In most markets the agent is paid by the seller or the developer. How the payment models differ, where conflicts of interest appear and eight questions to put to any agent in writing.
When you buy abroad, the person who shows you properties, speaks your language and sounds helpful is usually paid by someone else. That does not make them dishonest, but it decides whose interests the arrangement serves. This article explains the common payment models, where conflicts of interest appear and which questions bring them into the open. It is general information, not legal advice; rules differ by country and change.
The default: whoever instructs the agent pays
In many markets the seller, or the developer for a new build, instructs the agent and pays the commission. A guide to Spain describes the principle in one line: the person who gives the instruction pays, and there is no legally fixed rate. Cyprus guides likewise say the seller usually pays, but sources disagree on the rate (one tax note refers to a statutory 3% unless another rate is agreed in writing, a consumer guide says 3% to 5% is typical), so ask for the figure in the contract rather than relying on a rule of thumb.
Seller-paid does not mean free for you. The commission is part of what the seller needs to receive, so it ends up in the price. What it does mean is that the agent is paid for closing a deal on the seller's terms.
The rules are not the same everywhere:
- Italy. The Civil Code gives the agent a right to commission from each party when the deal is concluded through the agent's work, and court summaries say a buyer can owe the fee even if only the seller signed the mandate. The split is negotiable and should be written down at the start.
- Dubai. The regulator's forms separate the roles: one for the seller's broker, one for the buyer's broker and one for the sale memorandum that records the commission. For off-plan purchases, one broker guide says the buyer typically pays no commission because the developer pays the broker. Check on the official channels.
- France. According to legal summaries, the agent may collect the commission only once the sale is completed, and the written mandate should say who bears it. Elsewhere, check the same two points in your own contract.
The models you will meet
- Seller-side agent. Hired by the owner to sell. Legally and practically, the agent works for the owner, even if friendly to you.
- Developer-partner agency. Sells a developer's projects and is paid by the developer. It may show only those projects.
- Buyer-side (search) agent. You hire and pay under a written mandate. Useful, but ask whether the agent also takes a share from the seller or developer.
- Dual agency. One agency or person acts for both parties. Some consumer guides note that it can speed things up but creates a conflict: the agent cannot argue for a lower price and for a higher one at the same time.
Where the conflict shows up
- Steering. When commissions differ between projects, the agent is tempted to show the one that pays more. Consumer commentary on new-build markets describes this pattern.
- Own stock. Agencies that call themselves buyer advisers often have properties of their own on sale and recommend them first.
- Information. The seller's agent knows the seller's minimum price and must not tell you.
- Pace. Urgency ("another buyer is interested") serves the person paid on completion, not the person who should check the registers.
- Add-ons. Lawyers, mortgage brokers, currency services and insurers may pay referral fees. A Spanish press summary says agencies can charge for financing they recommend. See also the lawyer recommended by the agent.
Eight questions to ask in writing
- Who instructs you and who pays you?
- How much, in percent and in money, and when is it due?
- Do you act for the seller, for me or for both?
- Does your agency own, or have an exclusive on, any of the properties you show me?
- Are you paid more by some developers than by others?
- Do you or your agency receive anything from the lawyer, bank, currency or insurance firm you recommend?
- What is your licence or registration number, and where can I check it?
- What exactly will you do for me, and what will you not do?
A clear written answer is a good sign. A vague answer, or "don't worry about that", is information too. Check the licence yourself in the official register of that country, not through a link sent by the agent. See how to verify a developer abroad.
What this means for your decision
An agent can still be very useful: they know the stock, the neighbourhoods and the paperwork rhythm. The point is to use them for that, and to put the checks on price, title, planning and contract in the hands of someone who answers only to you. See one agent or one lawyer is not enough and notary or lawyer: who you need abroad.
FAQ
Is it a red flag that the agent is paid by the seller? No, it is the normal arrangement in many markets. It is a reason to hire your own lawyer and to compare prices independently.
Can I pay the agent myself and get better advice? Possibly, under a written buyer mandate, but ask whether the agent is also paid from the other side.
Is a commission of a few percent always the same wherever I buy? No. There is no common rate and some countries regulate it differently.
Should I sign the agent's form straight away? No. Read it first; see agent contracts and forms that bind you.
Independent help on your side
Independent help on the buyer's side, such as a lawyer you instruct directly or an adviser who tells you in writing how they are paid, closes the structural gap. D.H. Realting can coordinate independent local lawyers for you; ask any adviser, us included, how they are paid. This text is informational only and is not legal, tax or investment advice.