How are sellers paid

Broker commission & innovations in 2021 - questions & answers

3. Brokerage commission - new law: who pays when selling or buying in 2021?

The grand coalition agreed in August 2019 as part of the housing package that The seller and buyer should usually share the brokerage commission (bogus ordering principle). That should relieve "Law on the distribution of brokerage costs when brokering sales contracts for apartments and single-family houses" Especially real estate buyers in federal states such as Hamburg, Bremen, Berlin, Brandenburg and Hesse, as the buyers there had to bear the entire brokerage fee in the past.

The most important changes at a glance

Shared brokerage commission - when does the new law apply?

The The new regulation or division of the broker's commission has been in effect since23.12.2020. The draft law was adopted by the Bundestag in May 2020 and the law was promulgated in the Federal Law Gazette on June 23, 2020. Before it came into force, there was a transition period of six months, within which those affected could adjust to the new regulation.

Who has to pay the broker's commission under the new law?

There are three possible variants of commission agreements:

  • 1. The broker concludes a contract with the seller and buyer and agrees a double commission from the outset (§ 656c BGB).

This variant should be the rule. Than are Commission agreements only in the same amount possible: Seller and buyer each bear 50 percent of the broker's commission when buying an apartment or house.
Up until now it was possible in some federal states for one party, usually the seller, to agree a commission-free activity with the broker. The broker received his wages through a subsequent such agreement with the buyer, who bore the entire commission. However, since December 23, 2020, the broker would go away empty-handed with such an agreement, because the following applies: If the broker agrees on a free activity with one party, he cannot accept any brokerage fees from the other party.

  • 2. One party, usually the seller, enters into a contract with the broker and undertakes to take over the full commission. Afterwards, however, he gets back part of the commission from the buyer (§ 656d BGB).

With this so-called Passing on, the broker only represents the seller, but the buyer undertakes later in the sales contract to take over part of the broker's commission. In this case, the seller's share must be at least as high as that of the buyer: The seller must pay at least 50 percent of the brokerage fees, but he can also pay more.

  • 3. Only one party pays the broker's full commission, because even since December 23rd, 2020 there is no "compulsion" to double commission.

Two variants are possible here:

  • Agree broker and seller a pure internal commission, the seller pays the full brokerage fee of e.g. six percent of the purchase price plus VAT.
  • Also a pure external commission is permissible if the buyer issues a commission-based search order and the broker has not yet acquired the property to be purchased or has it at hand at this point in time.