German Court Rules Unequal Realtor Fees for Buyers and Sellers Invalid

The Federal Court of Justice clarifies equal fee-sharing rules for single-family home transactions and addresses key legal questions.

The Federal Court of Justice (BGH) ruled that real estate agent fees for single-family home transactions must be equally split between buyers and sellers if the agent represents both parties.
Contracts that impose unequal commission fees on buyers and sellers are deemed invalid, leaving agents without compensation in such cases.
The court clarified the definition of a single-family home, ruling that minor additional uses, such as a small office or garage, do not disqualify a property from being classified as such.
The ruling applies even when a third party, such as a seller's spouse, hires the real estate agent, emphasizing consumer protection against unfair costs.
This decision provides greater legal clarity for real estate transactions, particularly regarding fee structures and property classifications.