How to terminate a contract with a real estate agency in Peru

The real estate brokerage agreement or "sale assignment" is usually signed in a hurry: the agency arrives with a potential client, presents the form, asks for a signature and takes the keys. Months later, when the owner is not getting results or wants to sell on their own, they discover that the contract ties them down and that breaking it can be costly. This article explains how to terminate a real estate assignment in Peru, what the law says and what steps to take when the agency refuses to release the property.

The legal framework

Real estate brokerage in Peru does not have a specific sectoral law. It is governed by:

• Civil Code, articles on services and mandate (1755 and following).
• Consumer Protection and Defense Code (Law 29571), when the owner is an end consumer dealing with a company.
• Law 29080, which creates the Real Estate Agent Registry (REAI) and requires registration to practice professionally, although enforcement is limited in practice.
• Ordinances and professional regulations from the Cámara Inmobiliaria Peruana (CIP) and other guilds.

The contract is a services agreement. The owner remains the owner and, except for express provisions, can revoke the assignment subject to contractual consequences.

Types of assignment

Non-exclusive

The owner can hire several agencies and sell on their own. Commission is only paid to the one that closes. It is the most flexible and ends with a notice.

Exclusive

A single agency lists and manages the property for a term (typically 3 to 12 months). If the owner sells through another channel during that term, the full agreed commission must be paid.

Co-brokerage

One agency leads and coordinates with others in the market. It has exclusivity over the owner but opens the property to several brokers.

Grounds to terminate without penalty

1. Term expiration. Most contracts have a fixed term; once it expires the contract ends, save for express renewal.
2. Serious breach by the agency: not posting the listing, not responding, not scheduling visits, not reporting.
3. Abusive clauses under the Consumer Code (articles 49 to 53): tacit renewals, disproportionate commissions, absolute prohibitions on revocation.
4. Defects of consent: contract signed under pressure, without a copy delivered or with clauses not previously disclosed.
5. Fortuitous event or force majeure: serious illness, divorce, withdrawal of the property from the market for family reasons.

When commission is owed

Even after termination, the agency keeps its right to commission when:

• It introduced the buyer who ultimately closed the deal, and the closing happens within the subsequent protection period (60–180 days, depending on contract).
• There was a causal nexus between its activity (visits, negotiation, offer reception) and the closing.
• It complied with the contract and the owner sold to a third party during the exclusive term.

The Peruvian practical rule mirrors comparative law: commission is paid when brokerage was effective in completing the sale.

Termination procedure

1. Read the entire contract: term, type, penalty clause, protection period, dispute resolution forum.
2. Identify the applicable termination ground.
3. Draft and send a notarial letter of contract resolution, citing the ground and requesting return of documentation, keys and removal of listings from portals (Adondevivir, Urbania, Properati, Mercado Libre, Facebook Marketplace).
4. Keep screenshots of the listings before and after, to prove breach.
5. If the agency refuses, file a complaint with INDECOPI (Consumer Protection Commission) for abusive clauses or misleading advertising, as the case may be.
6. In parallel, consider out-of-court conciliation at an authorized center.
7. As a last step, civil lawsuit for contract resolution.

Penalty clause: how enforceable it is

The penalty clause is valid (Article 1341 of the Civil Code), but the judge can reduce it equitably (Article 1346) when it is manifestly excessive or when the obligation was partially performed. INDECOPI has also declared abusive penalties of 100 % of the commission for simple revocation when the agency did not prove real activity.

A penalty clause of 3 to 5 % of the property's value usually holds; one equivalent to the full commission without documented activity is almost always moderated.

Before signing the next contract

1. Demand short terms (3 to 4 months) renewable by agreement.
2. Limit exclusivity geographically or by channel (in person vs. portals).
3. Define specific obligations of the agency: posting on at least three portals, minimum number of monthly visits, CRM reports.
4. Cap the subsequent protection period at 60–90 days.
5. Demand symmetry in the penalty clause: if the agency breaches, it is also liable.
6. Verify that the agency is registered with SUNARP (as a legal entity) and, ideally, in the REAI.
7. Keep an inventory of keys and documents handed over.

Real case

An owner in Surco signed a 12-month exclusive with a 100 % commission penalty for termination. After five months, with no visits on record and the listing posted only on a social network, he ended the contract via notarial letter. The agency claimed S/ 18,000 in commission. INDECOPI declared the clause abusive and the conciliation closed without payment.

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