The Dubai Land Department (DLD) has instituted a ranking system that aims to encourage competition and enhance transparency in the market. The move sets benchmarks in the real estate profession and has received mainly positive response from the industry, although some insiders believe it can be further improved.
The system allots 40 per cent of the total score to a firm’s adherence to real estate regulations and laws, while 30 per cent is for sales transactions. Experience accounts for 15 per cent, the company’s structure contributes 10 per cent, while Emiratisation and CSR initiatives combine for 5 per cent.
The DLD has launched an app, Dubai Brokers, that provides data about the brokers and their rankings, as well their transaction history. The app can be downloaded through Apple’s App Store and Google’s Play Store.
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Over half of the rating looks at the professionalism of the agency, but some real estate professionals feel that while including sales transactions is necessary, giving it a weight of up to 30 per cent might not offer a clear picture of the actual performance.
“The number of transactions only reflects sales concluded within the secondary market, and no off-plan sales are recorded on this,” says Mario Volpi, Chief Sales Officer of Kensington Exclusive Properties. “Unfortunately, many individuals are therefore not credited with these sales. Also, not including these transactions means that some real estate companies remain in the general category as opposed to a higher grading, if these were to be included.”
Based on the final score, the system groups firms into four categories: General (0- 70 per cent), Bronze (71-78 per cent), Silver (81-80 percent) to Gold (91-100 per cent). None of the brokers that have been ranked are currently in the gold category, while most are in the General and Bronze categories, with a few in Silver.
Problem
Volpi says sales coordinators employed by firms to support sales consultants in the paperwork and coordination with the DLD are sometimes credited for a sale. “I realise that it is difficult for the DLD to police this, as whoever is present at the transfer gets credited with the sale by the DLD,” Volpi says.
The system stipulates that up to 20 per cent could be scored based on the number of sales transactions, and up to 10 per cent for the value of the transactions by the brokerage as a whole.
“The size of transactions may only partly reflect how good the agency is,” says Richard Paul, Director of Residential Evaluations at Cluttons. “For example, agents who only specialise on leases may get lucky and sell a full building at some point, and would therefore get a higher rating.”
Professionalism
The systemtakes a milder look at the records of deals, quality of systems used, websites and market case studies. However, messing with the regulations attracts warnings and lowers an agency’s score by 5 per cent for one or two warnings, and 15 per cent if there more warnings issued. Irregularities discovered in dealings, meanwhile, would cost an agency 25 per cent of its score if it is committed in at least three instances, and 15 per cent if it commits the offence once or twice.
However, Paul says that adhering to regulations should be a given in the industry. “There is no need to rate it,” he says. “People shouldn’t use an agent that doesn’t comply 100 per cent with the rules.”
Points for experience were given according to the length of operation or employment in the market.
“Experience is certainly important,” says Paul, who also suggests the inclusion of direct consumer feedback. “Customers could give their opinion on who does a good job and is trustworthy, for example, when they register their title deeds.”
Paul Christodoulou, Chief Operations Officer at Aqua Properties, adds another general gripe: realty firms or agents misrepresenting the properties they sell.
“[Many] real estate companies are not doing enough to market their clients’ property,” says Christodoulou. However, advertising a property that is different from what an agent is selling remains a grey area.
“Sometimes the unit is not available if it is still leased. So you have to find something, which has the same views, etc. — it has to be identical,” says Christodoulou.
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