The distribution of real estate agency fees between the seller and the buyer follows a precise legal framework, structured by the Hoguet law of 1970, supplemented by the Alur law of 2014 and the decree of January 10, 2017. These texts regulate both the contractual freedom of the parties and the transparency obligations imposed on professionals.
Basis for transfer taxes: the fiscal issue that listings do not show
The choice to charge the fees to the seller or the buyer does not change the overall cost of the transaction for both parties combined. However, it alters the basis on which the notary calculates the transfer taxes.
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When the fees are charged to the seller, they are included in the sale price stated in the authentic deed. The transfer taxes then apply to this total amount. The buyer pays higher notary fees, calculated on a basis that includes the agency commission.
Conversely, when the fees are charged to the buyer, the price stated in the deed corresponds to the net seller amount. The transfer taxes are based on this reduced amount. The difference can represent several hundred, or even several thousand euros, depending on the amount of the commission and the price of the property. This is a matter that directly relates to the fees charged to the seller according to the Alur law and their concrete consequences on the acquisition cost.
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This fiscal mechanism explains why some notaries advise buyers to take the fees upon themselves, even when the initial mandate provides for billing on the seller’s side.
Display of fees in real estate listings: the rules of the 2017 decree
The decree of January 10, 2017, tightened the transparency obligations introduced by the Alur law. Real estate agents must adhere to a precise visual hierarchy in drafting their listings, whether they are displayed in windows, online, or in the press.
Each listing must include:
- The sale price including fees, displayed prominently (most visible characters)
- The total amount of fees expressed as a percentage of the sale price
- The explicit mention of the party responsible for these fees (seller or buyer)
An agent who displays a “net seller” price without mentioning the amount of their commission or specifying who pays it is subject to sanctions from the DGCCRF. The listing must allow any reader to identify the real cost of the acquisition even before contacting the professional.
This obligation applies to all dissemination supports, including online listing portals. The agent cannot rely solely on a mention in small print or a reference to their fee schedule displayed in the agency.
Fee shifting: common practice, real legal risk
Fee shifting involves changing the distribution of fees during the marketing process. The typical case: a sales mandate signed with fees charged to the seller, followed by a search mandate proposed to the buyer once identified, to transfer the commission to their charge.
This practice raises two distinct legal issues.
Validity of the subsequent search mandate
The Hoguet law requires that any mandate be prior to negotiation. A search mandate signed a few hours or days before the compromise can be annulled by a judge. Court decisions have invalidated mandates signed less than 24 hours before the parties’ agreement, considering that the agent did not have the material time to execute the search mission.
Without a valid mandate, the agent loses all right to remuneration. The risk is not theoretical: it has been sanctioned several times by the Court of Cassation.
Qualification as misleading commercial practice
A systematic fee shift can be analyzed as a misleading commercial practice by the DGCCRF. The buyer discovers a displayed price, then is offered a higher amount that includes fees not mentioned in the initial listing. The advertising misleads about the real price of the property.
The mandate also cannot be unilaterally modified by the agent during the marketing process. Any change in distribution requires an amendment signed by the parties or a new mandate. Without this formalization, the agent’s remuneration is contestable.
Negotiation of agency fees: what the regulatory framework has allowed since 2022
The decree of January 26, 2022, brought a clarification that many sellers and buyers are unaware of: agency fees are explicitly negotiable downwards. This mention must appear in the information communicated to clients.
The fee schedule displayed in the agency and on the listings constitutes a ceiling, not a fixed amount. The real estate agent can accept a commission lower than that initially planned, whether the fees are charged to the seller or the buyer.
In practice, this negotiation often occurs at the time of signing the mandate or during discussions about the sale price. Some agents prefer to lower their commission rather than lose a mandate or see a sale fail due to a price gap.
Field feedback varies on this point: in tight markets where demand exceeds supply, the room for negotiation remains low. In areas where properties remain on the market for a long time, discussions about fees are part of the normal marketing process.
The Alur law and its implementing texts have not capped the fees of real estate agents for sales, unlike rentals where caps per square meter exist. The amount of the commission remains free, only its transparency is regulated.
A seller who signs a mandate with fees charged to them should therefore compare the schedules of several agencies and negotiate before committing, rather than focusing solely on the distribution between the parties.