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Mon 7 Nov 2011 08:01 AM

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Group buying website to offer cut-price property

Grosper hopes to grow its membership to 50,000 through deals on rented apartments in Dubai  

Group buying website to offer cut-price property
The site is thought to be the first in the UAE to apply group buying to real estate

Grosper, a new group buying website, aims to get more than 50,000 members within its first six months by offering group discounts on property rentals and home-related services, its business development manager has told Arabian Business.

The website, which launches on November 15, has tied up with a Dubai-based property developer to offer group discounts on rentals, Mohammed Hingora said. 

“In the next six months we’ll at least we’re looking at 50,000 signing up. We have over 1,500 already based on the pre-launch marketing…I’m really positive about the kind of response we are going to get because the users here are very familiar with the group buying concept,” he said.

Hingora declined to mention the name of the Dubai developer but said the group would initially concentrate on rentals in Dubai before expanding to Abu Dhabi and Sharjah.

Online group buying websites have been gaining traction in the Middle East as merchants look to bolster their sales in the wake of the global downturn. The websites offer limited-life, no-strings discounts on items ranging from spa treatments, meals and hotel stays.

Competition amongst global market leaders is hotting up in the region as they look to grow their business outside of their home market. US-based LivingSocial in June acquired Dubai’s GoNabit for an undisclosed sum. Under the terms of the deal, GoNabit plans to expand into new markets and triple its number of staff.

The following month the Jordanian media company Jabbar Internet Group took full control of Dubai-based Cobone. Cobone is billed as the Middle East’s largest daily deal website with 600,000 members.

Grosper will offer group discounts of as much as 20 percent on apartments across Dubai for as little as three consumers, said Hingora.

“We tie up with developers in the UAE and take some of their inventory to put on our website. If for example, they have a building in International City, we put part of the inventory on our website saying three studios and if all three of them are rented within 14 days, then all three people get about a 15-20 percent discount,” he said.

Other discounts will include home cleaning services and furniture, added Hingora.

Groupon, which claimed 50 million subscribers at the start of the year, rejected a reported $5bn takeover bid from Google last year. The firm, despite being unprofitable, could be valued as much as $20bn in its planned IPO, analysts have said.

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@khalidfakhouri 7 years ago

Sounds fancy but I will keep my eyes on this to succeed. Best wishes for the founders and the team.

Concerned of Jumeirah 7 years ago

HIGHLY flawed concept! Is this legal? Has RERA authorised this?
Unless you have a very desperate Developer why would a they lower the price 20%? How much of that goes to this website? Legal Real Estate Brokers only charge 5% commission & that is paid by the Tenant, not the Landlord, so why would they throw money away paying a group website?

Most apartment rentals take less than a week for paperwork to be given & contracts to be signed, registered online with Ejari & payments to be made, so this 'wait 2 weeks to see if you get a discount idea' simply does not make sense. Who protects the Tenant's rights?

Real Estate should be left to professional Brokers who have paid for their Licence, office premises, staff training with RERA, advertising etc. & have good relationships with their Landlords, not a group buying website. Or is the price artificially raised to allow the discount?

Jake 7 years ago

I like that idea of professional Brokers! This should be implemented as soon as possible.

Arsalan Tabani 7 years ago

I think its a creative concept. Such initiations should be encouraged.

Although properties need to be seen and so many soft factors exist compared to buying a spa deal. While Group buying websites work on attracting impulse buying.

Further tapping a huge number of people is important, as for a a massive majority of people receiving the deal advertisement, it would be irrelevant based on time/location/budget/size e.t.c.

Girish 7 years ago

The more the merrier for the Buyers, now they have one more option to search for and compare the offers from Property Agents and Portal Agents ... Good Luck to the Team !!!!
Giresh

Jimmy Blue 7 years ago

Real estate in Dubai has been a 'highly flawed concept' from the beginning. Anything that will bring down the prices of rentals and purchases to realistic and correct levels is to be applauded rather than the continuing artificially high real estate costs that are not backed up by economic reality and kept artificially high by 'professional' real estate people. I would trust my money (as I have done on many occasions) with an international organisation like Groupon rather than a local agent. It seems to be that agents will be scared to see this sort of thing because its modern, slick and can work well doing them out of their poorly delivered services. Paying an agent 5% of nothing isn't a good investment is it, when there are thousands of unrented apartments all over the UAE.

Mohammed Hingora 7 years ago

Hi, I am the co-founder of Grosper.com and would like to thank you for your feedback.

To address some of your comments, we are fully compliant with all government agencies. Also, be assured that as and when we are required by RERA to take further steps, we will immediately do so. We work with developers directly and act as an introductory agent for groups (Similar to Airbnb.com for private rooms). Our aim is not to be a broker, and actually facilitate direct contact between customers and developers.

There is a huge gap between supply and demand in Real Estate in Dubai which is why developers are willing to reduce prices in return for a large amount of inventory being rented at the same time. This 20% discount does not hurt them because of the high maintenance charges they incur on idle properties.

Real Estate is a huge cost for most families in Dubai, and waiting two weeks can possibly save them tens of thousands of dirhams. We hope to reduce the time period over time.

Mohammed Hingora 7 years ago

Hi Arsalan,

Thank you so much for the kind words. We will also be doing curated home decor deals for our members.

Tapping a huge number of people is definitely important and we will be writing about our challenges and experiences on our blog - grosper.com/blog

Thanks

Farida 7 years ago

I think group buying in real estate is a great concept. www.groffr.com was the first in the world to start this concept and it is excellent to see the amount of discounts they can offer on the properties. Came across their website when I wanted to invest in a property in Mumbai, India.