Selling a villa Broker commission: How high?

Selling a villa estate agent commission in Germany – How high is the estate agent commission when selling a villa? Whether Berlin, Hamburg, Munich or Düsseldorf, here is a guide to the typical commissions charged by real estate agents in the high-price segment.

Negotiation of the broker’s commission

In contrast to the letting of real estate, where the ordering principle applies, i.e. the estate agent’s client must pay the commission, the situation is different for the sale of real estate. When selling, the estate agent’s commission can be freely negotiated between the seller and buyer. This offers scope for individual agreements that can meet the interests of both the seller and the buyer.

“When selling, the broker’s commission can be freely negotiated between the seller and buyer.”

No legally defined commission amount

An important aspect to consider is that the amount of commission for estate agents in Germany is not set by law. There are therefore no maximum commission levels that may not be exceeded. This freedom leads to a wide range of commission rates, depending on the region, the value of the property and the negotiation between the parties.

“The commission for estate agents is not set by law in Germany. So there is no maximum commission amount.”

Typical estate agent commission for house sales

Despite the lack of legal requirements, estate agent commissions are often based on the standard rates of the respective federal states’ estate agent commissions. For properties under 1 million euros, the typical commission is between 5.95% and 7.14% including VAT. These rates can be used as a guide when estimating the costs of selling a villa.

Does the commission remain the same for more expensive properties?

Reduced commission for high-priced properties

For properties with a value of more than 1 million euros, the broker’s commission is usually reduced. The commission is often in the range of 4-5%. For even more expensive properties, such as those over 10 million euros, the commission can drop further to 2-3%. From a sales price of 50 million euros, the rates are even 1-2 %. This staggered adjustment of the commission rates takes into account the fact that for very expensive properties, an appropriate remuneration can be achieved for the estate agent even without a proportionally high percentage.

• < 1 million euros, typically 5.95% to 7.14% (incl. VAT)
• > 1 million euros, typically 4.76 to 5.95 %
• > 10 million euros, typically ~ 2.38 to 3.57 %
• > 50 million euros, typically ~ 1.19 to 2.38 %

Most deals are done with real estate agents, in Germany and cities like Berlin over 80%. Here are 3 reasons why many people work with real estate agents:

Why is an estate agent worthwhile when selling real estate?

1. Time saving
2. Discretion in sales
3. Background check of interested parties

Time saving

Selling a property requires a considerable amount of time, from preparing the documents to organizing viewing appointments and negotiations. An estate agent takes on these tasks and relieves the seller considerably by handling the entire sales process professionally and efficiently.

Discretion in sales

Many sellers value discretion when selling their property, whether for personal reasons or business considerations. An estate agent can help to keep the sales process discreet by filtering potential buyers and only contacting serious interested parties. In addition, an agent’s experience and expertise can ensure that sensitive information about the property and the sales process is kept confidential.

Background check of interested parties

An experienced estate agent has the necessary resources and knowledge to thoroughly vet potential buyers. This includes, among other things, credit checks to ensure that they are serious prospects, as well as checking their intentions to buy to avoid wasting time with unreliable prospects.

Nothing is worse than an almost perfect deal that falls through just before the notary and everything starts all over again.

That means…

The commission is usually based on the typical rates of the respective federal states and is often reduced for high-priced properties. This makes it possible to keep the cost of the sale within reasonable limits, while at the same time using the services of a professional estate agent to ensure the best price and the smooth completion of the sale.