Real estate agents – the ‘Makler’

There has been a recent change in regulations in Germany regarding fees on property. It used to be that most of the properties listed online were from real estate agents and therefore included an additional fee called the ‘Provision’ which was the equivalent of 2.38 times the rent (the .38 was to cover the 19% VAT). The aim of every house hunter of course was to find the small number of privately listed properties and avoid this massive surcharge.

So the government has stepped in and changed the rules. Since 2015, the cost of the Makler (real estate agent) can not be passed on to the tenant and must be covered by the person engaging the agent’s services. There is a €25,000 for breaking the rules.

So now, the market has become more difficult. There were expectations that this would not result in price inflation in the market, but unfortunately this is exactly what is happening in crowded markets like Frankfurt. Landlords have to either list and manage the property themselves or absorb the cost of the Makler. Many are managing the property themselves but this makes it very hard for house hunters to get in to a property.

And the agents are still there but the game has changed. If anything it is a positive trend in that they provide a service to people who need their support. That means that if you are at a disadvantage in the property search, a Makler will now be your best friend in finding a place to stay. Reasons for a disadvantage may include:

  • you aren’t physically in Frankfurt
  • you don’t speak German
  • you are a student
  • you have a low income (under €1500 net monthly)
  • you have a pet
  • racism (unfortunate, but it is a factor)

When engaging the services of an agent or Makler, never pay a fee before the contract is signed, do not sign exclusivity agreements, and do not sign anything before all conditions are agreed in writing.

If you are looking for an English-speaking Makler/agent in Frankfurt, then a safe choice is Tim Choi (timimmobilien@gmail.com or +49 (0) 176 41456100) and let him know I sent you 🙂

The standard fee for Maklers is still 2x monthly rent +19% tax, or 3x monthly rent + tax for commercial rentals. If you are buying property then the cost is 5% of property value +19% tax.  For a list of all registered agents, have a look at www.rdm.de.

 

 

 

 

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