Other countries, other customs I Part 2

Buying a property in the USA is much quicker

“In my opinion, the real estate business is assigned greater importance as an economic sector in the USA than in Germany,” remarks customer service advisor Kirk Sylvester, who has worked as a real estate agent in New York City and Berlin. The statutory provisions have been streamlined in the USA. It is very easy to buy and sell properties there. Much easier than here in Germany. But how does this work exactly?

 

“If you want to sell a property in the USA, you enter into a contract with a real estate agent who then endeavours to sell your property,” Sylvester explains. At the same time, all real estate agents in New York can show their clients any property that is available anywhere in the city and to sell it in agreement with the commissioned agent. This is known as split commission. The real estate agent, who entered into an agreement with the property owner, and the agent, who sells it to his or her client, split the commission. In accordance with the RLS universal co-brokerage agreement, it is mandatory for every New York agent to agree to split the commission.

 

In Germany, things are different. Here, brokers are not obliged to split commissions. However, the trend is on the rise. Owners may also contract several real estate agents to sell their property at the same time. However, it is up to the agent to decide whether and to what extent he or she wishes to engage in real estate activities.

 

This is different if the estate agent has concluded a ‘qualified exclusive contract’ (qualifizierten Alleinauftrag) with the property owner, in which case, as the only agent entitled to sell the property, every effort to do so much be made. The most common form of contract is the ‘simple contract’(einfache Alleinauftrag), although, in this case the owner may still choose to sell his property privately, without commission and without the help of the real estate agent. This is not the case with the ‘qualified exclusivity contract’.

 

In general, the regulations in the USA are geared more towards meeting the demands of a fast-track market. “In the USA, buyers can immediately sign a purchase agreement. And they can immediately pay by cheque,” Sylvester adds. In Germany, there is the mandatory ‘14-day reflection period’ if a private individual buys a property from a company or vice versa. In this case, the buyer must wait for two weeks before the purchase agreement can be notarised. The legislator thus seeks to give the private individual enough time to examine the purchase agreement in peace and quiet or to have it checked by an expert.

 

In Germany, it can take weeks before a sold property is paid. Before the notary summons the buyer to settle the purchase price, certain requirements need to have been met. Among other things, a priority notice protecting conveyance of ownership in favour of the buyer needs to have been entered by the Land Registry (Grundbuchamt), so that the property cannot be sold on to anyone else in the meantime. This can take time. However, it is possible to make an immediate payment in Germany by means of a notary public’s escrow account.

 

In this case, the purchase price is transferred to the notary public who passes it onto the seller once the specified prerequisites have been met. Once the purchase price has been received by the notary public, the buyer is handed over the keys to the property. Since a fee is due for this kind of money transfer, few clients make use of this option. In the USA, buyers and sellers do not even need to go to a notary. It is suffcient to have a real estate attorney.

 

Read more on the subject:

Real Estate Agent in New York an Berlin

Mandatory trainings for real estate agents

Other countries, other customs I Part 1

 

 

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