What is a fair real estate commission? We don’t know, but here’s how some other countries break it down. The data is from a 2002 article in The International Real Estate Review (pdf here). If you know the going rate in other countries, please let us know in the comments.
Hong Kong: 1% (lowest in the world)
United Kingdom: 1-2%. In very competitive areas .5- .75%.
Netherlands: 1.5-2%
Ireland: 1.5-2% in the cities & 2-3% in the small towns
Norway: 2-3%
Denmark: 2-4%
Singapore and Japan: 3%
New Zealand and South Africa: average 3.14%
Malaysia: 3% on the first 100K and 2% on the balance thereafter
Australia also uses a scaled system: 5% on the first 18,000 & 2.5% thereafter
Greece & Israel: 4% split between buyer and seller
Italy: 4-6% split between buyer and seller
Canada: 3-6%
Germany, Spain, Thailand, Indonesia, Sweden, Caribbean, Philippines: 5% or less
Finland is interesting: 5% for condos and 3-4% for single family homes
France: 5-8%. There is no MLS in France, but there is that darn VAT (wonder who pays that?)
Mexico: 5-10%. Mexico has an MLS system.
Russia (hold on to your hat): between 5-15% with the average around 10%. In St. Petersburg and Moscow, the commissions are over 15%. There is no MLS and public information is scarce. It is no surprise that FSBOs are very common. (This might be a good advertising venue for agents whose markets have a high Russian immigrant population.)
More details below (click to enlarge)
But as I understand it the British agents are so incompentent that there is a general outcry to move to a more American system with real estate licenses etc.
Also having just just returned from New Zealand, the lack of buyer brokerage and MLS is glaring as well.
Like all things and I know you guys know this, so it’s not an attack, the numbers only tell so much of the story.
Hello there,
Just came across your blog via google search.
Would like to update all readers that the current real estate commission payable by either seller/buyer (most of the time is by sellers) is as follows:-
First RM 500,000.00 - 2.75%
Anything in excess of RM 500,000.00 - 2%
*RM denotes Ringgit Malaysia = Malaysia’s Ringgit
Welcome everyone to visit me at
http://myproperties.wordpress.com and
http://infinitywealthcreation.blogspot.com
Thank you & have a great day !
Agreed Athol. The numbers don’t tell the whole story. They don’t factor in other real estate transaction costs such as transfer taxes, title insurance, etc. The overall cost to transfer property, expressed as a percentage of the sale price, would be a more useful to compare costs.
What would fascinating would be a story about how these numbers originally came about. Who sat down and decided that consumers should pay X percent?
Wow — the VAT tax of 20%+ in some countries makes home ownership a pretty expensive venture. Wonder if you can finance that?
Who would have thought the market in Russia would be so varied? In a region flooded with FSBO’s it’s hard to imagine getting past 10% commission. Those sales must be very specialized or the data is..well, not so good.
Very interesting. I think you get what you pay for, and I bet there are some scetchy real estate deals going on in some of these countries. Of course if you were to ask our clients they would feel that we should probably make less, and if you ask us, we would say we should make more.
and the rent commission ?
in Italy amounts to a first monthly