Dubai has always been progressing towards achieving more and the Real Estate sector is one of the pillar that has always performed exceptionally well towards the economic growth of this Emirate. The Real Estate Regulatory Authority (RERA) continuing the attainment forward has taken yet another major step which implies developers and agencies to seek permission through RERA for any property related advertisement. An online system named as Trakheesi, allows the registered brokers and developers to apply permissions conveniently in order to advertise properties within Dubai and other regions. According to the rule, the applicant would need to get proper documentation in place which would be submitted to RERA through Trakheesi that would later be approved or disapproved for advertising depending upon the regulations.
This is a major step towards industry maturity, because looking at more matured Real Estate markets like UK, US and Canada the two factors that stand out are transparency and regulation, and Trakheesi system despite adding these two factors to the industry also formulates a streamline process where it creates a balance for all the stakeholders of the real estate industry that includes brokerage, developers, news media and online portals.
Duplicate listings, improper documentation and fraudulent details have been major concerns in the industry for long, and through the implementation of this advertising rule, these issues would be tackled at large and for good. The change would result in lesser number of listings in the market, but would save a lot of time of buyers and tenants who fall into the trap of “I will get back to you shortly” or “this unit has just been rented or sold out, but I have another one to offer you, which is a bit more expensive”.
Apparently in the short run, this would give online portals a shock because the number of listings’ shelf spaces that are sold by these portals will be reduced dramatically resulting in a revenue decline, but this will eventually help the industry in reaching out a proper balance between agencies spending the right amount of money on marketing and effectively work on their direct listings only. Portals that target international audience represent the Dubai Real Estate Industry as a whole, and if only the right information is published, this would give more credibility and effectiveness to the industry. Although, in the long run the number of inquiries might go down, but the genuineness of leads would increase which would result in a better conversion ratio.
In terms of Off plan developments, generally for every new launch a race starts among the agencies to get their email flyer or advertisement out in the market, without having to check if they are authorized to do so, and if the details in their flyer are complete or not. The rule explicitly discards all these issues as agencies now have to get an approval from RERA which will only be provided when all the relevant details are clearly mentioned in the email flyer. Now, if a potential client receives an advertisement there won’t be any missing detail in terms of completion date, price, payment plan, service charges and most importantly if the project and project developers are RERA approved and escrow account is in place.
For the secondary market which are ready properties, the change would be welcomed by the agencies happily as this would imply landlords and owners to sign Form A with limited agencies, where only after a mutual agreement in place, the agency would be allowed to market the property. This is a very smart move by RERA towards creating an equilibrium in the market, as the agencies are not allowed to charge anything from the owners, and at the same time the owners will have to choose limited agencies which would imply agencies to work more seriously, proactively and effectively on each property that they are authorized to sell or rent. Gradually when the landlords are educated about the law, for which the government authorities and agencies would have to play their part, this would turn the table in a way that owners would research and look for the best agencies to list their property for sell or rent, instead of agencies reaching out to the landlords to list their properties.
For any change that comes into place in any industry, there is always a transition phase where the stakeholders tend tounderstand its objective and analyze how the change would impact the industry as a whole. Currently, the transition period is about to end, as many agencies have realized that moving forward this would eventually help the market, their business and most importantly the end users who would be able to access the right information effectively, and reach out to their decision without wasting any time on false advertisements.
By Mohsin Ayub – Media Strategist, SPF Realty