New RD real estate mediation agreements between consumers and businesses
On Nov. 6, 2023, the Royal Decree of Sept. 24, 2023 concerning the use of certain clauses in the real estate brokerage agreements concluded between businesses and consumers.
This includes consumers who use a real estate broker to sell or rent a property. These agreements must meet certain conditions.
The RD replaces the "Freya RD" (RD of Jan. 12, 2007 on certain clauses in real estate brokerage agreements), which will be repealed on Feb. 1, 2024.
The Freya RD introduced further rules on clauses in brokerage agreements of real estate agents and stipulated the minimum conditions that must appear in a brokerage agreement and prohibited a number of abusive clauses.
However, the legislative landscape has changed significantly since 2007. Consequently, the Freya RD also needed an update.
The following is a brief explanation of the contents of the new RD:
- Wider scope of application
The RD no longer applies only to real estate brokers. Every company that mediates in real estate professionally falls within its scope. This includes architects, surveyors, etc.
- 14 days right of withdrawal
In principle, the consumer has 14 days to withdraw from the contract. There is an exception to this, namely (1) if the consumer gives his express consent to immediate performance of the contract and (2) the consumer expressly acknowledges that he loses his right of withdrawal in case of full performance of the contract during the withdrawal period. This situation occurs, for example, if a valid candidate tenant has already been found during the withdrawal period.
- Transparency obligation
The company must transparently disclose its mandate and the extent of its authority. If the company has the authority to negotiate the price with the prospective buyer, the limits of this granted negotiating authority must be clearly agreed upon. The contract should also clearly state whether the company is mandated to enter into a contract in the name and on behalf of the consumer. In addition, the price desired by the consumer should be included.
- Information obligation
The consumer should be informed at least once a month on the status of the mediation assignment. E.g. how many interested parties were there, how many visits were made, what were the main reactions and comments?
- Certificates
A list of required certificates related to the sale or rental agreement must be attached to the agreement. E.g. soil contamination, energy performance certificate, inspection certificates of appliances, ...
- Exclusivity
The agreement should state whether or not the company enjoys exclusivity and how long the exclusivity lasts. For example; in addition to the company itself, may the consumer search for a prospective buyer and enter into a purchase agreement with it?
- Duration of the agreement
In the case of a fixed-term contract, the consumer should know how long he is bound by the contract; in the case of an indefinite term, the notice period is a maximum of 2 months.
- Compensation option for the company outside the contract
If a prospective buyer or renter enters into an agreement directly with the consumer outside the company, the company is entitled to the compensation provided for in the agreement. To this end, the company must be able (1) to prove that it has introduced this candidate and (2) this possibility must be provided for in the agreement.
When the mediation assignment has not led to the conclusion of a contract and the property has thus not been rented or sold, the company will provide the consumer with a list of candidates who showed specific interest. The company is entitled to an additional compensation if (1) the property is sold or rented to a candidate from the list within 6 months after the end of the contract and (2) the contract provides for this possibility.
Beware because the provisions of the new RD are mandatory law. Therefore, they cannot be deviated from by contract.
Therefore, it is important to adapt the newly concluded contracts to the requirements of the new RD. Indeed, contractual clauses contrary to these provisions are prohibited and punishable by the nullity penalty.
The RD enters into force on Feb. 1, 2024, and will apply to all contracts entered into from the date of entry into force.
Please do not hesitate to contact us for further questions or info at info@bannister.be or 03 369 28 00
