Realtors against: ‘Any law restricting market relations is doomed to fail’
State Duma proposes to cap commission fees for real estate agents
The real estate market in Russia has long been an arena for heated discussions. One of the most pressing topics in recent years is the high commissions of realtors. According to many citizens, they make renting and buying housing financially unprofitable. This week, State Duma deputy Yaroslav Samylin proposed legislation to limit the amount of realtors' commissions, suggesting setting an upper threshold of 50% of the tenant's and landlord's fees. “In principle, any law that restricts market relations is definitely doomed to failure," Andrey Saveliev, the vice president of the Guild of Realtors of the Republic of Tatarstan, commented on the idea. Read about the pros and cons of the initiative in the material of Realnoe Vremya.
Realtors under fire: MP suggests curbing the appetites of intermediaries
State Duma deputy Yaroslav Samylin from the New People faction proposed to legislatively limit the amount of commission fees for realtors by sending a corresponding appeal to the Minister of Economic Development of Russia Maxim Reshetnikov.
The initiative has caused a wide public outcry amid numerous complaints from citizens about high fees, which can reach 100% of the cost of a monthly apartment rental or 7-10% of the amount of a real estate transaction. According to the deputy, such rates make many transactions financially unprofitable for clients, especially in the suburban construction segment, where the issue of the cost of realtors' services has already been raised by Nikita Stasishin, the deputy minister of construction and utilities.
Yaroslav Samylin suggests setting the upper limit of the commission fee for realtors at 50% of the fee of both the tenant and the landlord, which, in his opinion, will protect the rights of consumers and eliminate unreasonably high payments.
No one cancels market relations
Andrey Saveliev, the vice president of the Guild of Realtors of the Republic of Tatarstan, told Realnoe Vremya that the initiative would not even reach the first reading in the State Duma. He himself has a negative attitude towards it:
He told me what is usually included in the price:
“It depends on which services, if we are talking about selling an apartment, then this is a fairly large complex, starting from legal support and advertising, ending with the transaction itself.”
Professionalism is questionable: who actually works in the real estate industry
The appeal also highlights the problem of illegal income of realtors, who often do not pay taxes in full, as well as the low level of professionalism of some market participants, where anyone without qualifications or experience can work. The deputy focuses on the fact that citizens often do not understand why they pay large sums, for example, for drafting a standard lease or sale agreement for real estate, while there is no guarantee of high-quality services.
“At the same time, many citizens, both buyers and sellers of real estate, do not understand why they should give hundreds of thousands or millions of rubles to realtors for drawing up a standard lease or sale agreement for real estate, especially given the lack of opportunity to verify the qualifications of a realtor and his integrity, because anyone can work as a realtor, even if he has there are no relevant qualifications," Yaroslav Samylin said in a conversation with RIA Novosti.
Andrey Saveliev also advocated for mandatory certification of realtors:
“It basically exists. We have a professional standard approved by the Ministry of Labour, which is in effect. Another question is how this standard is controlled, but the standard itself is there.”
There is another side: how developers will take advantage of the situation
Maxim Nikolaev, the managing partner of BMP Brands Group, has a different opinion. According to him, if the initiative is supported, competition will cease by increasing the commission fee for the sale of an apartment.
Maxim Nikolaev is sure that developers will benefit from this situation: “Over the years they have managed to build an understandable and convenient system for realtors.”
