ESSENTIAL INFORMATION TO DEVELOP THE PROFFESSION OF REAL ESTATE AGENT IN THE VALENCIA REGION – DECREE 98/2022
A new regulation has emerged in the Valencian Region/Comunidad (including Alicante, Castellón and Valencia province) that will really mean a «before and after» in the exercise of the activity of intermediary, or mediation agent in real estate transactions in the Valencia region.
This is a new law, which requires greater knowledge of the profession and activity, as well as a greater degree of commitment and responsibility on the part of all real estate agents involved in real estate transactions in the Valencian region.
As you all know, currently, the exercise of the real estate agent profession in Spain is not regulated, as it is in other countries such as France, Belgium, Germany, Holland, USA, etc.
This has been one of the questions that has always been raised by foreign buyers who come to Spain in search of a property, and who are surprised that in Spain there is no regulation of the profession of real estate agent, and controlled by the State, through some type of training, certification, or registration.
In several communities such as Andalusia, the Canary Islands, Madrid, Murcia, there are certain registries in which professionals dedicated to real estate brokerage must be registered to exercise their profession, and their activity.
As a result of this, the Valencian Community has proceeded with the creation of a registry of real estate brokers/agents, with the aim of regulating, controlling, and supervising the activity of all those intermediaries in real estate operations and transactions in the Valencia region.
This registration obligation extends not only to the act of registration itself. It is not simply an entry in a registry, but it is also about establishing a series of guarantees, obligations and requirements that agents must respect, both at the level of training, as well as civil liability for damages caused in the exercise of their profession, negligence, etc., as and as if it were any type of professional such as doctors, lawyers, architects, economists, etc., who are required to comply with these guarantees and regulations in their professional activities.
Obviously, this registration is going to mean a great change in the Valencian real estate sector. On the one hand, it will mean the consolidation of all those real estate agencies that are well established in the territory, and that act honestly, seriously and solidly in the Spanish market, and with extensive experience in the sector.
However, this regulation will leave out all those who act in the real estate market in the area in an eventual, or unserious way, and which are not prepared for professional, diligent, and effective development in such an important activity for national/international legal traffic of purchase and sale of properties and consumer homes.
We are talking about Decree 130/2021 of October 1 of the Consell, of Approval of the Regulation for the Mobilization of Empty and Disabled Homes, issued in execution and development of the Law for the Social Function. This decree contemplates the regulation of the intermediation activity in the scope of the regulations on the right to housing, so that there is an effective control by the administration to improve the quality of the real estate intermediation service, in which it is required registration in a registry, which must be public, thus protecting consumers and users who use it.
Therefore, this regulation will result in an improvement in the service guarantees for consumers and users.
This also establishes a system of sanctions for all those who are not registered in said registry, or fail to comply with any of the obligations imposed by the regulations for the exercise of their profession. These penalties vary from
- Offenses classified as serious will be sanctioned with a fine of 10,000.00 to 350,000.00 euros.
- The infractions classified as very serious will be sanctioned with a fine of 350,001.00 up to 950,000.00 euros.
Therefore, through this new regulation, a guarantee regulation of the service and of the real estate agent profession in the region is established and consolidated, with the consequent improvement of guarantee and quality of service, which results in better protection of consumers and users.
In the development of this regulation, two decrees of the Consell have been published, Decree 85/2022 of July 1, which approves the Regulation for the Mobilization of Empty and Disabled Homes, and Decree 98/2022, of 29 of July , the most important, which regulates the Registry of Real Estate Brokerage Agents of the Valencian Community (DECRETO 98/2022, de 29 de julio, del Consell, por el que se regula el Registro de Agentes de Intermediación Inmobiliaria de la Comunitat Valenciana y los requisitos para la inscripción) . as well as their requirements for registration.
It is based on this latest Decree, 98/2022, of July 29 , which entered into force on August 16, 2022 , on which we are going to base the content of this article.
