The legal obligations of the real estate hunter profession
The profession of apartment hunter is governed by a specific law called the Hoguet law. The Hoguet law is law No. 70-9 of January 2, 1970, which regulates the conditions for the exercise of activities related to real estate transactions. It establishes the legal obligations for a real estate hunter, such as the possession of a professional card and the transparency of the rates charged. Here are the legal obligations of a real estate hunter.
Rule 1: hold a professional card
Activities affected by the Hoguet law “may only be exercised by natural or legal persons holding a professional card, issued, for a period and in accordance with procedures established by decree in the Council of State, by the president of the territorial chamber of commerce and industry or, in districts where there is no territorial chamber of commerce and industry, by the president of the regional chamber of commerce and industry, specifying which operations they may carry out”. This is what Article 3 says, which also states that CCI France has created a file dedicated to persons holding a professional card. “in accordance with procedures defined by decree”. File that it updates regularly. The professional card, also called transaction card or even T card, is only issued to natural persons who can “prove their professional suitability” and/or “justify a financial guarantee allowing the reimbursement of funds, effects or values deposited [...]”. This guarantee must be a written commitment issued by a specially authorized insurance company or even by a credit institution. Finally, the card is only issued to legal persons complying with the two conditions mentioned above (suitability and guarantee) and only if their legal and statutory representatives also comply with certain conditions defined by law.
Rule n° 2: have taken out civil liability insurance
Other legal obligations of real estate hunters, they must take out an insurance contract “against the pecuniary consequences of their professional civil liability”. You should also know that while some insurances are not mandatory, they can still be useful. This is the case with office insurance or professional local insurance (the title may vary depending on the insurance companies). Taking out legal protection to benefit from useful advice in case of need can also be a good idea.
Rule 3: get a search warrant signed
Whether simple, semi-exclusive or exclusive, the real estate hunter must obtain a search warrant signed by both parties before starting his mission. This mandate should include various elements such as:
- The type of mandate;
- Its duration;
- The date;
- Contact details and other information about both parties;
- The description of the property sought;
- The conditions for renounce/renewal of the mandate;
- The agent's fees;
- Articles L. 121 -23, L. 121-24, L. 121-24, L. 121-24, L. 121-24, L. 121-24, L. 121-24, L. 121-25 and L. 121-26 in their entirety...
Rule 4: get paid only for the result
Like brokers, in particular, real estate hunters can only be paid if there is a result. This means that if none of the properties offered by the professional is suitable for his client and if no visit leads to the purchase of an apartment or even a house, future buyers owe nothing to the real estate hunter. In addition, the latter is not entitled to charge research fees or application fees.
The Hoguet law prohibits this in article 6. “No property, effect, value, sum of money, representative of fees, expenses of research, process, advertising or any intermediary, is due to the persons indicated in article 1Er or cannot be required or accepted by them, until one of the transactions referred to in that article has actually been concluded and recorded in a single written document containing the commitment of the parties.” The Article states that in the case of a mandate including an exclusivity clause or a penalty clause, “even if the transaction is concluded without the intermediary's care, this clause will be applied under the conditions that will be established by decree. The sum paid by the principal pursuant to this clause may not exceed an amount fixed by decree in the Council of State.”. Finally, the keeping of records and the issuance of receipts, in particular, are mandatory (Article 5).
Rule n° 5: respect the legal obligations related to door-to-door canvassing
A real estate hunter can do door-to-door canvassing. However, he must respect certain rules as stipulated in the Hamon law. First of all, a pre-contractual information document must be given to the persons approached. Then, they are entitled to a cooling-off period of 14 days.
Rule 6: be transparent
The real estate hunter is obliged to provide his customers with a summary of his fees expressed in euros including VAT. At HOME SELECT, we have chosen to go further by offering you to calculate our fees directly online, based on the purchase price of the property. For an apartment or a house at 280,000 euros, for example, you will pay 10,000 euros in research fees (only based on the result, let's remember). For a property worth 500,000 euros, count 12,500 euros in fees to call on our team. For a high-end property worth one million euros, we increase to 25,000 euros in fees. The Hoguet law also states that the real estate expert must not be hit. “of one of the disabilities or prohibitions to practice defined in titles II [Of the inability to carry out activities of intermediary and management of real estate and business assets] and II bis [The National Council for Real Estate Transaction and Management]”. This includes a final conviction for a crime dating back less than 10 years or even a term of three months in prison for money laundering. In addition, when a real estate hunter starts his business, he must fill out a prior declaration of activity. This declaration can only be completed by the director of the agency (or others) and must be completed for each institution.
Do you want to use our services for your real estate search? Contact us without hesitation. See you soon!
