I can understand why this is a problem in France. In Sete, where I am, all the agents charge 8% or 10,000 euros, which is ridiculous and I don't care how much work they do, they are not worth that much. I think if the young couple's agent friend contacts me again I will, as you suggest, try to get my agent to reduce their commission - though there's no way they're going to reduce it to 3%, so I reckon I'm going to lose out on the sale. C'est la vie!
To be clear on the matter why not get some free advice from your notaire ? He or she will give you advice based on the up to date rules & regs. i'm sure the rules have changed considerably since I last did house selling in the '90s.
The first agent has done the groundwork and I don't think I could 'cheat' them out
of an honestly earned commission.
Thanks Peter - that is the phrase I was looking for - "bon de visite". They must have signed this with Agent A (who I am registered with and have added 10,000 euros to the buying price as their fee). However, Agent B (their friend) has told them that he will add only 3,000 euros, so saving 7,000 euros, a tempting offer. However, I would not feel happy about sneaking behind Agent A's back, as they did arrange the viewing and as you say, legal action could be taken.
Don't know much about the Dutch market. But not much different from France I dare say. However, in Holland the prices are even more inflated because the interest on the property loan is deductible from your income. So if you earn well and pay 50% income tax, the gouvernement pays half of your mortgage fees. This means you can pay twice as much for your house, especially because many mortgages payments are interest only, no reimbursement.
Whole different ball game.
But in the Netherlands everybody sells through an agency (using only one!), because they only ask 1.5% and the market is 100% transparant. Plus, the buyer will hire his own agent, to represent his side of the deal. Together they pay 3% in fees, but at least you know what you are paying for.
One of the reasons to start Immogo was frustration from a buyers standpoint about having to pay a price 6% higher for the privilege to be mislead by an agent. When I bought my first house, the agency told me negotiation was not possible in this region. And since he was my agent, I believed him! That was in 2000, and because of the internet lots has changed, especially in the field of consumer information.
Have to agree Gregor, my property has been reduced to a now rock-bottom price and still there is little interest ! It's disheartening but I refuse to give my property away when I know anyone buying this place will get excellent value for money plus the fact I still need to buy somewhere else or live on a park bench !
I always believed the french market would follow the UK trends but this doesn't seem to be happening except for maybe the cheaper properties.
How's the dutch market domestically nowadays ?
Hi Peter, doing fine here. Are we talking about legal fees or agency fees? I just translated and published my article about who pays the ferryman agency on blog.immogo.com T agree it is a moot point, since the money paid to the AI comes out of the budget of the buyer and the profit (if any) of the seller.
Legally it is the seller though, who pas the agency. So if legal problems arise, the agency will always turn to the seller. Unless of course the buyer has signed a 'mandat de recherche' but those are sill rare.
About the market... we see a steady rise in visitors, but that might also be due to other factors. I don't see much more sales, neither through us nor otherwise.
Prices keep going down. An really interestingly priced properties will sell eventually. On the other hand we have really nice ads (good description and many photos) on our site that hee been viewed thousands of times without generating a single information request. Those are obviously too expensive.
Hi again Gregor, hope you are well
It's a question of semantics, both parties sign the Compromis and then the Acte and the seller receives the agreed selling price net vendeur and the legal fees are added to the total which has to be paid by the buyer, if that's what's been agreed. I recall several occasions where the legal fees have been split between both parties and once the seller actually paid the fees. In olden days it was common for the seller to pay the legal fees in certain areas of the country. That is to say, the seller received the net sum and fees were then taken out by the notaire. As I said, a question of semantics.
Any signs of the market picking up Greg ?
Beg to disagree. It is the seller who has signed a mandat and has to pay the fee. The buyer pays the total price to the notaire in the name of the seller. The seller pays the agent.
If the buyer wants to cheat the agent and buy directly, it is the seller that wil be sued by the agent, not the buyer. The buyer has no contract with the agent, and a bon the visite has no contract value. It is only used in court to prove that the buyer was presented to the seller by the agent, so the seller has to pay up.
Of course the agent will tell the seller that the fees are added to the net price and will therefore be paid by the buyer, but this is legally not correct. I wrote an article about this on my blog, but only in Dutch and French. I'll make an english translation and post it here.
This is not correct. The buyer has a free choice of agent. So if the finds the same house he was shown already cheaper (lower commission) with another agent, he can switch agents.
The only thing that might get in the way is the fact the mandat with the second agent will be signed after the house was shown by the first agent. So the trick may be a bit obvious. But legally the first agent does not have a leg to stand on.
It is the buyer that pays the fees - not the seller.
You can't cancel a mandate and then turn around and sell to a client brought in by the cancelled agent. In the mandate it states that even after cancellation a sale to clients from the agent will have to be paid. Usually the time frame is six months. So you'd have to wait six months before you can sign a compromis without paying the agent.
Of course this is assuming the agent finds out about it. Scrøwing the agents is a national sport in France. I'm just selling my house now, and the first thing a prospective buyer asked me (when he got me alone) is wether we could do things without the agents.
Even though I am no friend of the French Agent Immobilier (the Fnaim took me to court once trying to forbid Immogo) I do believe that the agent who finds the buyer needs to be paid. It is a matter of principle. He (or she) did his job finding a buyer, so the contract should be honored.
As to who pays the agent immobilier... it is the seller who has a contract with the AI, promising him 6% in case of a sale. For tax purposes it can be better to in the end transfer these costs on paper to the buyer, who then does not have to pay notary fees over that part of the total sum.
But buyer or seller... in the end the fees come out of the negotiation room. If you don't have to pay an agent, you have 5% more room to play with.
By the way, more and more agents will accept a lower commission. You can go as low as 3-4%, depending on the value of your property. So never accept the 6% the agent will start off with. Negociate!
Thank you Sheila - noted and saved in the document!
Gillian,
No doubt the original agent insisted that the viewer signed a "Bon de Visite" when they showed them your apartment.
If the same buyer then buys through another agent the original agent can sue for their fee as they showed them your property first.
Agent from M
The vnedor has to receive the amount written into the Compromis unless the notaire has other expenses to deduct which I can't imagine happening. The agents' fees are also written into the Acte de Vente and the notaire can only give the agent that amount. The books have to balance.
No, the agreement is fixed even if you cancel the 'mandat'. The original agent will have the right to his or her commission, and quite rightly so.
The same rules apply to internet sites such as PAP etc.
The price is fixed by the vendor, then the agent will add their commission (in the case of the agreement I saw 6%).
Someone here may also be able to help with confirming( or denying) another story I was told that, if the vendor wanted 100,000, the house was marketed at 110,000 plus commission, the agent can keep the difference provided the vendor gets the 100,000?
Usually yes but it's not always the case.
Except Peter that it happens all the time and my OH has had several sales pulled out from under her after showing people round houses. more than once with one couple, who then go to do a commission deal with another agent. What Gregor says is what I hear at home. Any agent can get an exclusive mandate, which is then protected so they they are the only agency, but too many people put up the house with anything up to four agents. Cancelling a mandate one day and then accepting an offer through another next day is common too. I get the jumping up and down angry bits of that here :-(
Would it not be wiser to give notice to cancel any arrangement with agent one before dealing with agent two. If the wording states that their commission is payable if the vendor sells to someone agent one introduced, this will apply until the agreement is cancelled.