Commission is the fee paid to a real estate agency for selling a property, usually calculated as a percentage of the sale price plus GST, and paid by the…
Commission is the fee paid to a real estate agency for selling a property, usually calculated as a percentage of the sale price plus GST, and paid by the vendor from settlement proceeds.
Most New Zealand agencies use a tiered structure — a higher percentage on the first portion of the price and a lower percentage on the balance — plus a fixed administration fee, plus GST. Marketing costs are usually separate and often payable regardless of whether the property sells.
On a typical residential sale, total agency costs frequently land in the range of 3–4% of the price including GST and marketing, though this varies by agency and price point. On a $700,000 sale that is a material number, and it comes off your return.
Commission is negotiable. So is the marketing spend, and who bears it.
Investors modelling a sale often forget it entirely. Selling costs — commission, marketing, legal — should be in any exit calculation, and they materially affect the return on a short hold.
The buyer does not pay commission, but effectively bears it in the price.
Last reviewed: 1 August 2026 · General information only, not legal advice.
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