WHAT ARE THE STEPS INVOLVED IN SELLING REAL ESTATE?
- Choose a real estate agent
- Decide on a method of sale
- Agree on an appropriate marketing/advertising programme
- Decide on a desired list price
- Sign a PAMD Appointment of Real Estate Agent (Sales and Purchases) Form 22a with the nominated agent
- Prepare your property for sale
- Arrange for buyers to inspect property
- Agree on the price offered by the buyer or nominate the reserve price in the case of an auction.
- Sign a Contract of Sale
- Arrange with solicitor/financial institution for transfer of property
- Pay commission to the agent.
WHAT FORMS ARE USED FOR SELLING REAL ESTATE IN QUEENSLAND?
Form PAMD 22a - Appointment of Real Estate Agent (Sales and Purchases)
Form PAMD 23 - Sole or Exclusive Agency Notice for Sale of Property (Auctioneer)
Form PAMD 24a - Appointment to Act as an Auctioneer
Form PAMD 25 - Sole or Exclusive Agency Notice for Sale of Property (Pastoral House)
Form PAMD 26 - Appointment to Act as Pastoral House
Form PAMD 28 - Disclosure of Beneficial Interest to Seller
GST AND PROPERTY SALES
Will GST apply to the sale of the family home?
No. In most cases GST will not apply to the sale price of existing residential real estate, including the family home.
Will GST apply to agents fees and advertising costs incurred when selling my property?
Yes. GST will apply to agent's fees and advertising costs agreed to when entering into a Selling Agency Agreement.
Will GST apply to the sale of new homes by developers?
Yes. GST will apply to the sale of newly constructed residential properties by a developer who is registered for GST. The margin scheme (see later) may provide significant savings in this regard.
Will GST apply to the sale of a residential investment property?
Generally, GST will not apply to the sale price of any existing residential property irrespective of whether it is a family home or an investment property. GST will however apply to the sale price of newly constructed homes, including investment properties, which are sold by a developer who is registered for GST.
Will GST apply to the sale of vacant residential land?
GST will apply to the sale of vacant residential land notwithstanding that it may have been sold previously, if the entity selling the land is registered or required to be registered for GST, the supply is made in the course or furtherance of the entity's enterprises, the entity makes the supply for consideration and the supply is connected with Australia (s9-5 GST Act). However, the parties to the sale of the land may consider the application of the margin scheme to reduce the amount of GST payable on the sale.
WHAT ARE THE COSTS OF SELLING REAL ESTATE?
Selling your property can incur costs such as the real estate agent's commission and legal fees when using a solicitor. The REIQ recommends sellers take into account the agent's commission, advertising and marketing costs, a valuation report, pest and building inspection reports, as well as legal and financial fees when they sell their property.
1) Agents Commission:
The Property Agents and Motor Dealers Act 2000 regulates the real estate industry in Queensland. Introduced on July 1, 2001, this legislation has changed the way consumers buy and sell property in this State.
The Queensland Government has set the commission for real estate agents at a maximum of 5% of the first $18,000 of the sale price and 2.5% of the balance of the sale price. 10% GST is also payable on the agent's commission.
2) Advertising & Marketing Costs:
Real estate agents will charge the seller fees for advertising and marketing your property in order to achieve for you the highest possible price. This can involve advertising your property in local newspapers, on property websites, or dedicated property magazines. GST is payable by the seller on these items and included in the advertising account.
Remember that the agent must itemise these costs - before the Appointment of Real Estate Agent (Sales and Purchases) PAMD Form 22a is signed by the seller - and both parties must sign the Advertising Schedule agreeing to the advertising and marketing items and their costs.
Advertising and marketing is particularly essential if you decide to auction your property - the more people who are aware of the auction date, the more likely it is you will achieve a high turnout on the day and consequently sell your property at the best price.
3) Legal Costs:
Solicitor's fees are negotiable - it is advisable to compare the fees being charges by a few different solicitors. Good referrals and past experience is valuable when choosing your legal representative.
Sometimes sellers are required to procure the Title Deed to their property through a solicitor.
4) Financial institution fees:
As the seller of property your bank or financial institution may charge you for their attendance at the Settlement to receive and discharge the mortgage. Fees vary between institutions.
5) Valuation report:
In some cases the seller may wish to procure a valuation of their property to give to potential buyers. In Queensland, contact the Australian Property Institute on Ph: 07 3832 3139 for names of registered valuers.
6) Inspections and other miscellaneous items:
Miscellaneous costs to the seller can include preparing the property for sale through garden and painting service providers and other attendant costs of making the property look its best for potential buyers.
Sometimes real estate agents will encourage sellers to procure a pre-sale building and pest inspection report from a licensed professional (see
www.bsa.qld.gov.au for more information). This can help to save the seller time when it comes to selling the property, as buyers are able to appreciate upfront the condition of the property for sale.