1.- Objective and purpose of the law
As we have been commenting, this new regulation aims to create the » Registry of Real Estate Brokerage Agents «, of the Valencian Community, as well as the regulation of all those requirements necessary to register all those people who dedicate themselves to this profession, individually, or business.
When we speak of “ mediation activity ”, or “ real estate brokerage ”, we refer in a general way to all those people who are dedicated to mediating, advising, or managing transactions on assets and real rights on properties, apartments, land, whose destination final is the use of «Housing».
Therefore, the purpose of this new regulation is to improve transparency in this type of services and transactions, as well as to guarantee the protection of all those consumers of these services in matters, above all, of housing.
Therefore, although it is not clear in the regulations, those obliged to follow the requirements of this law are all those who mediate, or advise, in operations whose purpose is based on the sale of homes, and not on other types of properties such as land. , commercial premises, industrial premises, etc.
2.- Who is this Law addressed to?
All those natural or legal persons, that is, companies or natural persons, who want to carry out the activity of real estate brokerage within the territory of the Valencian Community in a «regular» way, will be obliged.
The regulations understand that it is about all those who provide mediation, advice and management services in real estate operations in relation to transactions of sale, rental, exchange, assignment of real estate, and the corresponding rights , including the following:
- Collegiate real estate agents , in accordance with their specific legislation. That is, the APIs
- Those who have a university degree in the branch of social and legal sciences, engineering, or architecture , accredited with the university degree. For example, lawyers, economists, etc.
- Any natural or legal person who has the professional training required for collaborating real estate agents.
- Who provides certificates of attendance and achievement to academic «training courses» of at least 200 teaching hours in real estate , related to mediation services, advice and real estate management. It does not matter the modality that is face-to-face, distance, online, or mixed.
Obviously, in the Valencian region, there is a large number of agents who work within the international real estate sector, who do not have university degrees approved in Spain, who will need professional training courses as real estate agents . In other words, they are professionals, often of foreign origin, who have settled in Spain to develop real estate activity, and who do not have a university degree, for which they will need to contract an academic training course, in which for at least 200 hours, they are trained in real estate, related to management, mediation, advice and management services.
Here we include some examples of the Real Estate Management and Brokerage Courses that we have found in Google Search
As the law indicates, these courses can be both face-to- face , distance, online, or mixed .
In addition, as we are explaining, these professionals have the obligation to register in said registry, provided that they are dedicated to real estate brokerage on a regular basis .
This profession is considered to be carried out on a » regular basis «, when the agent has intervened in the intermediation of more than two purchase or housing operations in any real estate business related to housing in the Valencian Community per year.
Therefore, once this law is in force, any person who acts in the real estate market in the Valencian Community in more than two services in the last 12 months, must register in the registry of agents , and comply with the requirements established by the normative.
A possibility is opened for all those Real Estate Agents who carry out operations in the Valencian Community, and who have other operational centers in other parts of Spain and who have already obtained training in their places of origin to have access to similar Registries . That is to say, it may happen that a real estate agency in Malaga carries out sales operations in the Valencian region, and that they are already registered in the analogous registry of the Andalusian region, for having fulfilled the previous training requirement, for which In these cases, there will be an obligation to register in the Valencian Community registry, although the title or course obtained and which has served to train this professional agent in the Andalusian region may be approved for use in the Valencian Community. .
In other words, you will not have to obtain a new training title, if you already had it to register in the registry of the Andalusian community.
3.- Requirements and guarantees to carry out the activity.
- Location and Care Requirements
– The person who develops the profession of real estate agent must have an establishment open to the public , unless their services are provided exclusively online or telematically.
If you have an establishment open to the public , it will be understood as such the professional address, the commercial premises, or the offices or offices that meet all the requirements and have the permits, activity licenses, and tax registrations legally required to carry out the activity. .
In the cases in which the people who provide services do so exclusively electronically, telematically, or online , they must have a physical address in the territory of the Valencian Community.
