Agency commission: who pays it, how is it set and negotiated?
The agency commission is freely set: there is no legal scale. It is due only if the sale goes through and if the mandate provides for it. It is the mandate that designates the payer (seller or buyer). Its amount must appear in the mandate and be displayed: it is negotiable.
A free commission, but regulated in its form
There is no official scale of agency fees: their amount is free and results from competition. On the other hand, the Hoguet Act and its decree strictly regulate the form of this remuneration, and an order of 10 January 2017 governs consumer information about these fees.
The agent's remuneration must be determined in the mandate: amount or calculation terms, and the party responsible for it. No sum may be required as long as the transaction is not actually concluded and recorded in a deed containing the parties' commitment. An agent who does not have a prior written mandate cannot claim any commission.
- No legal scale: the rate is freely negotiated, often expressed as a percentage of the price.
- The commission is due only if the sale is actually concluded (no commission for merely putting parties in contact).
- The mandate must state the amount or the method of calculation of the remuneration and who bears it.
- The agency must display its fees (scale or bracket) visibly, in accordance with the order of 10 January 2017.
Who pays: seller or buyer?
It is the mandate that designates the party who owes the commission: it may be borne by the seller, the buyer, or shared. This choice has concrete consequences, notably on the base of the transfer duties (notary fees).
When the fees are borne by the buyer (fees payable by buyer mention), the listing and the mandate must state it clearly, because this may change the base for calculating the transfer duties. This allocation must be transparent in the listing.
- Payable by seller: the commission is included in the displayed price.
- Payable by buyer: the price excluding fees and the amount of the fees must be distinguished in the listing.
- The allocation must be consistent between the mandate, the listing and the deed.
Negotiating the fees
Since no rate is imposed, the commission is negotiable, particularly for high-value or easy-to-sell properties. The consideration you obtain (exclusivity, marketing resources, timeframe) may justify a higher or lower rate.
A displayed rate is not an unchangeable floor: discuss the percentage, the flat fee or the sliding scale. Be careful, however, of ancillary clauses (file fees, penalty clause in case of withdrawal) and require that any agreement be written into the mandate.
- The advertised percentage is a negotiable starting point.
- Compare several agencies and the service provided, not just the rate.
- Everything negotiated must appear in writing in the mandate to be enforceable.
Frequently asked questions
Is there a commission percentage fixed by law?
No. There is no legal scale of agency fees: the amount is free and negotiable. The law only requires that the remuneration be determined in the mandate, displayed, and due only if the sale goes through.
Do I have to pay the agency if the sale does not happen?
In principle no: the commission is due only if the transaction is actually concluded and recorded in a deed. The agent cannot demand any sum before that. Beware, however, of specific penalty clauses in the exclusive mandate.
Fees payable by buyer or by seller, what is the difference?
The mention determines who pays and may change the base of the transfer duties. Payable by buyer, the listing must distinguish the price excluding fees and the amount of the fees. The choice appears in the mandate and must be consistent in the listing and the deed.
Read next
- Légifrance - Loi n°70-9 du 2 janvier 1970 (loi Hoguet), notamment article 6 (mandat écrit et conditions de la rémunération)
- Légifrance - Décret n°72-678 du 20 juillet 1972
- Légifrance - Arrêté du 10 janvier 2017 relatif à l'information des consommateurs par les professionnels intervenant dans les transactions immobilières (affichage des honoraires)
- Service-Public.fr - Honoraires (commission) d'une agence immobilière
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