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 |  Dr. Dieter Jasper, LL.M.

Brokerage costs for residential real estate

In some areas within the Federal Republic of Germany (e.g. in Berlin, Hamburg, Hesse) the practice of having the buyer pay the brokerage costs alone had become widespread. The federal legislator has now put a stop to this and orders (as is already customary in other parts of the Federal Republic) that the total brokerage costs incurred are to be divided equally between the parties to the main contract. This rule is referred to as the half-sharing principle (cf. in more detail Fischer; Die Verteilung der Maklerkosten bei der Vermittlung von Kaufverträgen über Wohnimmobilien, NJW 2020, page 3553 ff.).

With this regulation (see Law on the Distribution of Brokerage Costs of 12 June 2020, BGBl. 2020 I 1245) the legislator wants to avoid that de facto only the buyer - although he did not commission the broker at all - bears the brokerage costs. The seller is now to bear at least half of the costs - if he uses a broker (§§ 656 c - 656 d para. 1 sentence 1 BGB). Thus, the seller should already make sure that the brokerage costs are kept within reasonable limits.

In fact, this regulation is only applicable to brokerage contracts concerning the brokerage of purchase contracts for residential and single-family houses. A verbal brokerage contract is not sufficient. The brokerage contract requires text form (§ 126 b BGB). This means that the exchange of declarations by e-mail is sufficient. If this text form is not observed, the brokerage contract is void according to § 125 BGB, i.e. it has no legal effect at all.

This principle of half-division is a consumer protection provision (Bundestagsdrucksache 19/19203,20). The buyer must be a consumer. Whether the seller is a natural or legal person, e.g. a professional broker, is irrelevant for the application of this principle of halving.

If the broker acts for both the seller and the buyer, the broker's commission is to be divided equally between the buyer and the seller (§ 656 c para. 1 sentence 1 BGB). Agreements deviating from this are invalid (§ 656 c para. 2 sentence 1 BGB). In order to avoid circumvention of these regulations, the legislator has stipulated that the broker can only claim the commission from the buyer (should the seller have commissioned the broker) if the seller has in turn paid his share of the commission to the broker.

With these new regulations, party autonomy has been restricted in favour of the buyers of flats and single-family houses. This restriction is to the detriment of the brokerage industry. In the explanatory memorandum to this draft law, the federal government estimates that these new regulations will lead to a drop in turnover for estate agents of around EUR 75 million per year.

Author: Dr. Dieter Jasper

Düsseldorf, the 27 November 2020

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