That is to say, a Belgian, or German, or English real estate agency, which develops its real estate brokerage services in Spain, must have a physical address in the territory of the Valencian Community.
Similarly, a real estate agency in Malaga, or Mallorca, that sells properties in the Valencian Community, must have a physical address in the territory of the Valencian region.
In the case of establishments, in the event that they have, or the physical address of those companies, or agents, that work exclusively online, they must attend to the queries, complaints, claims of consumers and users in relation to the Real estate brokerage services they have provided.
When the real estate agent is a legal person , the professional training requirements will be required of the administrators of this company , or, at least, of one of the members of the company’s board of directors .
The training requirements will also be required of those responsible for establishments open to the public, who in no case may be in charge of more than three establishments, and will endorse all order notes and mandate contracts made in the name of the legal entity.
That is to say, in the case of a legal company that is dedicated to real estate agency, the administrator, or one of the members of the Board of Directors of the company, must meet the professional training that is required of these agents, that is, if have a Spanish university degree, have completed the management training course in intervention and real estate advice.
In addition, if these companies act through establishments open to the public, offices, etc., those in charge of these establishments that are different from the administrators of the company, will also have to have the necessary training, and may not have more than three establishments. at your expense.
In the case of agencies that operate exclusively electronically, telematically, or online , the training requirements will also be required, not only for the administrators of the company, or the person in charge of the agency, but also the person linked to the physical address that provides the services electronically . That is, for example, in the case of an agency in Malaga, which operates in the Valencian Community, without an establishment, but through a physical address, the training of the person in charge of the physical address will be required.
- Solvency requirements
The professional or intermediary agent must have insurance and service guarantees to cover their liability for damages caused by their work, taking into account the following:
1.- You must either hire a guarantee issued by a bank, or insurance from an insurance company, to guarantee the deposits received in the purchase operations (reserves, deposits, earnest money), in order to guarantee their return to the corresponding part in case of incapacitation by the agent.
That is, in those cases in which the agent receives amounts, or provisions on account of the price, they must previously have a guarantee, which will be issued by a bank or by an insurance company.
In those cases in which the agent acts through an establishment in the Valencian Community, the minimum amount of this guarantee, or surety insurance for each agent will be €60,000 per establishment open to the public and year of coverage .
And, in those cases in which people carry out their activity through electronic , telematic, online means, it will be €300,000 per agent, and year of coverage .
2.- In addition to the guarantee, they must have civil liability insurance , which covers the entire territory of the European Union, for those responsibilities that may arise from damages caused to their clients, due to fault, error, or professional negligence.
This insurance must cover at least €600,000 per claim , and year of insurance, with a limit of €150,000 per victim.
If the agent works exclusively online, the minimum amount of civil liability insurance will be 1 million euros per claim , and year of insurance , with a supplement of €150,000 per victim.
The agents will be obliged to provide all those who request it with the policy number and the name of the insurance company, or the guarantee number and the name of the financial institution in the case of guarantees, and they will state it in the the mandate contract or the order note that they sign and contract with their clients.
These insurances and guarantees can be constituted individually, or collectively through professional associations or associations of lawyers, real estate agents, engineers, architects, etc.
4.- Procedure for registration in the registry
– The procedure for registration in the registry is initiated at the request of the person concerned by electronic means, that is, online, in the registration service of the Generalitat Valenciana.
– Applications can be submitted individually or collectively.
- Individually , the agent will present a declaration of responsibility in which he must state the identification documents and the following indications:
– That it has an establishment open to the public , or, in the case of providing services exclusively online, remotely by electronic means or telematics, it will have to indicate the physical address that it has in the territory of the Valencian Community.
– That in order to carry out mediation services and activities in the field of real estate services, the permits, activity licenses and corresponding tax registration as self -employed , business opening activity license, etc. have been granted.
In other words, if you have a business premises where you carry out your profession, which has a queue that has the corresponding opening license, and that the agent is registered for tax purposes with the Spanish tax agency.
