The amount Queensland agents should charge for letting a property
“How much should I be paying?” It’s a common question that investors are right to ask about every aspect of real estate.
For Queensland investors looking to rent out their property, it’s all about the agent’s fee. Property Observer has looked to Fair Trading Queensland to determine what fees your agent should be charging you. This is for both residential and holiday lettings, and agents fees can be a number of charges including commission on rent and a letting commission.
Letting commission, or that once-only cost you pay at the start of each tenancy agreement, is for the agents costs of advertising the property and setting up the new tenancy.
Of the rent your tenant pays, your property manager takes their portion and provides the rest to you.
In this case, Fair Trading notes that it’s the length of the tenancy that determines the cost. We note that the figures cited by Fair Trading are the maximum allowed commissions in all instances, and not necessarily the industry norms.
For tenancies two weeks or shorter, the maximum is 50% of one week’s rent.
For more than two weeks to three weeks it is 75% of one week’s rent.
For more than three weeks to one year it totals one week’s rent.
For one to five years, the fee is 5% of one year’s rent. And for more than five years, it’s 7.5% of the average annual rent.
For commission on rent, this depends on whether they have charged you a letting commission.
If so, then it will be 5% of the rent for the first year, and 7.5% from then on. If not, then it will be 7.5%.
Other charges may be seen for repairs or replacements at the property if they are required to supervise. This has to be agreed to in writing.
Finally, Fair Trading notes that for holiday letting the maximum for three months or more is 9% of the total rent, and for less than three months it comes to 12%.
They also note that some agents do not charge a letting commission on holiday rentals, which makes sense considering how many holiday rentals utilise online listings sites to find clients.