- Broker Directory
- My Tools
- News & Advice
- Market Trends
- Other GN Sites
Everyone agrees duplicate listings are hurting the real estate industry. Efforts to address the issue are gaining ground, but industry insiders say the support of all brokerages is crucial. Some have proposed implementing a regulated multiple listings service (MLS) and getting everyone to toe the line. Dubai's Real Estate Regulatory Agency (Rera) had taken a step in this direction when it announced Simsari (today known as eMart) over three years ago, however, only a few brokerages have jumped on board.
According to Daniel Hart, CEO of Masterkey, who helped test Simsari, eMart remains a portal of verified listings instead of an MLS, and has been underused because it requires all property details to be made available, which agents simply couldn't always provide.
''It was the right idea. Agents were interested initially but found it difficult to use,'' says Hart. ''For example if the property owner's phone number was different to Rera's records, the system would block the listing. The Dubai Land department [DLD] rightly wants to stick to the highest-quality information, but we live in an imperfect world.''
Nevertheless, Ejari, the authority's tenancy contract registration portal, does encourage brokers to be on eMart. Exclusive Links Real Estate Brokers is one that lists its rental management contracts under the system.
''Approximately two weeks prior to lease expiry you can list your properties on the DLD's eMart directly from Ejari,'' says Louise Heatley, Managing Director of Exclusive Links. ''It's a very quick and easy process. However, we only do this for properties that we manage as downloading individual properties manually can cost excessive time.''
Eliminating the problem
The use of eMart is voluntary. Marwan bin Ghaleita, CEO of Rera, stated over a year ago that agents had asked him to hold off implementing eMart, although he proposed to allow three different agent listings of the same property rather than just one.
''An MLS shouldn't allow any duplicate listings,'' says Hart. ''Technically this suggestion is implementable but in practice not enforceable. The market needs to understand the advantages.''
A true MLS mainly allows agents to see each other's listings and work together in a transparent framework of information, pricing and commission sharing. ''Agents do want an MLS because duplicate listings are a problem,'' says Hart. ''In the US and Canada you can't list without using an MLS, but in Europe they haven't implemented full MLS yet either. In Dubai we're trying to get it going. We need 80 per cent of agencies to participate, but only have 15 per cent.''
Hart says duplicate listings cost agencies up to Dh1 million a year, attributing around 70 per cent to lost time, 10 per cent to increased overhead and the remainder to marketing costs. ''MLS can help attract professional agents, but you need a large percentage to find and eliminate duplicate and fake listings,'' he says.
Mark Towers, Managing Director of Edwards and Towers, uses eMart and supports the use of a Rera-controlled, mandatory MLS system. The market is flooded with differing information from different agents about the same property, ''which at best is confusing but at worst can lead to bad practices that put the customer at risk,'' says Towers. ''We support any initiative that drives the market towards an MLS system, but it's obvious that the reluctance of agencies to use eMart reflects on their commitment to provide honest, accurate information about properties they advertise.''
Underhanded practices include agents listing properties no longer available as a way of getting information from potential buyers and tenants and directing them to the scheming broker's properties, and listing properties below the price that the owner agreed to. The latter often happens when a property is listed by multiple agents. In such cases, some agents list the property at a lower price so potential buyers are more likely to call them as opposed to the agents who advertise the correct price.
''This means that the customer has filtered out the honest agent [who listed the correct price],'' explains Towers, adding that owners could be at risk when they deal with such dishonest agents. ''With an MLS system in place, this will not happen. The public could be confident that all properties are advertised truthfully.''
Two private MLS systems were launched last year — PropSpace and Masterkey's Airlist. ''The ideal scenario would be to have just one MLS to eliminate duplicates, but as long as agents get used to working together, the way it is today is fine at this point,'' says Hart. ''We can complement each other. We allow agents using competing software to list on our MLS.''
Alex Nicholas, CEO and Co-Founder of JustProperty.com and Propspace, believes the DLD is making progress, but notes that it takes time to build a good MLS. ''Getting thousands of agents on board took PropSpace years,'' says Nicholas. ''The system encourages agents to share their exclusive properties with their fellow colleagues in the industry and to work more closely together.''
He notes that landlords though still largely shun exclusive listings. ''Duplication of listings is the result of regulation,'' says Nicholas. ''As along as it's legal for a landlord to list with multiple agents, the same property will be listed more than once.''
While appreciating the usefulness of both services as a customer relationship software (CRM), Towers points out that there is no guarantee existing MLS systems would be populated with accurate data by agencies.