– That it undertakes to develop its activity in accordance with the principles of action and codes of conduct on professional ethics, behavioral ethics , professional secrecy, as well as the commercial and transfer communications that I made with respect to the fixing of its remuneration of commissions, fees, etc.
– That it has the required professional capitalization
– That he has the professional civil liability insurance and surety policy , and that he has subscribed the guarantees in the amounts and modalities required in these regulations , in order to protect clients against the inability of real estate brokers to transfer the amounts they receive in the exercise of their brokerage activity.
– That it undertakes to maintain the conditions and requirements that this regulation provides for carrying out the activity of real estate agent.
In addition, in this responsible declaration, the agent authorizes the people who manage the register of agents of the Valencian Community to carry out all the checks and verifications of the documentation provided to verify that they comply with the requirements established by law.
- Collectively, through the professional association, be it real estate agents, lawyers, architects, engineers, etc., etc.
– Once the application has been submitted with a responsible declaration, the registration will be agreed immediately in the registry, and the document accrediting the registration will be delivered to the interested person.
– Registration will be done personally for each agent . In other words, whether it is submitted individually or collectively, the registration will always be made to each of the agents, individually, who are part of the application.
– The registration has an indefinite duration , without prejudice to the cases of suspension or cancellation provided for in these regulations, and a standardized badge will be awarded, which appears in the annex to the law, and which is as follows:
– The registration allows the immediate accreditation of the person who appears in the registry that meets the requirements and the appropriate conditions to carry out the activity, provided that the circumstances, obligations, requirements and commitments assumed at the time of registration are maintained over time. Inscription.
For this, registered professionals must always have updated data, and inform the administration of any type of modification . This update or modification of the data will always be carried out by means of a responsible declaration.
– The registration entry will be canceled automatically by:
- By death
- Due to withdrawal of tax activity in the case of a legal entity
- Due to non-compliance with the registration requirements at any of the moments in the development of the professional activity
a) Deadline for submission of registration of individual applications
The term is one year from the entry into force of this decree.
With which, all those who are carrying out professional real estate brokerage activities and subject to this law, have a term until next August 2023 to manage the registration in the registry of real estate brokerage agents of the Valencian Community. As well as providing the civil liability insurance policy and the guarantees established in this law.
b) Deadline for collective applications, professional associations or associations must submit the application collectively in plastic within a maximum period of six months .
1.- How obtain the Bank guaranty demanded by the law?
ANSWER: We recommend you consult your Bank , or your Insurance company. They should give you the proper advice on it.
2.- How to register and where?
ANSWER: The Registry of the Real Estate Agents is not created yet. It is expected to be created in October-November 2022.
3.- Is there any other documents which you might be required?
ANSWER: Although the law says nothing, as well as the rest of conditions requested in the law, it is expected from you to provide:
- Certificate of Free of Criminal Records – Interior Ministry
- Certificate of Free of Tax Debts – Agencia Tributaria
- Certificate of Free of Social Security Debts – Seguridad Social
- Digital signature
- Activity license of your Agent’s office – Town Hall
- Registration as autonomo – 030/Deeds of the company
- CIF of the company
4.- I am just renting properties and not selling in the Valencia region, do I need to register?
ANSWER: If you made more than 2 transactions of sales, rents, etc in Valencia region, you need to register
5.- I have 2 offices in Valencia region, and I am a company how to register?
ANSWER: We understand that the registration must be for the administrator of the company, who may be in charge of the 2 offices.
6.- I have 4 offices in Valencia region.
ANSWER: We understand that in this case, you need to register 2 agents: One for 3 offices, and another one for the 4th one.
IMPORTANT NOTE: This is a new law, and the details and questions about its intepretation must be sorted together by the practice and the experience on its development. So, this report has been created by our own interpretation of the recent law, which might not be the same of the administration in the future. So, please, consider this article as a source of information, but not as a matter of law or handbook.