The commissions linked to the purchase and sale of real estate are too high and opaque in France, pointed out the Competition Authority on Wednesday, calling for better supervision of professionals in the sector.
The average commission rate applied in France was in 2022 5.78% of the sale price, against nearly 4% in the rest of the European Union, recalls the Authority, based on several studies. In 2022, the government had asked the Authority to look into the subject in order to respond in particular to the evolution of the real estate brokerage market – the support of actors allowing a seller and a buyer to reach a transaction.
The competition policeman has identified several problems, including the opacity of the commission rates chargedthe asymmetry of information between the various players and the fact that they are not all subject in the same way to the Hoguet law, which has governed real estate sales since the 1970s.
Costs that weigh on French consumers
These difficulties are linked in particular to the emergence of new professions in real estate (online agencies, real estate coaches, agents, etc.), not subject to the same legal provisions than traditional real estate agencies, but which can be mandated by agencies. Their services are then included in the commissions, sometimes in an opaque way.
The high costs weigh on French consumers, pointed out the Competition Authority in its report, submitted to the Minister of the Economy last week and published on Wednesday. If the commission rates of intermediary professionals in France were brought back to the average of the European Union, an annual gain of nearly 3 billion euros could be released for the benefit of households, considers the Authority in this opinion, which has the value of recommendation.
The Authority proposes a reform aimed at give households the choice to determine what they want to do themselves and what they want to delegate to intermediaries, to regain control of their budget, explains Thibaud Verg, vice-president of the Authority.
The report therefore suggests, in particular, establishing an exhaustive list of the services rendered by the professionals, to standardize the rules for displaying ads, in particular online, or to make public real estate data already held by notaries on sale prices and commissions. All with the aim of reducing the asymmetry of information and clarifying the scope of the Hoguet law, underlines Benot Hoguet, the president of the Competition Authority.
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