The initiative of Más Madrid to limit the commissions of real estate agencies in the Community of Madrid raises an interesting debate. What is the target value of a professional real estate service?

If you search on the Internet or ask ChatGPT, you will see that there are all kinds of prices, from a fixed price of 1,500 € to a percentage that can reach 10%. How to order such a wide range of options?

First: probably, the added value of each of these services will be proportional to what you pay. The question we must ask ourselves is: "What are my needs?" Hiring a professional to carry out legal and administrative checks to avoid unpleasant surprises is perfectly valid. You can choose to invest the time and money needed to manage the marketing part of your home on your own. It is important to be aware that it is somewhat more complex than it seems, but the decision is yours.

If you decide to trust the entire process to a professional, you will also need to compare the different proposals: exclusive or non-exclusive, intermediation or representation, basic or premium services? Let’s summarize these options.

I do not make any mystery of my absolute conviction that one should never sign a non-exclusive agreement and, even more, that one should only trust an assignment to an agent who works exclusively. This results from a simple observation from within the sector: agents who do not work exclusively manage around 100 properties at the same time. This is due to the fact that the conversion rate of assignments to completed sales is usually below 10%, which forces these agents to capture many homes to make the numbers work. Agents who work exclusively generally offer a high added value service and have a very high conversion rate. Basically, the former build their business on quantity and the latter on quality. As a seller, it is better for you to be one of a few than one of the many.

The second question is: What type of services do you need? If you have a magazine-worthy house to sell, you might save on home staging. However, to obtain the best price, it is important that the marketing is strong, that professional photos and videos (with drones, if necessary) are made, and also a 360º virtual tour. It is interesting that your home is well positioned in the portals, something that only professionals can achieve by paying for highlighted positions.

For a buyer to fall in love at first sight with your house and pay the price you ask for, it is necessary to create an exceptional experience that includes depersonalization, decoration, scents, light, and air conditioning; all to make them feel at home when they enter.

To optimize diffusion and ensure that no potential buyer slips away, it is important to have an agent who works in close collaboration with their competition through MLS (Multiple Listing Services), which are groups that share assignments; or even, as in Easy Brava, through open house days for professionals, where local colleagues visit the property and receive all the marketing material to publish it on their websites, networks, and windows.

So, how much do these services cost? Are all real estate professionals the same or, as in all fields, are there bad, very bad, good, and very good? And is it appropriate to intervene in the market by limiting freedom of contract? Because, in the end, no one is obliged to hire the services of a real estate agent, and many do not.

Let’s look at a concrete example: Sale of a property for 300,000 €

Poor preparation prolongs the marketing time and attracts lower offers. A home that impacts from the start (staging, professional photos/video, 3D, positioning, and MLS coordination) has more chances of selling quickly without negotiation and even with higher offers.

• Scenario A – Non-exclusive (3%) and poor preparation → 10% drop after 6 months on the market Starting price: 300,000 € → closes at 90%: 270,000 €. Net seller: 260,199 €.
• Scenario B – Exclusive, high value (7%), impact from day 1 → price asked after a few weeks Starting price: 300,000 € → closes at 100%: 300,000 €. Net seller: 274,590 €.

Result: despite higher fees Scenario B leaves +14,391 € more in the seller's pocket (274,590 € vs. 260,199 €). If the property also generates bidding wars (for example, +2%), the net will improve even more.

Limiting to 3% the fees that professionals can charge will have the opposite effect to what is desired. Good professionals charging 5, 6, or 7% are cheap for the value they generate. But they will not be able to continue investing a lot of time and money in their assignments because it will not be profitable. Only those who do little will remain, and even charging 3%, they will still be expensive.