''Being voluntary with no regulation on data posted on websites, we're still not at a level you would see in markets such as the UK and US,'' says Towers. ''Although more established portals are asking for proof of title deed and owner details, even the best portals struggle to get agencies to list verified properties — meaning the majority advertised
However, in a statement, JustProperty.com said Propspace has been launched in the US and UK this year, giving it ''a first hand view into how MLS and regulation enable transparency and trust in the property sector''.
Towers also recognizes that agents often deal with owners who refuse to sign the DLD's standard contract, or form A, which formalizes dealings between seller and broker, and give title deed and passport details before an offer is made. ''This means the agent cannot check basic details about the owner and property,'' says Towers.
But Hart clarifies that privately run MLS systems bring the technology, not the legal framework, to the table. ''The MLS is the technical system, which facilitates sharing,'' says Hart. ''The rules for commission sharing, duplicate listings, etc, are usually set by a real estate association, or in Dubai and Singapore the government. In our case, we're just putting the technology. We can only warn agents when they list a duplicate [property], but as they get used to the system we will tighten our rules, including enforcing the need to sign form A.''
Nothing to lose
Although it's free, only 30 per cent of Masterkey CRM users take advantage of Airlist, but Hart believes the market is on the right path. ''We need to capture half of the agencies to swing the market the other way. We have to repeat the message over and over to agents and owners that when they list with one agent, other agents can still see it on the MLS and propose a buyer. So an owner has nothing to lose.''
Capturing more of the market and sharing the listings between CRM/MLS systems is paramount. As a larger broker, Exclusive Links reverted to using its in-house website portal and CRM, because the out-of-house system didn't add enough value in terms of contacts.
In addition, cost, security and timing would be some of the deciding factors to use or not to use an MLS, and Heatley was also concerned about limited marketing opportunities, unverified and out-of date listings, and a third party taking control of her agency's system, which raises to information security issues.
''Having said that, I do think for smaller companies it may be more beneficial to use a tried-and-tested system that could avoid them having to do this in-house at a higher bulk cost. It helps with cash flow, flyer designs and standardisation,'' says Heatley.
Hart says brokers shy away from anything that looks like an investment, but is happy the way the market is catching up. ''It will take a couple of years for MLS to become a trend, which includes the need for market recovery as brokers are cash-strapped.''
Does Dubai need more agents?
Despite a slow market, the rise in the number of property brokers shows no sign of abating. Agents say this trend is not good for the market. ''There are too many real estate companies in Dubai, considering the city's demographics and population,'' says Louise Heatley, MD of Exclusive Links Real Estate Brokers. ''This can negatively impact standards as companies fight for business to stay in operation.''
The number of agencies registered has increased by around 200 from September to November last year. ''Several things have happened, during the boom times; individual agents wanted to make more money themselves,'' says Daniel Hart, CEO of Masterkey. ''Let's say, ten agents of a brokerage of 20 left to create their own agencies. Then during tougher times, like now, many firms have gone out of business and agents left without a job decided to create their own agencies.''
Although it seems like a logical step, some complain it is making it tougher to operate in the market.
''It is true that there a lot of new brokerages and I believe that the current market conditions will make it tough for all agencies,'' says Mark Towers, MD of Edwards and Towers. ''Many of our deals in these times are with clients who have used us before. An agent who knows his area well and concentrates on a smaller patch with good, long-term relationships will always be able to rise to the top.''
As far too many agencies want a piece of the pie, the quality of services is seriously affected.
''With the excess of real estate companies, we are aware of our competition putting property prices lower than the requested marketing price from the seller, and, therefore, undercutting other agents offering the same or similar product,'' says Heately. ''These are poor industry tactics and do not help the market.''
Many agencies also do not provide accurate details about the projects they list. ''Enforcing things like accurate images will be hard to control,'' says Alex Nicholas, CEO and Co-Founder of JustProperty.com and Propspace. ''As the market matures and becomes more self-governing, there will be a shift towards accuracy and authenticity of information.''
Heatley believes that buyers are at a disadvantage when they look at listings. ''In Dubai it is often about the quality of the listing, rather than quality of the agency, and buyers feel a listing quality is based on the lowest price available,'' she says. ''Those agencies trying to uphold standards and abide by regulations can find it difficult [to be competitive].''
Dubai has been proactively working on improving standards in the industry. The latest efforts include ranking brokerage firms based on performance, which was implemented in January.
''The quality of agencies has always been questionable over the years, but this will change,'' says Hart. ''The barrier of entry is becoming higher and will sort this issue. Agencies will consolidate in the future; indeed some of that is happening already now.''
Get a glimpse on what's feeding retail across the UAE?
Source: Nicole Walter, Special to Property Weekly