The following calculation example shows that mortgage lending customers who finance the purchase can also benefit from a certain relief, even if the seller’s commission is completely added to the purchase price due to the buyer principle when buying real estate. The reason: By not having to pay a broker’s commission, they would have more equity available and that usually results in lower interest rates. If they benefit from better interest rates, mortgage lending customers can save in certain constellations despite the higher purchase price – because they are burdened with lower interest costs, which add up to a large sum over the years.
The invoice shows the relief for three cases: once for the case that the buyer pays the commission in full, as is not uncommon at present, also for the case that the seller pays the broker’s commission and adds it to the purchase price, and finally for the In the event that the seller pays the broker’s commission and does not add it to the purchase price.
Sample calculation for the customer principle when buying a property
|1: Buyer pays commission||2: Seller pays commission and adds it to the purchase price||3: Seller pays commission and does not add it to the purchase price|
|-7.14% brokerage commission||-28,560||-0||-0|
|-6.0% real estate transfer tax||-24,000||-25,714||-24,000|
|-2.0% notary and land registry costs||-8,000||-8,571||-8,000|
|Effective interest rate||1.98||1.75||1.75|
|Remaining debt after 15 years||233,885.50||237,655.20||217,470.53|
|Annual savings compared to case 1||742.92||1,897.92|
|Savings in 15 years compared to case 1||11,143.8||28,468|
Conclusion: In the third case, i.e. if the seller pays the broker’s commission and does not add to the purchase price, the buyer saves 24,000 euros when buying. Since this money can now be brought into the financing as equity, the interest is reduced and the savings even increase to 28,468 euros in 15 years. Even if the buyer completely adds the commission to the purchase price, in this example the better interest rate with more equity results in a significant saving of over 11,000 euros over the years – but the remaining debt is still almost 4,000 euros higher. Overall, however, there is an increase of around 7,000 euros.