Costly mistakes when selling a house in Australia (and how to avoid them)

The most expensive mistakes in an Australian property sale are made on paper, before the home is even listed: signing an agency agreement with a long exclusive period and marketing payable whether or not the home sells, choosing an agent for the highest estimate, forgetting the ATO clearance certificate so that 15% of the price is withheld at settlement, or, as a buyer, breaching the conditions of a first home duty concession and having to repay it. Each of these can cost thousands of dollars, and each is avoidable with a few hours of reading and the right questions. The table below ranks ten common mistakes with an illustrative dollar impact.

This is the starting guide for the Costly Mistakes and Official Sources section. The detailed guides are:

Ten mistakes and what they cost

Mistake	Illustrative cost	How to avoid it
No clearance certificate at settlement	15% of the price withheld: $135,000 on $900,000, recovered only through your tax return	Apply to the ATO as soon as you decide to sell
Choosing the agent with the highest estimate	Months on the market and price reductions; even a 3% cut is $27,000 on $900,000	Test estimates against comparable sales
Marketing payable even if unsold, then changing agents	Paying for two campaigns: $6,000 + $6,000	Negotiate payment at settlement or a refund if unsold
Two agents claiming commission for the same buyer	A second commission of $20,000 or a dispute	Read the introduction clause; give the old agent written notice
Commission payable on exchange, and the buyer defaults	Commission owed without a settled sale	Make commission payable on settlement
Comparing commission in percentages, not dollars	0.3% on $1,200,000 = $3,600 plus GST	Convert every quote to dollars
Missing a duty concession's move-in deadline (buyer)	Repaying the concession plus interest: $29,287 on a $780,000 NSW home	Diary the deadline before settlement
Assuming the main residence exemption applies after renting out the home	A taxable gain you did not plan for	Check the six-year rule and get a valuation when you first rent
Selling as a foreign resident without advice	No main residence exemption, plus 15% withholding	Get tax advice before signing while overseas
Not reading the vendor disclosure or contract special conditions	Termination by the buyer, or a price reduction	Have a conveyancer prepare documents before listing

These figures are examples to show scale, not typical outcomes.

Mistakes in the agency agreement

Most selling costs are fixed when you sign the agency agreement. Look at:

Exclusive period: a long period with no performance exit locks you in.
Continuing authority: some agreements continue after the exclusive period until you end them in writing.
Introduction clause: commission may be payable if a buyer the agent introduced buys within a set period after the agreement ends.
Marketing: amount, timing and whether payable if unsold.

In New South Wales you can cancel an agency agreement until 5 pm on the next business day or Saturday after signing. Use that time to read it properly. Details are in agency agreement traps.

Mistakes about price

Underquoting, where a home is advertised below what the seller will accept or the agent's estimate, wastes buyers' money on inspections and reports and is illegal in New South Wales and Victoria. For sellers, an agent who quotes a high estimate to win the listing and then "conditions" you to accept less is the mirror-image problem. See underquoting, price guides and cooling-off.

Mistakes with tax and settlement

Clearance certificate. Since 1 January 2025 it is needed for every sale. Without it the buyer must withhold 15%.
Mortgage payout. Ask your lender for a discharge form early. A late discharge authority can delay settlement and trigger penalty interest under the contract.
Fixed-rate loans. Repaying a fixed loan early can trigger a break cost; ask your lender for a written estimate.
CGT timing. The CGT event happens when the contract is signed, not at settlement, which decides the tax year.

Mistakes buyers make with costs

Underestimating duty and other upfront costs; see upfront costs of buying a home.
Paying for building reports on homes they had no realistic chance of buying because of underquoting.
Missing the cooling-off deadline, or waiving cooling-off without understanding the risk.
Moving in late or renting out the home and losing a first home concession; see concession conditions and clawback.

When to get professional help

See a solicitor or licensed conveyancer before you sign an agency agreement you do not understand, before signing any sale contract, and if there is a dispute. See a registered tax agent if the home was ever rented out or used for business, or if you are or were a foreign resident. If you have a complaint, follow the complaint steps.

Frequently asked questions

What is the single most expensive avoidable mistake?

For many sellers it is the choice of price strategy and agent, because a poor campaign can cost more than the entire commission. For a seller who forgets the clearance certificate, the cash-flow hit of 15% withholding is the biggest immediate shock.

Can I get out of an agency agreement I regret?

Only on the terms of the agreement, or within any statutory cooling-off period. Ask the agency in writing; many will release a seller who is unhappy rather than keep an unwilling client.

Who checks the agent's final account?

You do. Compare the commission rate, the price and the marketing invoices against the agreement before the agent releases the deposit balance.

Is underquoting still common?

Regulators in New South Wales and Victoria continue to run compliance programs and issue penalties for underquoting. Buyers should still do their own price research.

Official sources

Australian Taxation Office — clearance certificates and CGT on property
NSW Fair Trading — agency agreements and underquoting
Consumer Affairs Victoria — underquoting and selling property
Revenue NSW — first home duty concessions and reassessment