Bumping an estate agent for their commission

A place for some light-hearted chat.
User avatar
mysty
Posts: 13872
Joined: Wed Feb 28, 2018 2:38 pm
Location: dep18 and 23
Has thanked: 1107 times
Been thanked: 1876 times

Bumping an estate agent for their commission

Post by mysty »

Think again :lol:

Seller Broke Contract with Estate Agent

Friday 04 September 2020

A seller sought to avoid payment of the sales commission to the agent, but had to pay up in the end.

In a recent case in the French courts, a seller entered into an exclusive contract with an estate agent for the sale of their property.

The contract stated that the client "shall refrain, during the term of the mandate, from negotiating either by himself or by a other intermediary, the sale of the goods designated on page 1 and undertakes to direct all requests which are addressed to him personally to the agent."

Under the penalty clause, in the event of non-compliance by the client they would be liable for a compensatory lump-sum equivalent to the amount of the remuneration provided for in the contract.

The duration of the contract was for a period of three months.

The agent published the sale details on-line, in an advert that was seen by the buyers, who knew the property and who made direct contact with the seller.

A subsequent visit to the property resulted in an offer by the buyer the following day for the sum of €180K, which was below the advertised sale price.

At the end of the three months the seller terminated the contract with the agent.

Several days later they signed a sale and purchase contract with the buyers, and completion duly took place three month later.

In court the sellers claimed they had informed the buyer that they had an exclusive contract with the agent, whom they also notified of the agreed sale. They also claimed they would have no interest in negotiating a sale at a lower price than that stated in the contract with the agent.

However, the court considered that having allowed the buyer to visit the property and make an offer, without the estate agent acting as an intermediary, was in breach of the exclusive contract they had with the agent.

They considered that from the short-period that elapsed between termination of the contract and signing of the sale agreement it was clear negotiations had been carried out between sellers and buyers in violation of the exclusivity clause binding the sellers to the agency.

Accordingly, the court decided that the seller should pay €7,000 in damages to the estate agent, corresponding to the amount of the commission provided for in the contract.

Taken from Frenchproperty.com
mysty1 the new up to date user friendly version for an enhanced user experience

treiziste
Posts: 2086
Joined: Tue Mar 20, 2018 7:29 am
Location: Tarn
Has thanked: 254 times
Been thanked: 347 times

Re: Bumping an estate agent for their commission

Post by treiziste »

Quite right too.

Some agents actually do a good job.

niemeyjt
Posts: 3641
Joined: Fri Apr 13, 2018 6:10 pm
Location: Lausanne, 87 and Suffolk
Has thanked: 93 times
Been thanked: 1054 times

Re: Bumping an estate agent for their commission

Post by niemeyjt »

With a fee of 7K on a 180K sale he got off light. Most of the agents we contacted regarding selling my father's house want 7K on a sale for less than half that.

As for doing a good job - I tend to disagree. Can anyone point out an advert with 1) good photos and 2) floor plans as are the norm with agents in other countries?

Le Démerdeur
Posts: 11856
Joined: Thu Mar 01, 2018 11:22 pm
Location: Picardie and occasionally Sussex
Has thanked: 2143 times
Been thanked: 1652 times

Re: Bumping an estate agent for their commission

Post by Le Démerdeur »

Is there a link to the French article that was translated from?

It seems cut & dried but the key info would be when the visit allegedly took place, it sounds like the judge has reduced their fees by some amount.

My agents in the UK are charging me 1% which I did not try to negotiate down as it seemed such a bargain compared to what I am now used to, all the photos, floorplans etc that NiemeyJT mentions plus advertised on platforms like Rightmove which cost money and an individual cannot access. Were there platforms equally good and regarded as "Go To" by the French it would take away some of the begrudgement of seeing the property on LeBoncoin with poor photos and often the minimum number for a free listing.

From all the info that I have garnered over the years I work on 8% frais d'agence for a property of €100k rising sharply for lower priced properties and dropping a small amount as they get more expensive & rarely under 5%

I had to ask as I could not remember but when I bought my UK property in 1986 UK agents fees were 2 - 2.5% and have come down over the years with competition.

