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How to negotiate agency fees?

Real estate agencies freely set their fees, at least vis-à-vis the owners. However, depending on the location, the property, market conditions but also from one brand to another, the prices can go from simple to triple. Thanks to a good negotiation, it is however possible to lower the bill.

Earn your sale

The context of the real estate sale is the most conducive to the discussion on the price. For an apartment valued at 450,000 euros, it is thus necessary to count on average 5.4% agency fees in France, according to a 2018 study carried out by the manager Homepilot. Except that the rate varies from 4.8% to 5.8% depending on the city and can even go from 4.5% to 6.5% from one network to another within the same locality. Therefore, any owner must consult several agents to find the one that will best meet their expectations. Attention, it is before signing any mandate that the fees must be negotiated.

In particular, you will be in a position of strength if a large number of agencies compete within the perimeter or in the event of a scarcity of accommodation for sale in relation to demand. Of course, the more valuable the house or apartment to be sold, the more the pros will be inclined to make a move to obtain the contract. It is much easier to negotiate a lower commission, in return for an exclusive mandate which ensures that the real estate agency is alone in the running to conclude the sale.

Note that the buyer can also try to haggle over the fees! Indeed, even when these costs are borne by the seller, they are generally passed on in the sale price. When making an offer, the buyer can then obtain a discount from the owner but also from the real estate agency if both are in a hurry to sell and there are few candidates.

The more supervised rental

Rental management fees can also be very high. It is estimated that they represent between 6 and 10% of the annual rent received by a private lessor. In this regard, it is more on the side of the services provided that there is room for tariff manoeuvre. The price required for the minimum package offered, namely the collection of rents, the issuance of receipts and the payment of charges, without forgetting their regularization, may be increased by more comprehensive services, such as the drafting of the rental contract, the management of any work and repairs or even assistance in carrying out the tax declaration of rental income. Here again, competition between agencies is therefore essential. On the other hand, a price negotiation will be less easy, unless you have several properties to put in management.

As for the tenant, his chances of obtaining any discount are slim, even non-existent in areas of real estate tension. Indeed, the rental costs at his expense are already limited by law. The cost of the inventory is 3 euros maximum per m2, while the costs of file and drafting of the lease must not exceed 12 euros per m2 in Paris and in 68 neighboring municipalities (very tense areas), against 10 euros in tight areas and 8 euros per m2 in the rest of the territory. There is therefore little hope that the real estate agent will agree to an additional gesture.

Negotiation encouraged

The law requires all real estate agencies to clearly and legibly display their fees for sales and rentals. The scales must be affixed to the window and be visible from the outside, but also be available on the brand’s website. In addition, the poster must mention for each of the services who is responsible for payment (seller, buyer, lessor, tenant).

The precision of these tariff schedules could until now limit the possibility of negotiation since any discount granted to a customer could be considered as a misleading commercial practice and therefore had to remain very exceptional. A decree of January 26, 2022, however, brings a welcome relaxation by modifying the display rule. Since April 1, 2022, the scales of real estate agencies must indeed indicate maximum rates. It is therefore legally possible for them to lower the price of their service for a sale, rental or even for property management. As Bruno Le Maire, the Minister of the Economy, said in a press release: “This decree will allow better competition between professionals with regard to the amount of their fees”. It remains to be seen whether the agencies will agree to negotiate…

Source: 20minutes

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