In the modern real estate market, transactions between citizens are rarely concluded without the help of third parties.
Most contracts are drawn up through the mediation of real estate agencies , which resolve all organizational issues.
For such services, agencies charge a certain fee .
When looking for a residential property for the purpose of renting, it is important to clearly understand what a commission is when renting apartments , how many times it is paid and how it is calculated and paid.
What does commission mean when renting a home?
The term “commission” means monetary compensation in return for services provided.
In the real estate market, agencies receive a commission for the following services they provide:
- Selection of housing options that meet the conditions stated by the customer. In this case, the future tenant acts as the customer.
- Housing showing . A showing means a visit to the location of the property with a preliminary agreement on the time of the meeting between the agent, the tenant and the landlord (owner of the property). After arriving on site, the realtor makes a presentation of the apartment, showing the client all the advantages of this option.
- Conduct of negotiations . An agency employee must not only show the object, but also resolve possible controversial situations. For example, persuading the landlord for a small rent reduction. The realtor must conduct negotiations in such a way that the parties ultimately come to a compromise and the deal goes through.
- Drawing up and signing a contract . Agencies prepare a lease agreement indicating the details of both parties on the organization’s letterhead. At the appointed time, the parties meet with the agency representative at the agreed location (this can be the rental object itself or the company’s office) and sign the agreement.
Who should pay the commission?
The commission is an amount that is transferred to the realtor once, and, depending on the rules of the agency and the agreements reached, it is paid either by the landlord or the tenant.
However, this nuance should be clarified “on the shore”.
There is a tradition in the Russian real estate market according to which the commission fee becomes the lot of the tenant. True, this rule applies in cases where housing is rented, which is more likely to belong to the economy (now “standard”)
or comfort class; the commission for housing of a higher category is often paid by the owner.
As for luxury real estate with a significant rent, it is paid in the vast majority of cases by the owner of the property. However, in some cases a decision is made to split the commission fee between both parties to the transaction. There is another, simpler rule: the commission is paid by the one who contacted the real estate agents.
What is an advance?
Advance payment is a preliminary payment that allows you to secure the property you like.
Often people find a suitable option for their future rental that meets all the necessary requirements.
This includes price, location, living conditions and other characteristics of the property .
But it is not always possible to complete a transaction in the near future. For example, there is no financial opportunity to pay the first month’s rent or pay a commission to the agency.
Types of commission
Commission can be paid to the agency in two ways:
- Employer . The most common scheme is when the commission for intermediary services is paid by the future tenant of the premises. In this case, the owner of the property does not pay anything. Payment of commissions is made directly upon conclusion of the contract . The client pays a commission for the selection of an apartment carried out by the agency, the showing, the prepared lease agreement,
- Owner . This option is most often used by owners who want to rent out their property in the shortest possible time . In this case, the owners enter into an agreement with intermediaries and pay them a commission in the amount that the realtors would have received from the employer if they had chosen the first method.
- Thus, having received a reward from the owner of the property, the agency puts his apartment up for rent, indicating that it is rented out without a commission for the tenant . Such a move allows you to arouse increased interest in the property and rent it out as soon as possible . This method is beneficial for all parties , since it allows the owner to resolve the issue as soon as possible, the agency to make a quick profit, and the employer to save money. The low popularity of this option for paying a commission is due to the fact that in most cases, owners still prefer to lose time but save money.
Is it possible to rent an apartment without the services of a real estate agency?
It is possible to rent a home without realtors, but this is not an easy task
Of course, some people who have a lot of time or want to save money have a desire to find rental housing on their own.
It must be said right away that this is possible, but it will take considerable effort.
Some landlords specifically post advertisements in which they write that they rent out housing without intermediaries or commissions. This means that they do not use the services of realtors, and when contacting them, they will not have to pay additional money.
Expert opinion
Valiullova Antonina
Expert of the site pravozhil.com
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Experience shows that the real estate rental market is rapidly being taken over by various types of scammers. Thus, cases have become more frequent when premises are re-let by unscrupulous tenants who are not owners. Currently, a prudent citizen is trying to protect himself from all kinds of problems, including entrusting the search for tenants to professionals, by virtue of a concluded agreement.
We advise you to carefully double-check advertisements for housing rentals that indicate the absence of intermediaries. You should always remember that the miser pays twice.
Size
Each agency has its own interest rate for services provided and may vary depending on the conditions of a specific transaction (terms of service provision, level of object).
