buying process from start to finish. During the purchasing process, they will connect with other licensed professionals such as real estate attorneys, tax advisors, appraisers, home inspectors, title companies, and more to secure a home or investment property. Click here to read more about 5 Reasons Why You Need a Buyers Agency When Buying Property in Brisbane.

That’s not all; a good buyer’s agent will stand as the buyers’ advocate in the face of sales agents to negotiate for the lowest sale price possible. In addition, they will perform the work of a real estate agent to ensure you don’t have issues with auction bidding and inspections. 

Without a buyers’ agent, selling agents will only take advantage of property buyers. Can we say the buyer’s agent commission is worth it? Absolutely. 

What do buyer’s agents do for property investors?

Buyer’s agents play a vital role in the buying process. Whether you are an owner-occupier or a property investor, there is a lot to benefit from the expertise of a buyer’s advocate. We will enumerate them in bullet points.

  • Quick search: Buyer’s agents make property search easy for property buyers. They cover the legwork and deep research required to find the right property. In a nutshell, they help home buyers save time and money during the home hinting phase. Buyers’ agents don’t only make the search easier; they make the entire purchase process faster.
  • Negotiate for the best deal: Buyers’ agents have a rich knowledge of the current market value. With that, they will ensure they bargain for the right price with a selling agent. In addition, an experienced buyer’s agent will stand as a buyers’ advocate during a private sale, ensuring the client gets the most profitable deal.
  • Provide detailed market analysis: Property buyers’ agents understand the current market’s demands. With that local knowledge, they will help you make the right decisions as you navigate the competitive Sydney property market. In addition, buyer’s agents provide professional counsel on how to speculate suitable properties and guide a prospective buyer on the right way to go to find off-market properties.
  • Finalize closure: Buyer’s agents help property buyers schedule and monitor closings.

When does a buyer have to pay the buyer’s agent?

Buyers seldom have to pay agents out of pocket. The buyer’s agency agreement usually includes a provision that the buyer’s agent gets paid adequately, even if the seller refuses the deal. The particular section of the agreement looks like this:

In the agreement, buyers are responsible for paying the buyer’s agent commission if the seller does not pay. However, the buyer’s agent must seek the fee directly from the vendor. The particular contract in the sample outlines the typical scenarios when things like this might occur.

  • For sale by the owner (FSBO): When an individual sells their property without an agent, Luckily, this scenario is rare, and most experienced agents know how to deal with the seller to get their commission.
  • For sale by auction bidding: Homes being auctioned off usually don’t involve a seller’s agent. The compensation for representation in this transaction will vary based on your preferred location. It is best to get a buyer’s agent experienced in home auctions.
  • For sale by the builder: New construction projects usually offer compensation to buyer’s agents directly. However, some builders may justify lower rates with the relative simplicity of selling a brand-new home, leaving the prospective buyer to pick up the difference.

Can I save money on the buyer’s agent commission?

It may sound like an intelligent plan, but avoiding buyer’s agent commission does not align with real estate investment strategies. A commission rebate is the most straightforward strategy buyers can use to get extra money in the home-buying process. After the closing and transfer of ownership, the buyer’s agent pays the client, completing the rebate. Unfortunately, some states have outlawed this practice, a move many researchers agree is anti-competitive and not consumer friendly.


Buyer’s agents deserve the commission for all the efforts and resources put to work to get you the ideal property. However, the buyer’s agent’s commission is not too high, considering the results it brings for buyers. As a word of advice, we recommend using a buyer’s agent when buying your next investment property. There’s no better way to find the perfect property than using a buyer’s agent.