User avatar
mysty
Posts: 13872
Joined: Wed Feb 28, 2018 2:38 pm
Location: dep18 and 23
Has thanked: 1107 times
Been thanked: 1876 times

Re: Bumping an estate agent for their commission

Post by mysty »

niemeyjt wrote:
Fri Sep 04, 2020 5:11 pm
With a fee of 7K on a 180K sale he got off light. Most of the agents we contacted regarding selling my father's house want 7K on a sale for less than half that.

As for doing a good job - I tend to disagree. Can anyone point out an advert with 1) good photos and 2) floor plans as are the norm with agents in other countries?
Your in France sir. ;) we send out floor plans but we are not estate agents.
Estate agents pay almost 20% of the commission in tva then knock off 35% tax and then social charges.
Not a lot left.
mysty1 the new up to date user friendly version for an enhanced user experience

Le Démerdeur
Posts: 11856
Joined: Thu Mar 01, 2018 11:22 pm
Location: Picardie and occasionally Sussex
Has thanked: 2143 times
Been thanked: 1652 times

Re: Bumping an estate agent for their commission

Post by Le Démerdeur »

The individual elements of what you say are correct but the presentation of them give a very misleading impression Mysty.

Yes they are liable for 16.66% of their TTC invoice in TVA but that is offset by TVA reclaimed on all their business expenses, vehicles, rent, pretty much all their expenses except salaries, if their profits are low as you infer then the lower they are (more expenses) the less TVA they pay net.

They do not pay 35% taxes plus social charges on the remainder of their commission after TVA deducted, they pay them on their gross profit after expenses and salaries including their own on which they will pay charges patronales.

I am not disputing that all businesses pay a lot of taxes in France compared to other countries.

Le Démerdeur
Posts: 11856
Joined: Thu Mar 01, 2018 11:22 pm
Location: Picardie and occasionally Sussex
Has thanked: 2143 times
Been thanked: 1652 times

Re: Bumping an estate agent for their commission

Post by Le Démerdeur »

Sending out floorplans! - how unprofessional :lol:

After the Storm 2
Posts: 1795
Joined: Wed Jul 08, 2020 12:42 pm
Has thanked: 894 times
Been thanked: 699 times

Re: Bumping an estate agent for their commission

Post by After the Storm 2 »

niemeyjt wrote:
Fri Sep 04, 2020 5:11 pm
With a fee of 7K on a 180K sale he got off light. Most of the agents we contacted regarding selling my father's house want 7K on a sale for less than half that.

As for doing a good job - I tend to disagree. Can anyone point out an advert with 1) good photos and 2) floor plans as are the norm with agents in other countries?
No floor plans but I’ve randomly picked an advert out for you. Good photos, all of the important information clearly listed along with plenty of additional information given in a format that makes comparisons easy. Scroll right down and you will find info about the area too.

https://www.stephaneplazaimmobilier.com ... 0000&sort=

Le Démerdeur
Posts: 11856
Joined: Thu Mar 01, 2018 11:22 pm
Location: Picardie and occasionally Sussex
Has thanked: 2143 times
Been thanked: 1652 times

Re: Bumping an estate agent for their commission

Post by Le Démerdeur »

I would expect them to be the best of the bunch and their commissions are amongst the lowest but when the others are so médiocre there is not the pressure to be at the top of their game.

Good photos but none of the outside, that may be deliberate if its really moche but its something that people would really want to see, maybe not put them up front but later on or in a seperate dossier.

Actually the terrace picture is outside & well done.

5.75% on €305000 though! :o

niemeyjt
Posts: 3641
Joined: Fri Apr 13, 2018 6:10 pm
Location: Lausanne, 87 and Suffolk
Has thanked: 93 times
Been thanked: 1054 times

Re: Bumping an estate agent for their commission

Post by niemeyjt »

Le Démerdeur wrote:
Fri Sep 04, 2020 7:05 pm
I would expect them to be the best of the bunch and their commissions are amongst the lowest but when the others are so médiocre there is not the pressure to be at the top of their game.

Good photos but none of the outside, that may be deliberate if its really moche but its something that people would really want to see, maybe not put them up front but later on or in a seperate dossier.

Actually the terrace picture is outside & well done.

5.75% on €305000 though! :o
No outside photos is another bug-bear. Agree. For Dad's house they did take one - but it was done by same person who did the diagnostics.

As for your UK sale - our agent has quoted 0.75% on a £290K sale but 1% seems to be the norm around here too.

Post Reply