Bad rap for real estate agents

Bad rap for real estate agents.

How fees are paid
In most parts of the world, brokers help landlords rent out or sell their property. This means landlords pay brokers for this service, but in the UAE tenants tend to pay.

Historically, there was a small pool of ultra-wealthy landlords that did not want to pay agents to bring them clients; in fact many tenants went straight to the building they wanted.

If you have tenants paying agency fees, this affects how landlords choose which broker to work with. If you’re not paying for the service, then why care about the quality of who you use?

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Lack of exclusivity
Landlords in the UAE often avoid giving brokers exclusivity on marketing their properties, something that allows sub-standard agents to find work.

If a landlord exclusively works with a single broker, they tend to pick what they consider the best one.

If they don’t, then any broker who cold calls them can get involved. They believe the more brokers market their property, the higher the more chance of having it rented or sold.

However, this can lead to agents not spending much time on any particular unit. Consider the number of times tenants are told to just go to the building and the unit is open.

Ten agents may be working on the same unit but only one has a chance of closing the deal so, it’s likely the majority will not spare the time to do a viewing.

Regulations
The UAE is a young country, therefore its regulations are continuously evolving.

However, the Real Estate Regulatory Agency exam is pretty taxing and Abu Dhabi has tests to pass now too, but these do not approach the difficulty and length of qualifications in other, older, real estate markets.

This again is part of the transitory nature of the Emirates: if you are in your home country and looking to be a real estate agent then investing time and money in studying and passing exams is well worthwhile.

If you are only going to be in the Emirates for a few years then it is less valuable to truly understand the laws and market here.

High turnover
The high turnover we see among residents also applies to real estate agents. I have lost track of the great staff that have left because they were a trailing spouse (male and female) and their partner moved on to another opportunity.

This results in an endless stream of rookies who take a long time to learn the ropes, annoying many clients in the process.

The short lifespans of UAE brokers also means little is invested in training.

Companies in the real estate industry need to invest more in training their staff which will in turn will improve the standards of customer service and the knowledge base of agents.

Customer service
An understanding of good customer service and business conduct differ wildly across the globe.

I had a meeting last month with an eastern European, an Emirati, an Arab national and an Indian national and the attendees arrived in dribs and drabs with some up to 30 minutes late.

I will not tell you who arrived when, but everyone felt they were on time. Equally customer service varies between continents, so while the broker may feel they are offering great customer service, the client may disagree.

Hiring costs are low
Real estate brokers are cheap to employ. If real estate agencies are only paying their staff commission, then they only have the visa and insurance costs to pay.

If employees cost little to take on, then their employers do not take the time to select them carefully or train them. Some firms in the UAE go through hundreds of brokers a year, spending little or no time or money on their career progress.

Brokers are not well paid
Contrary to popular belief, most estate agents are not making huge amounts of money. Yes, some of the great ones are earning well, but most do not earn enough to be the main breadwinner supporting a family.

This means the industry either attracts young single employees with low overheads, the less well educated or “trailing spouses” whose partner makes the primary income.

While some brokers flout regulations, deliberately mislead clients and are just generally dreadful at their jobs, others have great potential.

If I had three wishes: landlords would pay real estate agents instead of tenants; regulators would take a pro-active approach in going after illegal brokers and clients would seek a referral for a good broker as opposed to clicking on pretty pictures or the lowest prices. Good performance needs to be rewarded.

Author: Ben Crompton

Source: The National