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A research-driven tool that could potentially create more transparency and stability in the Dubai property market is being expanded to cover the rental scene. Cavendish Maxwell launched Property Monitor to provide real-time information on property transactions earlier this year, but has broadened the monitor to include rental data as of this month.
Adam Wisher, the company's Head of Development Advisory and Real Estate Research, says the tool has been two years in the making and relies primarily on data from banks processing mortgages as well as other approved partners with reliable information, such as agents and developers.
''When we came to business about two years ago we saw we had a massive amount of data in our international valuation business, which is one of the biggest [in this market]. We started to think 'Who else in the business is interested in our data?'''
The property valuation firm's core clients are banks, property developers and investors, he says. ''Our key value-add for them is information and I think if they're trying to lend on an individual mortgage or build a multi storey tower, they all need access to credible information to make those decisions. ''The market was crying out for it and it was a natural fit for us.''
A step forward
Such monitors are de rigueur in more established markets across the world, but Wisher says the region is lagging behind and a tool like this is an important step in the advancement of a relatively new market. ''It is a massive step forward, potentially a landmark point.''
Having a clearer picture of what is happening on a daily basis will also help analysts identify trends and give some greater level of assurance in the market, which should lead to greater stability, he says.
''This tool's not going to do that alone; there are various factors at play, but I think it's going to be one of the tools that could help do that. What everyone wants to create is as near to a transparent market as possible. Dubai still has some way to go, but this will help.''
The paid service, which can be tailored to individual needs and is priced on application, has already proven useful for buyers and sellers, as well as property agents. Wisher says because property markets change so rapidly, people are increasingly making decisions on real-time data updaters such as a property monitor. ''That's really what clients are looking for.''
The information is based on data from the firm's valuation business as well as reports from partners, but not directly from government sources. ''Over the past two years, we've worked to build relationships with local developers agents and banks to source more information. There are many people who work to verify the information to ensure its credibility.''
The firm has dedicated personnel who work on data valuations. ''[These are] credible valuers who are experienced in the market and that's key,'' says Wisher. ''Anyone can take data from different sources, but people who are [experienced] in the market are really important.''
The information is both up to date and has a high level of detail, including property plans, areas and specifications, as well as particulars such as transfer dates. ''The valuations and the agents get this information, the [agreement] is signed and is live and active — that's where our data comes from.''
Those details are crosschecked against a number of sources, including a chartered surveyor who can identify any anomalies.
Not a crystal ball
But Wisher is quick to point out the property monitor is not a crystal ball, just a reflection of what is actually happening. ''The focus of this is not to predict the future; it's a tool to understand today.'' Wisher explains that an investor should be looking at such data to get as much knowledge as possible about the health of the market and look at any trends, especially given the volatility the young market has experienced in recent years.
''In Dubai, the first cycle was very clear in 2008, but what we know this time is the trend has been very different in terms of the decline [in sales], so it's difficult to forecast what's going to happen in the next five years based on what's gone previously,'' says Wisher. ''All we can do is try and understand what's happening in the market to inform those decisions.''
Despite access to increasingly up-to-date information, there is always uncertainty in the property world, he says, especially in emerging markets — and the monitor is not a silver bullet in creating absolute certainty.
Cavendish Maxwell also launched a property monitor for Abu Dhabi at the start of the year and is planning to replicate the model around the region once operations in Dubai and Abu Dhabi are well under way.
''We have a long way to go in terms of establishing the tool,'' says Wisher. ''We're two years into the initiative but it's not a finished product. We're getting more data in more locations. We'll focus on that, but it's potentially a model that could be applied to other non-transparent markets.''
Source: Amanda Fisher, Special to Property Weekly