Anyone dreaming of a second home, an investment or a permanent move to Spain will, sooner or later, find themselves dealing with a local estate agent. Yet, in practice, misunderstandings and disputes about the commission still arise surprisingly often. A frequently asked question from buyers on the Costa Blanca or Costa Cálida is therefore: “”The estate agent has suddenly asked me to pay a percentage commission on top of the purchase price. Is this right?".
In this article, we explore the legal and practical aspects of Spanish estate agency law. We
examine who is liable to pay the fee, how the law and customary law operate, and at what point the
commission becomes effectively payable.
The basic question: who should pay the estate agent?
To understand who the committee is required to satisfy, we need to look at the fundamental principles
of Spanish contract law, in particular Article 1257 of the Spanish Civil Code
(Civil Code). This article stipulates that a contract gives rise exclusively to rights and obligations
arise between the parties who have signed the contract. It is not binding on
the views of third parties.
In the vast majority of cases, the estate agent acts on behalf of the seller. The seller approaches the
estate agency and signs a sales mandate setting out the commission percentage.
As you, the buyer, are not a party to this agreement, the estate agent cannot, from a legal point of view, simply
pass on the commission to you. In principle, the fee is borne entirely by the
the selling party.
Exceptions: when do you, as the buyer, actually pay?
There are situations in which the buyer may be obliged to pay an estate agent’s commission:
- Explicit search: If, as a buyer, you engage a buyer’s agent yourself and a
When you sign a search mandate, you will, of course, pay your own adviser for their services. - Double commission and regional customs: In certain regions or cities – such as, for example, in
Valencia city – is it customary for the commission to be split between the buyer and the seller?.
A professional estate agent should inform you in writing, prior to a viewing, of any commission obligations and ask you to sign a mandate or viewing confirmation in which these terms and conditions are clearly set out. If you have simply responded to an advert on a platform such as Idealista and have not signed anything, then in principle you do not owe any commission.
Be sure to listen to our podcast episode about ‘Cowboys’ in the Spanish property market.
No written contract: the role of customary law
Under Spanish law, the estate agency agreement is regarded as an atypical contract. The legislator
has not devoted a separate, detailed chapter to this, meaning that, in principle, freedom of contract applies (although regions such as Catalonia and the Comunidad Valenciana (set out specific requirements for mediation agreements).
If no binding written agreements have been made, the parties fall back on Spanish customary law
(customs and traditions):
- Fees: Since the 2009 Competition Act, fixed fee scales set by professional bodies (such as the API) have been prohibited. However, a commission of 3% to 5% (excl. VAT) of the final sale price is generally regarded as a market-standard guideline for sales. For lettings, this is usually equivalent to one to two months’ rent.
- Included expenses: Marketing costs, photography, advertising and travel expenses are deemed to be fully included in the commission. An estate agent may not invoice these costs separately at a later date, unless this has been expressly agreed in writing in advance.
When is the commission considered to have been definitively earned?
According to established case law of the Spanish Supreme Court (Tribunal Supremo), the estate agent is entitled to their fee as soon as they have brought the buyer and seller together and a mutual agreement has been reached on the property and the price. This moment is usually formalised by the signing of a reservation contract or a ‘contrato de arras’ (pre-contract of sale).
However, this entails a significant risk: if the sale subsequently falls through because you, as the buyer, change your mind without a valid legal reason or are unable to secure financing, the estate agent is, in theory, still entitled to their commission. After all, they have secured a valid ‘match’.
The situation is different where the sale is rescinded on the basis of a legitimate legal condition or a condition precedent (for example, in the case of irremediable planning-related defects or illegal defects in the property). In that case, the contract is not definitively performed and the obligation to pay commission lapses.
Tip: Ensure that the sales agreement or reservation contract explicitly states that the estate agent’s commission is only due and payable at the time the notarial deed (escritura pública) is signed at the notary’s office. This links the payment directly to the actual handover of the keys and the final payment of the purchase price.
Conclusion
Buying or selling property in Spain is a fantastic adventure, but it requires you to know the rules of the game. Never allow yourself to be talked into paying a commission without there being a clear legal basis or a prior written agreement to support it.
Are you unsure about a tenancy agreement you have been presented with, or are you dealing with a pushy estate agent?
The Confianz team is on hand to analyse your case thoroughly and to protect your interests in Spain to the full. Feel free to get in touch.