Typically, a competitive rate is 50% of the rental payment .
That is, the employer pays the agency half the monthly rental price.
The attitude of a particular agency towards a given owner plays a big role in determining the interest rate .
If the apartment is rented through a realtor directly from the owner of the apartment , then the rate will be around 50% .
If the property initially located in the database of another company and the realtors act by agreement, then the client is actually forced to pay a commission to two agencies .
In this case, the rate can rise to 80-100% . This is explained by the fact that the first company takes 50% of the provided property from its database, and the agency working with the client seeks to take the same rate from the rental payment.
From this point of view, it is beneficial for employers to consider only facilities directly provided by their chosen agency .
Payment procedure
The transfer of monetary reward must be made after the following conditions are met:
- Study of documents confirming ownership ,
- Reconciliation of receipts for utility bills (it is important to ensure that there are no rent arrears at the time of concluding the contract),
- Obtaining keys from an object.
The amount of the commission paid must appear in the rental agreement prepared by the agency for the parties.
Registration of the contract and pitfalls
When concluding a contract, it is important to pay attention to the presence and accuracy of the following points in the document:
- Subject of the agreement . In this case, it is a real estate property. Its characteristics must be - exact address, area, state of repair, furnishings present. Such a description will eliminate the likelihood of future controversial situations . For example, mentioning in the contract the fact of breakdown of furniture or plumbing will exclude in the future the possibility of the owner filing claims against the tenant,
- Amount of payment . The amount of the monthly payment is indicated,
- Duration of the contract , conditions for its termination . Typically, a contract is concluded for an indefinite period with the possibility of its termination at the initiative of one of the parties. But if the owner or tenant is limited by a specific period, then the contract can be drawn up for the appropriate period of time,
- Details of the parties . The document indicates the passport and contact information of the landlord, tenant and agency details .
Read our article on how to correctly draw up an apartment rental agreement.
At the time of concluding the transaction, the lessor presents the following documents:
- Passport,
- Owner's document. Typically, the registration certificate
- Documents confirming the right to transfer ownership. For example, deed of gift, will, purchase and sale agreement, etc.
- Receipts for utilities, which should not contain any debts as of the current date.
The tenant usually presents only a passport . No other documents are required.
The agency provides a prepared rental agreement .
When concluding a lease transaction, you need to pay attention to the following pitfalls:
- Number of owners . If the object belongs to several people, then disagreements may arise between them, which is unfavorable for the employer,
- Owner behavior . If, during the conclusion of a transaction, the owner is noticeably nervous or behaves aggressively, he should refrain from signing the contract,
- Neighbours . It is advisable to get to know your closest neighbors before signing a contract, since troubled residents in the neighborhood can greatly spoil the quality of life.
Real owners
The “real owners” scheme is aimed at non-conflict people. After signing the documents, an indignant person appears on the threshold, introducing himself as the owner of the property and harshly demanding those present to leave the premises.
In this situation, you don’t need to get lost, but demand the documents of the person who appears. Unless this is a previous scheme, the “owner” will not have the documents. Just insist on a legal investigation of the situation and offer to call the police.
Realtor's responsibility
From a legal point of view, a realtor acts as an intermediary and a source of information about the property.
The agency does not bear any financial obligations to employers and does not act as the insurer of the transaction.
At the time of conclusion of the agreement between the parties, the realtor confirms the fact that the owner has documents giving him the right to rent out the property, and the fact of transfer of funds in the amount of rent for the first month of residence.
Further fulfillment of the parties' obligations under the contract is regulated by the real estate agency only conditionally and if difficulties arise from a legal point of view, the realtor will not be held liable under the contract .
A standard agreement with a real estate agency for renting an apartment.
Real estate databases
Searching for suitable premises for rent can be done by viewing advertisements in the media
According to the general rules of the real estate market in our country, there is primary and secondary.
In the first case, housing in new buildings that has not yet been used for living and has just been purchased is given for rent.
In the second case, real estate objects are rented out, which are located in houses that have already been operating for some time.
Based on this, a database of real estate objects is formed. People who want to rent out apartments or houses turn to real estate companies or submit advertisements to various media.
Those people who want to rent housing can also receive services to find the necessary property through realtors, or view the media.
This is how real estate databases are formed.
It is important to know that those realtors who do their work professionally immediately buy up information, through their people in the media, or the entire circulation of newspapers.
There they look for new apartments or houses that they plan to rent out, negotiate with their owners, and then advertise on their own behalf.
