Requirements for Working as a Real Estate Agent According to § 34c GewO

The profession of a real estate agent is a responsible and demanding career choice that requires special qualifications and permits. In Germany, the practice of the real estate agent profession is regulated by § 34c of the Trade Regulation Act (GewO). This article provides a comprehensive guide to the requirements that must be met to work as a real estate agent in Germany. We will examine the legal requirements, the application process, necessary documents, and the importance of expertise and ethical behavior in this field.

1. Legal Basis

§ 34c GewO forms the central legal basis for the permit requirement of real estate agents. It stipulates that certain activities in the real estate sector may only be performed with official permission. These activities include, in particular:

• Providing or brokering opportunities to conclude contracts for properties, property-like rights, residential spaces, and commercial spaces.
• Providing or brokering loan agreements.

2. Requirements for Obtaining the Permit

To obtain the permit according to § 34c GewO, aspiring real estate agents must meet certain personal and professional requirements. These include:

2.1. Reliability

The reliability of the applicant is a central requirement for granting the permit. This is checked based on various criteria:

• Certificate of Good Conduct: A recent certificate of good conduct must be submitted, containing no relevant entries that cast doubt on the applicant's reliability.
• Extract from the Central Trade Register: This must also be free of negative entries that indicate unreliable behavior.
• Insolvency Freedom: No ongoing insolvency proceedings may exist against the applicant. A certificate of non-objection from the insolvency court is required.

2.2. Orderly Financial Circumstances

Another important criterion is the applicant’s orderly financial situation. This is verified through:

• Schufa Report: A current Schufa report with no negative entries must be provided.
• Extract from the Debtor Register: This must not contain entries indicating irregular financial circumstances.

2.3. Proof of Expertise

Since the amendment of § 34c GewO in 2018, proof of expertise is also required. This can be demonstrated through:

• Completion of Recognized Training: For example, as a real estate agent or through comparable qualifications.
• Expertise Examination: Alternatively, expertise can be demonstrated through a specific examination by the Chamber of Industry and Commerce (IHK).

3. Application Process and Required Documents

The application for obtaining the permit according to § 34c GewO must be regularly submitted to the responsible Chamber of Industry and Commerce (IHK). The application process involves several steps and requires the submission of various documents:

3.1. Application Form

The application form can usually be downloaded from the responsible IHK’s website or obtained directly on-site. It must be fully completed and signed.

3.2. Required Documents

The following documents must be attached to the application:

• Certificate of Good Conduct (Document Type O): This must be sent directly to the responsible authority.
• Extract from the Central Trade Register: This must also be sent directly to the authority.
• Schufa Report: A current self-disclosure.
• Proof of Orderly Financial Circumstances: For example, through a certificate of non-objection from the tax office.
• Proof of Expertise: Either through a corresponding certificate or through the IHK’s confirmation of passing the expertise examination.

3.3. Processing Fees

Processing fees, which can vary depending on the federal state and authority, are charged for processing the application. These are usually payable upon application submission.

4. Continuing Education Requirements

Real estate agents are required to undergo regular continuing education. This requirement was also introduced by the amendment of § 34c GewO in 2018. The continuing education requirement includes:

• Further Training: Real estate agents must prove at least 20 hours of further training within a three-year period.
• Contents: The training must cover professional topics such as law, taxes, marketing, construction, and real estate economics.
• Proof: Participation in training measures must be documented and presented to the responsible authority upon request.

5. Professional Liability Insurance

Although professional liability insurance is not legally required for real estate agents, it is highly recommended. It protects the agent from financial damages arising from errors or omissions in professional practice. Important aspects of professional liability insurance include:

• Coverage Amount: The insurance should provide sufficient coverage for possible claims.
• Scope of Insurance: It should cover all relevant areas of activity of the real estate agent, including brokerage and consulting.

6. Ethical and Professional Standards

In addition to legal requirements, real estate agents must also adhere to high ethical and professional standards. These include:

• Transparency: All information about the offered properties must be complete and accurate.
• Honesty: Real estate agents must always act honestly towards their clients and not make false or misleading statements.
• Confidentiality: Personal data and information of clients must be treated confidentially and protected from unauthorized access.
• Interest Protection: Agents must best protect their clients' interests and disclose conflicts.

7. Specific Challenges and Solutions

7.1. Market Knowledge and Expertise

To work successfully as a real estate agent, comprehensive knowledge of the real estate market and solid expertise are essential. This includes:

• Market Analysis: The ability to recognize and analyze market trends.
• Legal Knowledge: Knowledge of the relevant legal frameworks, especially rental law and property purchase law.
• Negotiation Skills: The ability to conduct successful negotiations and achieve fair prices for clients.

7.2. Digitization and Technological Developments

The real estate industry is increasingly shaped by digital technologies. Real estate agents must familiarize themselves with these developments and use appropriate tools to increase their efficiency. This includes:

• Real Estate Portals: Using online platforms to market properties.
• Virtual Tours: Using 3D tours and virtual walkthroughs to give potential buyers a better impression of properties.
• CRM Systems: Using customer relationship management systems to manage customer contacts and relationships.

7.3. Customer Service and Service Quality

A high standard of customer service is crucial for the long-term success of a real estate agent. This includes:

• Availability: Agents should be easily reachable for their clients and respond promptly to inquiries.
• Consulting Competence: Comprehensive advice and support on all questions concerning the purchase or sale of real estate.
• Customer Satisfaction: Constantly improving service quality and regularly obtaining feedback from clients to optimize services.

8. Case Studies and Practical Relevance

8.1. Successful Establishment of a Real Estate Agent

A real estate agent who meets all legal requirements, completes regular training, and offers high-quality service has good chances of successfully establishing themselves in the market. An example is the agency "Sample Real Estate," which has achieved a strong market position through professional market analysis, excellent customer service, and the use of modern technologies.

8.2. Challenges and Their Resolution

An example of a challenge could be the transition to digital viewings during the COVID-19 pandemic. By quickly implementing 3D tours and online tools, a real estate agent was able to maintain their services and even gain new clients.

9. Conclusion

The profession of a real estate agent in Germany requires not only meeting legal requirements according to § 34c GewO but also continuous education and adherence to high ethical and professional standards. By combining expertise, market knowledge, technological know-how, and excellent customer service, real estate agents can successfully operate in this dynamic field.

If you are considering a career as a real estate agent or want more information on the legal and practical aspects of this profession, we, as experienced lawyers, are at your disposal. We provide comprehensive advice on all questions regarding the permit requirement, the application process, and professional requirements. Contact us to arrange a personal consultation.