REST - Does it spell the end of the property broker?

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REST - Does it spell the end of the property broker?
Working together, the agent and the property owner should agree on a pricing strategy.

dubai - A good broker will utilise their buyer/ tenant records to cross sell properties

By Lewis Allsopp
 VIEWPOINT

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Published: Tue 19 Jun 2018, 4:48 PM

Last updated: Tue 19 Jun 2018, 6:50 PM

On May 29, the director-general of the Dubai Land Department, Sultan Butti bin Mejren, announced the Real Estate Self Transaction (REST) platform.

Part of the announcement read "the complete digital management of real estate transactions, eliminating paper documents and reducing brokerage procedures," enabling the buying, selling and leasing of property to happen via the platform.

"Reducing brokerage procedures" has been picked up by many. Does this mean there will no longer be a need for real estate brokers? Will buyers, sellers, tenants and landlords just transact with each other?

With that in mind, I want to examine the role of the broker and give my view on whether this will be the end - or whether brokers can offer things that technology can't.

First, I must say that the REST technology is fantastic and will greatly help people with property transactions.

Let's start with selling or leasing a property. A good agent will work with an owner before listing the property. They will discuss current market conditions, recent transactional evidence, comparable listings, current demand, buyer or tenant profiles and current market trends. Working together, the agent and the property owner should agree on a pricing strategy.

Theoretically, some of this can be done by the property owner utilising transaction data and looking online for comparable listings - but they will only learn so much from this and they lack the expertise of a good agent.

For example, evidence shows a villa in your area recently sold for Dh4,000,000. However, what the data doesn't tell you is that maybe that villa isn't in best condition and lies close to a main road. Therefore, you should really be asking for Dh4,200,000 to Dh4,300,000 for yours.

Conversely, the Dh4,000,000 property may have been upgraded and on a large plot. In this case, you should be aiming for slightly less. The danger of pricing too high is that you 'stick around' on the market. The longer a property is on the market, the harder it becomes to sell as a stigma becomes attached to it - "that property has been on the market for ages, there must be something wrong with it."

This is one of many possible examples and it's worth noting that transactional data is two to four months out of date, considering the length of time it takes for the transaction to go through.

In terms of photography and marketing, most good agencies will use a professional photographer, but even if not, the agent will know how to take pictures to make the property look most attractive. They will know how to describe a property in the most interesting way to attract potential clients. If you get the first image wrong, there's a good chance a potential client will skim past the listing and move on to the next one.

Viewings
On average, we take 27 viewings to sell a property. Clients rarely buy or rent the property they enquire about. A good broker will utilise their buyer/ tenant records to cross sell properties. A client can easily miss an advertising online, but once a broker knows it is in the market, you can be sure all their clients know of its availability.

On the viewings themselves, part of a broker's role is to problem solve for clients. Human nature dictates that a 'viewer' won't, in 99.9 per cent of cases, tell a property owner their real opinion of the property as they will feel awkward doing so.

A good agent will have the experience needed to suggest solutions for objections, share other's experiences of living in the same property type and what they have done.

For example, if someone feels a living area is too small, the agent might explain how people have taken down an internal wall, or extended the property at X cost. They would also know what the cost of a villa (Y) in that area with larger living space would be. In most cases, X will be lower than Y. So, clients go from not considering a property for a specific reason, to feeling comfortable there's a solution to their issue.

When it comes to negotiation, it's a fine art. People only become good negotiators through repeated experience. A lot of the time, someone's property is their biggest investment. A good broker will be negotiating daily and be very good at it.

The REST platform is a welcome addition to the market. It's going to provide a smoother, more efficient way of progressing deals. However, for the reasons discussed above, I feel good real estate brokers will still be very much a requirement; still have a huge role to play and most importantly they will continue to bring incredible value to their clients.

The writer is CEO of Allsopp & Allsopp. Views expressed are his own and do not reflect the newspaper's policy.


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