Real Estate Commission

Commission is the way in which the estate agent is paid, and is probably the most unfair and unethical form of payment imaginable. Real estate commissions have been described as a form of "wealth tax" levied by estate agents.

The use of the commission concept allows the estate agent to charge fees that are totally unrelated to the amount of service provided. This becomes apparent when the tasks involved in the sale of residential real estate are broken down and examined individually. In addition, each time property values rise, remuneration for the estate agent rises without any increase in the level or quality of service offered by the estate agent.

The estate agent requires comparatively little skill or training to perform his or her role. Other professionals in the real estate industry carry much more responsibility (e.g. lawyers and valuers) and must gain tertiary qualifications in order to become accredited.

In his book "Real Estate Without Agents" (Rowley Publications Sydney 2004) journalist Terry Ryder observes at p.6 that an estate agent's commission, if converted to an hourly pay rate, equates to $675 per hour!

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