To utilize the services of an Israeli real estate agent, one typically begins with signing a “Request For Real Estate Brokerage Services” form. The document can be signed remotely or in person. It typically contains basic information about you, the specific property, and the commission rate due to the real estate agent. It is recommended to review the contents of any form or authorization between yourself and a real estate agent very carefully, to avoid the risk of “small print.” The Israel Real Estate Agent Law – 1996 as well as the code of the ethics of the Israel Real Estate Brokers’ Association govern the professional obligations and responsibilities of real estate agents in Israel.
In contrast with other countries, which have implemented a system of separate real estate agencies for buyers and sellers, in Israel, there is one Israeli real estate agent that typically represents both the buyer and seller. Be aware that the customary commission rate charged by real estate agents in Israel is 4%, about half (2%) paid by the buyer and about half by the seller. The fee becomes payable during escrow after you’ve signed a contractual agreement with the seller, but before you’ve taken possession of the apartment. The real estate agent’s commission fee can be negotiable, depending on the agent in question.
One might work with more than one real estate agent, and from our experience should never be obligated to pay an agent anything unless you’ve decided to buy their apartment. Remember that if your real estate agent is successful and you find and buy the right apartment through them, the agent’s fee will have been a successful investment. It is advised to be cautious when working with an Israeli real estate agent. For example, revealing what you’re willing to pay for an apartment while offering the seller a much lower price could backfire because no matter how kind or persuasive a real estate agent can be, an agent could sometimes be trying to persuade you to buy a flawed, less desirable apartment due to a conflict of interest, or a desire for commission.
In our experience, a good agent will always answer your questions, no matter what. A good agent will also disclose to you any vested interest in the transaction (for example, if they’ve purchased and/or sold the apartment before), so don’t choose an agent who can’t or won’t give clear, pointed answers to every question you have. As your relationship with the agent is governed by unified contract law, legally speaking you have the right to demand transparency and good faith. Many real estate brokers publish online listings of apartments on which they have brokered sales. We recommend taking advantage of this and choose to work only with those who clearly possess successful experience brokering sales of the kind of apartment you want to buy, in addition to being forthright.