broker perspective industry
GOING FOR BROKE
How has the dynamic between the UAE’s real estate brokers and developers evolved over the past year and new market conditions? Oliver Ephgrave speaks to three local brokerage companies to find out more
Laura Choueri, founder and CEO of Dubai-based brokerage
company, Choueri Real Estate, believes that the unsavoury brokers have disappeared from the market: “A lot of agents came into the market in 2007 and I don’t see them surviving today. Real estate is not about selling units at an increase in profit of 10 percent.” Yet Tim Boswell, managing director of UAE-based company
Ocean View Real Estate, believes that these rogue agents will return unless regulations are tightened. “I think a lot of the unscrupulous brokers have been weeded out, but things need to be tightened up. The only reason they’re not here now is because they can’t make money, but as soon as the market picks up they’ll be back. “If you want to set up a real estate company you should
have to show a certain amount of money in your bank account or own property; you should show something to give you sub- stance to be in the country. If you’re not solvent then you’re already a risk. You can’t land in America and set up a company like you can here. “A big problem is people coming from overseas, doing deals,
taking money and leaving the country. Sometimes a deposit on a signature villa will be AED500,000.”
In the post-credit crisis era, the UAE’s real estate brokers have, for the most part, been tarred with the same negative brush. A study conducted in late 2009 by Dubai’s Harbor Real Estate Brokerage found that 61 percent of consumers who bought property in the last two years were dissatisfied with their broker’s performance and rated them as ‘poor,’ or ‘very poor.’ A significant of this dissatisfaction is obviously attributable to the brand of opportunistic broker who
entered the market during the boom years. This type of maverick agent has unfairly tarnished the repu- tation of the more professional brokers, according to Sameer Sami, head of sales and leasing UAE for international brokers Chesterton. Sami says: “We are qualified and experienced agents, but this is not the case with every brokerage company. Random people became agents and they ruined our business. In Abu Dhabi, anybody can be an agent still, and this needs to be stopped.”
WANTED: MARKET CONFIDENCE
Yet agents also feel the need to regulate the actions of developers. John Akhlaghi, sales/leasing consultant for Ches- terton, says: “More transparency will help the market – buyers need to be confident in a product. Some people are putting all their savings into buying something, so they need to feel safe that the project will not be cancelled. In Dubai there are some escrow laws but Abu Dhabi is less developed.” Boswell agrees and adds: “You shouldn’t be able to get your
hands on customers’ money without a credit check to show that you have got liquid funds. People that have no history in development shouldn’t be allowed to be developers. In Abu Dhabi there’s still no escrow law, so things are left wide open. I think that the emirates should work together and there should be a UAE RERA – if a developer has misbehaved in one emirate then they should be blacklisted from the entire country.”
20 /
/jun-sep 2010
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