Commissions of real estate agents in different countries
In Austria, the commission in most cases is paid by the buyer, its size is 3% (including VAT 20% – 3.6%). The amount of remuneration is regulated by the Code of Acts for Real Estate Agents (Rechtsvorschrift für Standes- und Ausübungsregeln für Immobilienmakler), and the realtor does not have the right to demand more than what he should be.
According to the company MKR Real-Consulting, when the value of the object is less than EUR 36,336.42, the maximum commission reaches 4% of the cost (including VAT at 4.8%). “However, such transactions occur very rarely, because such a property value is not typical for Austria,” explains Konstantin Isakov, director of Austria-Invest.
According to Konstantin, sometimes the seller may pay the real estate agency 1–2% for his part, but this rarely happens, for example, when the seller is a developer who needs to quickly sell apartments in a new building.
“For commercial real estate and luxury housing, the rules are the same, the commission is 3.6%. But in practice, this percentage (especially in multi-million dollar transactions) is the subject of discussion between the buyer and the agency, ”says Konstantin Isakov.
In the UK, there are seller agents and buyers agents. “In the residential market in 96% of cases, the seller pays a commission to his agent, who represents his interests (but not the interests of the buyer),” says Dmitry Zakirov, a partner at LonGrad. – There are also professionals who protect the interests of the buyer. This is a very frequent practice in London, where most of the buyers are foreign investors who prefer to pay for the service (search for exclusive and most profitable options, expert evaluation, transaction support, etc.). Such agents are paid by buyers. As for commercial real estate, most often both parties (buyer and seller) appear to be professionals. ”
In the UK, the commission is lower than in other countries. According to Dmitry Zakirova, in a more dense market (up to 500 thousand pounds sterling) independent real estate agencies reduce the commission to 0.5% of the selling price of the property, while the most common level is around 1.5–2.0 % The amounts rise to 2.5–3.0% for the most aggressive companies (for example, Foxtons). In the more expensive market (£ 5–15 million) commissions do not exceed 1–2%, and with budgets of 20 million or more, it is not necessary to expect more than 1%. The exception is the sale of investment proposals (as a hotel room, student hostel, etc., but these are small investments: 50–500 thousand pounds), where developers are willing to pay up to 5–7% to attract potential investors. ”
In the UK there is no law regulating the size of the commission. Interest is determined by the agreement between the client and the agent and competition in the market.
As for discounts from commissions, then, according to Dmitry Zakirova, in the UK everything depends on the results of negotiations: agents can reduce the amount of payment for their services to sellers or developers (with exclusive contracts or the simultaneous sale of several objects), consultants can make a discount on their services to the buyer with secondary circulation.
The commission of a real estate agent in Hungary is 3-5% of the market value of real estate (plus VAT 27%). According to the real estate agency Duna House, in most large agencies the remuneration is 5%, and the seller always pays him according to the terms of the contract with the realtor.
In Germany, the commission for objects with a contract value of up to 15 million euros ranges from 3.57 to 7.14% (including 19% VAT), for objects with a cost of more than 15 million euros – at least 2.38% (including VAT). “However, even for expensive objects commissions rarely fall below 3%. The ads almost never indicate a remuneration of less than 3%, and bargaining up to 2% is possible after negotiations with the broker, ”says Sofia Latypova, sales manager at Tranio.
The recommended amount of commission for each federal state is determined by the local association of realtors. There is no law regulating the size of the commission. The amount of remuneration is determined by market competition.
In Germany, the commission is most often paid to the broker by the buyer. “In Germany, a commission is almost always taken from Russian clients. It’s not a fact that the seller will pay, especially when it comes to a liquid asset, ”says Marina Filichkina, head of sales at Tranio.
In Greece, the standard remuneration is accepted: each side of the transaction pays the realtor 2% of the value of the object.
Commission VAT is 24%, paid by both the buyer and the seller.
In Spain, the seller almost always pays the commission. in this country, realtor fees usually vary from 1.5 to 5% of the transaction amount. However, when the value of the object is small, a fixed amount of commission is established – most often 6 thousand euros. Typically, in the primary market, the commission is lower than in the secondary market (as a percentage). And the more expensive the object, the lower the commission in relation to its value.