The payment of the deposit is one of the most exciting moments in any property sale—for a real estate agent, it means payday. The real estate industry is competitive and sometimes brutal: if you don’t sell, you don’t get paid. A common misconception is that real estate agents are primarily motivated to get the highest sale price. In reality, research shows that agents are more incentivized by the speed of the sale rather than maximizing the price.

Think about it: do you really believe an agent wants to spend endless weekends showing a property? Most top agents would rather run a three-week campaign, sell at auction or through negotiation, take their commission from the deposit, and move on to the next listing. The difference of $20,000–$50,000 in the final sale price is often far less significant to the agent than getting the sale done quickly.

When a property sells, the commission is deducted from the deposit. Once the Sale and Purchase Agreement goes unconditional—meaning the buyer is committed, financing is arranged, and all reports have been reviewed—a deposit (usually 10% of the purchase price) is paid into the real estate agent’s trust account. While there is no strict legal requirement for the deposit to be exactly 10%, it generally covers the agent’s commission. This is a key part of how real estate agent commission New Zealand is structured, ensuring agents are paid promptly once a sale is confirmed.

One surprising fact about real estate agent commission New Zealand is that the vendor pays the commission even if the buyer later defaults. So, if the sale doesn’t settle, the agent still receives their commission. After ten working days, the agent deducts their commission, and the remainder is transferred to the vendor’s lawyer.

This can be shocking for sellers. Imagine going through the entire sales process, paying the agent, and then the buyer fails to settle—you are out of pocket while the agent is still compensated. Many vendors ask if the commission can instead be paid from the settlement or what happens if the buyer doesn’t follow through. The answer is almost always that the agent’s payment is guaranteed regardless.

Real estate is a results-driven business. The main priority for agents is to sell properties efficiently, not necessarily to achieve the absolute highest price. As Kapil Rana once famously said, “At the end of the day, we all like money.” Understanding how real estate agent commission New Zealand works can help vendors navigate the process more confidently and avoid unexpected surprises.