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Supplementary fees - Vivre à Paris, a real estate agency “unlike any other” - 01.44.54.97.97

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VAP informes you

Supplementary fees

Supplementary fees to be added to the purchase price of the apartment.

 

All parties should be aware that the seller of a property is not aware of the total amount to be paid by the buyer. In addition to the purchase price of the property, the buyer must also pay fees of the notaire, as well as, in most cases, the commission of the intermediary (i.e. real estate agent or broker).

  1. Commission of the intermediary (broker, real estate agent)
  2. The amount of the commission
  3. Notaire fees
  4. New properties

Commission of the intermediary (broker, real estate agent):

Many transactions are conducted directly between the buyer and the seller. More often, the seller prefers to entrust the “sales mandate” to an intermediary charged with finding potential buyers and manage the transaction. The sales mandate is nothing more than a directive entrusted to the real estate agent, formalized by a written contract.

A buyer can also engage an intermediary to find a property. In this case, he would sign a search or purchase mandate.

As with any other contract, the mandate must state the mission, the duration, the conditions to perform and the compensation to be made to the intermediary.

The mandate can be “exclusive”. In this case, the directive to sell the property is excusive to the intermediary. The seller cannot directly execute on the transaction, even if he has found the purchaser himself. In addition, he is not permitted to market the property through another intermediary or real estate agent. The maximum duration of this type of sales mandate is fixed for a renewable period of three months, at the end of which the seller must cancel the contract by registered, return receipt letter within fifteen days of the expiration of the term.

When the sales mandate is “simple”, the seller is also permitted to finalize the transaction on his own or engage the services of another intermediary through a simple sales mandate. In general, the contract is for a term of three to six months during which the seller cannot cancel the sales mandate.

Finally, the sales mandate can be “semi-exclusive”.In this circumstance, the seller can finalize the transaction if he finds a buyer on his own, however, there will be only one real estate agency representing the sale. This solution seems to be the most practical. In the case where the seller finds a buyer himself, he can have the real estate agent handle the signature of the sales agreements.In this case, the commission is often reduced by half.

More often, a potential buyer who visits a property with an intermediary must sign a document known as the “bon de visite” (proof of visit) by which the buyer is required to use the services of the real estate agent with whom he has visited the apartment in order to finalize the transaction.

If the buyer concludes the transaction with another intermediary or directly with the seller, the initial broker or real estate agent can theoretically pursue legal action and obtain punitive damages with the proviso that his actions resulted in the loss of commission for the intermediary.

The amount of the commission:

When the intermediary is a real estate agent, the amount of the commission is liberally fixed by agreement between the two parties. The commission varies with respect to the sales price of the property ranging from 10% to 5% (properties in excess of €1 million). It is required that the rate card be posted in the window and throughout the office of the real estate agency.

When the transaction is brokered by a notaire, the amount of the commission is fixed by regulations.

Generally, the commission is paid at the signature of the final sales agreement. When the conditions included in the initial contract have not been fulfilled (inability to obtain a mortgage, etc.) the commission is not due, except the fault of the mandate or of the other party.

From a financial standpoint, it is more prudent the mandate state that the commission is at the charge of the buyer, who should there pay it directly to the intermediary. Conversely, the commission should be integrated as part of the purchase price and the buyer will be responsible for the fees associated with that commission.

Notaire Fees:

The notaire fees include the amount payable to the notaire for his work, the reimbursement of the fees for additional services provided by him and the taxes payable to the public tax authority.

The services of the notaire paid in conjunction with his fees, which the amount is proportional to the sales price.

The notaire fees correspond to the various services that he provides with respect to the administration of the transaction: verifying the title deed, the land registry, etc. The fees are regulated through every aspect of the process. The total amounts of these fees are dependant upon the type of transaction (mortgage, cash, etc.).

The notaire may require the services of third-party experts on behalf of his clients. These expenses are to be refunded by the buyer.The notaire fees also include the registration fees imposed and paid to the Public Treasury. The registration fees are applied to the sales price, as well as the “additional charges to the sales price” borne by the buyer.

Example: when the buyer pays the entire property tax, the pro rata share paid by the previous owner for the period prior to the sale is subject to registration fees.

The intermediary (broker, real estate agent) fees are not subject to the registration fees when the mandate expressly states that they are the charge of the buyer.

For an historic or old property, the taxes amount to 5.09% of the purchase price. The buyer must also pay the mortgage guarantee or “hypotheques” (.10% of the purchase price).

New properties:

A property is fiscally considered new when it purchased on specification (not yet constructed), or when it is resold by the first time home buyer less than five years after it’s construction.

The sale of a new property is not subject to the classic registration fees or taxes, but the value-added tax (VAT) at a rate of 19.60%.

When a new property is resold by its first buyer, it is he who can deduct the value added tax payable at the time of the purchase from the VAT collected at the time of the second transaction. If the difference is negative, the Treasury refunds the overpayment.

The sale is also subject to a land publicity tax (TPF) of .60% on the sales price not including tax, of which the state tax is deducted equal to 2.5% of the amount of the TPF is added.

The proportionate fees of the notary are reduced when the property has never been inhabited, and when it is part of a multiple dwelling unit (MDU) of more than 10 units.

The reduction is 20% for an MDU from 11 to 24 units, 50% for 25 to 99 units, two-thirds for 150 to 499 units and 2/3 above 500 units.

In conclusion, the fees known as “notaire” fees and the agency commission will vary depending upon the value of the property. In all cases, in choosing the right professional, you will be well informed and represented through the various stages and be made aware of the all the necessary requirements. And it will be properly indicated in the initial sales agreement.

Ce document issu de Droit-Finances.net (droit-finances.commentcamarche.net) est soumis au droit d’auteur. Toute reproduction ou représentation totale ou partielle de ce site par quelque procédé que ce soit, sans autorisation expresse, est interdite.

 

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