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Real Estate Agents Obligations and Restrictions

December 4, 2025
Home > Real Estate Agents Obligations and Restrictions

Obligations and Restrictions of Real Estate Agents

There are times we turn to a real estate agent (“metavekh” or “metavekhet”) to find an apartment for rent or purchase.
It is worthwhile knowing the basic rules that apply to agents and your rights as clients.

When is an agent entitled to brokerage fees?
The agent is entitled to a brokerage fee (“dmei tivukh”) if three conditions are met:

  1. They have a valid brokerage license.
  2. The client “signed an “order to perform a real estate brokerage transaction.”
  3. The agent was “the effective factor” that led to signing a rental or sale agreement.

Brokerage fee amounts
The amount of the brokerage fee is subject to negotiation between the agent and client.
The agent must state in the order the agreed amount or percentage, and indicate whether the amount includes VAT.
The law does not limit the amount of brokerage fees, but it is customary that in rental transactions brokerage fees are charged at the rate of one month’s rent + VAT.

The agent’s obligations toward the client: 
The agent is obligated to act honestly, fairly, and in good faith, and to fulfill the following duties:

  • Present a brokerage license upon the client’s request.
  • State clearly, during the first meeting, that they are an agent, if they are the one who initiated contact.
  • Have the client sign an order that includes the parties’ details and the planned transaction.
  • Provide the client with all material information known to them about the property.
  • Present an official document about the proposed property: property size, owner details and more.
  • (New) Provide the client with the property condition questionnaire that the property owner filled out, or inform them if the property owner refused to answer it.
  • Disclose to the client if they have a personal interest in the transaction, and obtain their written consent.
  • Like any business, the agent is obligated to issue a receipt for every payment.

Important to know:

  • An agent is forbidden to draft or assist in drafting legal documents related to the transaction, or to represent a client in legal negotiations. An agent who violates this provision – loses their entitlement to the brokerage fees.
  • An agent is forbidden from collecting monies that are not brokerage fees – including “deposit / downpayment”, “earnest money / good faith deposit” or “payment for contract renewal.”
  • An agent is not permitted to receive exclusivity from buyers or renters – only from property owners.
  • An agent may receive brokerage fees from both parties to the transaction, provided that each party ordered their services. If only the landlord hired their services – the renter is exempt from paying brokerage fees.

For more details