According to the Khaleej Times, developers are expected to quicken the pace of the ongoing 136 construction projects in Dubai to deliver over 25 percent more residential units by the Dubai Expo of 2020. Their research also shows that around 48,000 residential units are expected to be available post the Expo.
According to Lynnette Abad, the director of Property Finder, the Dubai projects are in full swing, and the construction pace is not slowing down. Over 25 million visitors are expected to visit Dubai during the Expo, so the supply of residential units, as well as serviced apartments, is only expected to rise.
With development projects in full swing, the supply of residential housing set to possibly exceed the demand of the Expo visitors and over 100 residential projects in the construction pipeline, what should you expect, or not expect, from a Dubai real estate agent in the near future?
The government of Dubai has decided to create a digital platform by 2020 for property sales and rental transactions. The point of this digital platform is to oversee these transactions as well as to allow buyers, sellers, and renters a more central and accessible platform. Earlier, it was basically impossible to buy or sell, or even rent property, in Dubai without the help of a real estate agent.
Now, with this upcoming platform, buyers and sellers will have easy access to each other, and the platform will allow complete transparency. As a part of the Dubai 10x initiative, The Dubai Land Department has shared plans about this digital platform called Real Estate Self Transaction, which will allow real estate transactions to occur through digital management. That means, eliminating the need for any paper documents and taking brokers and estate agents out of the equation.
So, with the increase in the supply of residential units posts the Dubai Expo, we also expect to see a decrease in the services of real estate agents and property brokers. However, with the digital platform still in the pipeline, this shift from the human workforce to machine intensive property management will only occur once the prototype has been approved, used, fixed and finalized.
So basically, the better agents will adapt and shift their practices – you can expect your estate agent to negotiate a deal that seems too good to be true, while the agents who won’t be able to shift or adapt won’t be in business anymore. In short, unless your real estate agent can find some really good deal, you can expect to buy and sell property on your own through a digital platform. Basically, you can’t expect your real estate agent to be your only middleman when it comes to buying or selling property in Dubai, because the whole point of digitalization is to remove the middleman.
With that being said, the introduction of a digital management platform doesn’t mean that property agents will completely cease to exist. Sellers will still hire estate agents to market their properties, show the property to potential buyers and even ask their agent to manage the paperwork.
On the other hand, buyers will still go through brokers for house viewing – it is always easier to hire an estate agent who can find potential houses, set up house viewing and help negotiate a deal. At the end of the day, no digital platform can negotiate a deal and make an offer that makes both parties happy – but an estate agent can. So, you should definitely expect your real estate agent to help you find a good deal, a well-negotiated deal that matches the buying/selling price you had in mind.
Also, let’s not forget that an estate agent knows the local market better than any platform. So, you can always expect your broker to find properties that haven’t even been enlisted online yet. And, you can expect a local broker to find your dream property without having to house hunt too much, another crucial thing a machine cannot do.
According to the Dubai Chronicle, Dubai has over 5900 active brokers and over 2200 registered brokerage offices as of 2016. If you look at that number in terms of financial gains, the total value of the commission of these real estate agents and brokers was over 1.5 billion AED – and that is just the 2 percent commission that these agents have made. So, in the long run, real estate agents and brokers play a vital role in promoting the Dubai real estate market.
Even though 25 million people are expected to visit during the Expo, it is the marketing skills of these brokers that will ensure the steady foreign investors who are looking to buy property in the Dubai market. While every property investor knows that the demand for property is set to increase and that means a steady increase in rental incomes, it is these estate agents that really know the local market – without their expertise, investors wouldn’t know which area to invest in, what kind of property to buy and how to recover their investment.
Secondly, it is these very local estate agents that will be hired by visitors to find rental accommodation during the Dubai Expo of 2020. So, if you hire an estate agent before, during or post the Dubai Expo to buy a property, you can be pretty certain that this estate agent will help you put your property on the rental market – after all, which investor doesn’t want a quick return on investment? Even in the long run, estate agents will play a major role in boosting the real estate market and creating a ‘healthy’ real estate market.
According to the ‘Construction in the UAE – Key Trends and Opportunities to 2023’ report, the economy of the UAE is expected to thrive within the coming five years. This report concludes that the development projects in Dubai, along with the upcoming residential projects, will boost an investors’ confidence, which will bring more and more foreign investment in Dubai, especially in terms of property investment.
Also, the residence visa through property ownership is another reason that investors are flocking to the Dubai real estate market. Dubai is all set to become the center of real estate investments and real estate opportunities post the Dubai Expo of 2020, which will totally and completely change the image of Dubai in the global market.