By Soren Billing
New system will limit activities of brokers and areas in which they can operate.
Dubai’s Real Estate Regulatory Agency (RERA) has launched a four-tiered classification system that will reduce the number of estate agents operating in the emirate.
Under the colour coded classification system, tier one brokers will be issued a blue licence by the Department of Economic Development (DED), which allows them to carry out all types of broker activities and to operate throughout the emirate.
The next step down will be the yellow licensees. These will be licensed by free zone authorities to carry out a full range of brokerage activities in that particular area.
If a free zone authority does not own freehold real estate it will not be able to issue licences.
Tier three registered brokers, or green license holders, will be authorized by the DED and registered by RERA to sell only the properties of specific companies or developers.
Tier four licensed brokers are those issued with a red licence, registered by RERA and authorized only to promote, sell or rent time share units.
The new licensing system is linked to RERA's online resource and the forms available on the website for licensing.
Based on their tier, brokers will only have access to properties within their sphere of operation only. The system will not allow them access to property they are not qualified to sell.
"The big change is that broker licences will now be linked to specific areas. We will no longer face a situation where someone licensed by a free zone which owns no property can be registered to sell real estate in other parts of Dubai,” said Mubarak Al Jafla, RERA's head of broker registration.
"The overall effect will be to limit the number of licensed brokers selling property in Dubai to those who are able to offer a professional, expert and dedicated service."
Estate agents can apply directly to RERA for their new licence immediately or wait until their current licence has expired, the agency said.
This is excellent news for anyone who has had to deal with a real estate agent in this town. They are the scum of the earth, sitting in their grimy offices waiting for the money to roll in. The rudeness, the arrogance, the incompetence and the greed are towering, so it is high time these scoundrels were booted out. Some of the big Western names are not much better, so here's to a professional approach at last.
John I agree! We love this country and we want to have decent lives without being robbed by rude unskilled arrogant and greedy real estate agents! However we need to be careful that this move does not create a monopoly, and we all know how these monopolies manipulate the market and the prices!
I am married to a real estate broker and she does not "sit in a grimy office waiting for money to roll in." Bear in mind that brokers are paid by commission and, with the current drop on both the number of transactions and the value of each, she has to work very hard to achieve half the income that she was earning a year ago. She spends at least two hours every evening after she gets home mainly taking calls from and resolving problems for prospective clients. Typically clients will blame her if an apartment that they saw two weeks ago but either could not make up their minds or they did not have the deposit ready has now been let. She also has to deal with tenants and landlords who may both have an unrealistic view of what a property is worth. Believe me, there are as many bad clients as there are brokers and our resident whingers should maybe look in the mirror before they criticise others.
I hope they also look into the extortionate fees that are currently being charged by agents, especially in leasing, paying 5% to somebody who 50% of the time doesnt turn up, and the other 50% turns up an hour late, has absolutely know idea what they're talking about (but you can guarntee 90% of it isn't true). I feel 1-2% is the maximum you should be paying them, currently it works out you'll be paying $1360 in comission for a one bedroom apartment, to have somebody make you sit in recpetion for 40 minutes, then unlock a door, seems to a touch on the expensive side
Agree with Karim, sounds like a recipe for raising prices Reduce the number of agents making it harder to get a property and therefore making people willing to pay more to jump the queue. Regulating the rules of engagement in the market would be a far better way to root out the incompetent morons in the market... but wouldn't raise prices!
Although this is a positive move, but one would wonders why not earlier ? Why RERA waited so long to do this ? Now that a lot of damage has been done and several investors were treated unfairly by incompetent and sometimes bogus brokers, we wish we could see these regulations earlier and during the real estate boom....
In my experience over the 16 years I have lived here there are very few real estate agencies that are any good. Sometimes you can get the service of one good employee but when they leave you are left at the mercy of the other bandits that remain. One very famous company that pretends to offer homes that are better is probably one of the most unprofessional I have ever encountered. Don't think that by sticking to the big companies you can escape the sharks.
This is another one of the dumb ideas to strangle the real estate guys who are already affected heavily by the crisis and specially the few that are left in the market. It will serve no purpose now. Its all about service and nothing more, let the laws of economics guide the market - why use color codes to play around. Please think about increasing the attractiveness of Dubai property and dont kill the agent.
I am all for culling the hordes of vultures that circled the property market and helped fuel the chaos of the last few years. Most were dishonest chancers at best. What is not clear is whether this forces people to use a real estate agent. If you have a house and you want to sell it to someone, do you have to use an agent? Can you stick it on Dubizzle yourself and deal direct with a buyer? If the intention is to force you to use a licensed real estate agent and remove the option of doing things yourself, that would apply a further cost to buyers/sellers and damage the market further. From a revenue point of view, it's probably a bit late to start trying to milk some extra fees from the property market - the time to do that was 2-3 years ago.
Instead of wasting time with color codes, the authorities should invest their resources into improving the regulatory structure in Dubai so that buyers, realtors and developers can all benefit and the level of confidence in the market can improve. Why re-paint a crumbling house when you clearly need to examine its foundations?