Alam likes to call real estate agents and argue. The Campbelltown-based builder believes in doing things directly: he builds homes, sells them himself and is always wary of middlemen.

He even holds his own real estate agent’s licence, which makes him feel like he knows the enemy.

“I can sell better than any real estate agent in Australia,” he says. “Why do they ask for a 2.4% commission? Any real estate agent in Australia can ring me and my question is: ‘What do you do that means you can charge 2.4%?’”

“They should get,” here he pauses, “$500 maximum.”

Alam, who did not want his last name used, is in the process of selling a four-bedroom home in Elderslie, south-western Sydney. He has listed it on Gumtree with a few photos and a $780,000 pricetag.



With Sydney’s house prices rising 20% in the 12 months to April, Alam is a frequent property investor and among a growing number of people looking to dodge the tens of thousands of dollars in agents’ commissions.

At the time of publication, Gumtree Australia had nearly 6,000 properties listed for sale. “Sell your own property” sites, such as forsalebyowner.com.au and buymyplace.com.au, provide marketing, photography and ad placements for between $600 and $2,000 and say they are surging in popularity. Purplebricks, a UK company which uses agents but charges discounted fees by connecting sellers on an online portal, says it processed 435 sales in its first six months in Australia after launching last year.

However, John Cunningham, the president of the Real Estate Institute of NSW, says data from two years ago shows only 1% of sales are made without agents, excluding sales to close friends or relatives.



Across Australia, the only thing you need to legally sell a house is a valid contract of sale. Private sellers like Alam deal with buyers directly, handling all the advertising, photography, inspections and negotiation themselves.

Contracts – and the accompanying exchange and settlement – are usually handled with the help of a solicitor or conveyancer, but they are not strictly necessary.

The Law Society of NSW advises that it is legal to draft your own contract and do your own conveyancing, but recommends hiring a solicitor.

“It is legal ... However the risks may outweigh any potential savings,” says a spokeswoman.

Average commission rates for selling houses range from 1%-2% in Sydney and Melbourne, to 3%-4% in regional areas. Photograph: Paul Miller/EPA

According to the Law Society, solicitors help sellers ensure their contracts comply with vendor disclosure laws that vary state-to-state, and also advise them when negotiating the terms of the contract with the buyer.

A spokeswoman said sellers should be especially careful in New South Wales, where it is an offence to place a house on the market without a proper contract, or when selling apartments, as strata titles require additional documentation.

Naturally, Cunningham, as president of the peak body for real estate agents, also recommends sellers should employ agents.



He says average commission rates range from 1%-2% in such high-density areas as Sydney and Melbourne, to 3%-4% in regional areas or states such as Western Australia and Tasmania. On top of that, marketing is charged separately at 0.5% to 1%.



For a house in Sydney, where the median price is $1m, that comes to $10,000 – $20,000 in commission and $5,000 in marketing.

In contrast, listing an ad on Domain as a private seller costs $660 for 8 weeks or $770 for 12 weeks. Gumtree listings, where Alam advertises, are free. He says the only person he employs is a solicitor, who costs less than $1,000 per sale.

“There shouldn’t be a market,” he says. “I know how it works. I’ve put advertisements on Gumtree and realestate.com.au and it doesn’t cost that much.”

However, Cunningham says the purported savings are a myth: “The concept of what people think they are saving is not what they are actually doing.”

He says real estate agents deliver higher prices for sellers through their experience in negotiating and valuing.

“We are in a really time-poor world, moving into a more specialised world and the whole selling and buying process is one of the highest, emotionally charged things people ever do. You’re dealing in an area where you are being driven by emotion. It’s very hard.



“Private sellers tend to overprice and thus they miss the market. People think it’s easy to put a price on a property. But you don’t actually know the value of the house in the first place.”

It is my property, I know how to deal, I know how to sell it. Alam

He says that sellers who go it alone are making “the most costly mistake in their lives”.

“They don’t understand the art of negotiation – they’re going into a huge unknown world which is quite complex. It’s one of the most psychologically skilled things in the world. They tend to be their own worst enemy on that front.”

John rejects the idea that there is any fat to cut in the process, or anything in the business model for the internet to disrupt.

“There’s really not much left here in the equation. If you’re looking for a quote on a plumbing job, you’re not going to choose the cheapest one. You pay for what you get in this life – I’d rather fly Qantas than Tiger Air”.

Amy, who lives in the Blue Mountains, is in two minds. She tells Guardian Australia she and her husband have put their home for sale online “as an experiment”.

“We haven’t made the final decision to go with an agent or without,” she says. “We’ve umm-ed and ah-ed and weighed up both sides.”

They are selling their family home in Leura, an hour and a half from Sydney by car. It’s a rare level block in the Blue Mountains, on 1,200 square metres with four bedrooms and 2.5-metre ceilings.

“We’re a young married couple who are doing our best to save every cent we can,” she says. “The money we save can go towards building our new home. We’ve still got a loan that we’re trying to get ahead of by doing this rather than renting. Every dollar counts.

“The advantages seem big, though, in going with an agent. They have many more contacts and experience. And if they do their job properly they want to get the best price they can. But then you’ve got this whacking great fee.”



Amy says she’s received quite a few inquiries on Gumtree, but doesn’t know if any are genuine enough to proceed. “Most of them just messaged, and when I got back to them, they’d never ring.”

Amy, who is thinking about selling privately, says: ‘We keep a close eye on the market so we’re pretty confident we’re fairly accurate.’ Photograph: Sam Mooy/AAP

They have a solicitor, and Amy, who is a photographer, has done the publicity shots herself .

Crucially, they’ve had the house valued by real estate agents multiple times – for free – and say it sits around the high $700,000s.

“We’ve probably had about six or eight through in the past 18 months. We really want to know what we’re talking about. We keep a close eye on the market and the houses around us so we’re pretty confident we’re fairly accurate.”

Alam also denies that private sellers need agents to value their own homes: “I do market research, I look at previous sales, then I figure it out. It’s not hard.”

In January, Victoria introduced legislation to crack down on real estate agent underquoting, after receiving 236 complaints in 2015.

Alam also disputes the idea that agents are better negotiators, saying the three he has previously sold with were unimpressive.



“They didn’t drive a really good price for me, they just tried to sell the property. Some of them are really, really unprofessional because they just don’t care.



“It is my property, I know how to deal, I know how to sell it.”

Amy however, says the issue of an emotional connection to a family home is very real.

“That’s definitely true and that’s one of the reasons that we might go with an agent. All that negotiation side of it is left up to someone else. It’s all a learning curve.

“A lot of agents aren’t very honest. But there’s a lot of good ones out there, there’s honest ones, there’s a couple that we know. You don’t have a lot of faith when you know that others have a track record of not being entirely honest, I haven’t personally experienced that.”

In one week of his listing, Alam has received 105 views and three offers, and he is supremely confident. “Hopefully it will be sold in a few days,” he says.

He does not plan to use an agent ever again.

“I wish somebody would come out and break their business like Gumtree. Maybe one day I will do it.”



