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Selling a house is an important step and one that needs careful consideration. The rules, regulations and legal protection in this area are worth understanding before any real estate venture. In the lead-up to the sale of your home, it pays to do some research on the likely market value of your property and the process of selling property. In this section of the Alex Scott & Staff website you will find answers to many of your questions when it comes to selling.

The Agent – Seller Relationship

The relationship a seller has with an estate agent is different to that of a buyer. Estate agents are obliged to act responsibly and ethically when dealing with both buyers and sellers. However, the agent’s responsibility is to the seller, unless they are acting as a buyer’s advocate also known as a buyer’s agent. It is important for a buyer to be aware of this whenever he or she is dealing with an agent. Sellers who engage or list with an agent are employing the agent’s services to help sell their property. The agent is bound by professional conduct regulations to always act in the best interests of the seller and to engage in good estate agency practices. The agent will charge a fee for this service, usually in the form of a commission, which can be a percentage or a negotiated fixed fee. A seller can expect the agent to give an estimated selling price of the property and to communicate all offers to buy.A seller can generally expect the agent to:

  • Advise on a method of sale
  • Advertise and market the property, and provide a marketing plan
  • Organise and attend open house and other inspections
  • Attract prospective buyers
  • Organise and conduct an auction
  • Arrange the signing of the contract
  • Collect and hold the full deposit.


Most agents obtain their fee from the seller in the form of a commission upon completion of the sale. An agent cannot obtain a commission without an authority to sell signed by the seller. An agent is required by law to advise the seller that the commission is negotiable, prior to the seller signing the authority to sell. There is no set amount for a commission; it is negotiable between the seller and the agent, and can be set at whatever amount both parties agree on. The commission can be paid as either a flat rate or as a percentage of the sale price. The agreed commission, whether a flat rate or fee, must be recorded on the authority to sell. If it is recorded as a percentage (%), it must also be shown as a figure in dollar terms. If the agent is using a commission scale, ensure that it clearly and accurately outlines how much could be paid. For example, the agent’s commission may be 3% on a scale up to $500,000 and 3.5% if the price goes above $500,000. The seller may interpret this as meaning that only the amount above $500,000 has a 3.5% commission, but the agent’s interpretation may be that if the sale price exceeds $500,000, the entire sale price has a 3.5% commission. GST is payable on the commission fee.

Authority types

The most common type of sales authority is the ‘exclusive authority’, which means that the sellers appoint a single agency to market their property exclusively. Under an exclusive authority the agent is entitled to commission when the property is sold. Sellers should not sign more than one authority, as in certain circumstances more than one commission may have to be paid. An agent can claim commission under an exclusive authority even if the sellers end up selling their own property themselves. It is less common to use a ‘general authority’. With a general authority sellers can list with more than one agency, and only pay commission to the agency that sells the property.

The selling price

do not choose an agent just because he or she gives you the highest estimated selling price. Have several agents appraise your property and give you an estimated selling price. Ask them to justify their price by showing you, for example, similar properties sold at similar prices in the area. Take into account the agent’s overall marketing plan when making your decision.

When is the commission paid?

Clarify with the agent the exact circumstances under which the commission must be paid, before signing the authority. do not sign without carefully reading and understanding the authority to sell. If you are unsure of anything, ask for clarification from the agent, contact the Estate Agents Resolution Service or seek professional legal advice. By law the agent is obliged to provide a copy of the authority to the seller at the time of signing. Retain this as proof of what was agreed with the agent.

Changing the Sale Authority

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

Methods of Sale

The decision to sell by auction or private sale will depend on many factors including the type of property and location, as well as the seller’s available time frame and personal preference.There are two main ways that real estate can be bought and sold:

Private Sale

In a private sale the property is advertised and offers are invited from prospective buyers. The sale is negotiated between the buyer and seller, usually with the assistance of an agent.

Public Auction

An auction is a public sale, usually conducted by an estate agent acting as auctioneer. It is advertised for a specific place, time and date. Prospective buyers bid and the property is sold to the highest bidder, provided the seller accepts the bid.

Advantages of Auctioning your property, being:

  • The property is offered on your terms and conditions on an “unconditional” basis
  • It sets a time limit on negotiations, in that most of our properties are sold at Auction, within 6 weeks from commencement
  • Buyers like it because it is the most transparent way of purchasing properties as they can see the other bids.
  • We have no added cost for conducting an auction.

Get your property into shape

Some handy presentation hints for preparing your property for sale

  • Weed and cultivate the garden beds
  • Add a splash of colorful flowers to the garden
  • Remove rubbish
  • Repair and paint where necessary
  • Ensure fences are in good order
  • Clean walls, floors and windows
  • Prune trees or shrubs close to the property to help with natural light
  • Clean dust and cobwebs from the exterior
  • Steam clean carpets (if necessary)
  • Repair items such as dripping taps, sticking doors and drawers
  • Remove all unnecessary articles from cupboards. It has to be done eventually. Better to do it now and display the full value of your storage
  • Create an entrance or decorate a dull garden with pot plants and garden furniture that can be taken with you
  • Store excess furniture to ensure rooms appear as spacious as possible


Disclaimer: Consumer Affairs Victoria produces a guide as a summary for buyers and sellers, of which the majority of information found following was taken, with permission from Consumer Affairs Victoria. It should not be used as a substitute for the Estate Agents or Sale of Land Acts, or professional legal advice.To obtain a copy of the guide for buyers and sellers contact your nearest Alex Scott office or:

Consumer Affairs Victoria
Estate Agents Resolution Service
452 Flinders Street
Melbourne Victoria 3000
Phone: 1300 73 70 30 (local call charge)
Email: consumer@justice.vic.gov.au
Website: www.consumer.vic.gov.au

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