Harder times are ahead for real estate agents in Dubai. A number of new measures are about to be introduced by the emirate’s Real Estate Regulatory Authority (RERA) in an attempt seed out brokers in the sector and allow only the top performers and qualified professional to stay in business.
Earlier this week, during a seminar at Cityscape, RERA’s CEO Marwan bin Ghalita announced that four new measures will be rolled out in order to increase the agency’s control over real estate agents in Dubai. According to him, that was necessary since the amount of practicing brokers and brokerage firms in the emirate continued to be too high. RERA has estimated that currently there are over 5,000 brokers working in over 2,200 companies in Dubai. In addition, in 2014 alone, the number of new brokerage firms has jumped by nearly 570.
The first regulation that will soon be adopted in Dubai, will increase the passing marks in brokers’ mandatory tests by 10%. Until recently, real estate brokers in the emirate were required to reach at least 75% on the test, but very soon that bar will be raised to 85%.
The second measure will entirely cancel broker cards. Instead, however, it will link broker registrations to the Emirates ID. The next regulation will limit the number of broker visas for brokerage startups to just four. Also, any future changes in the amount of the visas will directly depend on the company’s performance.
The final new measure that will be introduced will cancel the registration of any broker who does not make a transaction for a period between six to twelve months.
In addition to that, Marwan bin Ghalita informed that Dubai’s Real Estate Regulatory Authority will try to make the agreement between the agent and the seller, known as Form A, mandatory. Once that happens, a seller will only be able to list and sell a property though a Dubai broker if he or she has signed such a contract. Sellers will also be able to make a limited number of listings, as soon as the multiple listing system comes into force.
RERA, however, seems confident that the new regulations will be successful in reducing the practicing brokers and brokerage companies in the emirate. At Cityscape, the agency’s CEO reminded that not long ago there were about 6,000 more brokerage firms, as well as 5,000 more agents in Dubai.
The Real Estate Regulatory Authority has estimated that the total value of property transaction in Dubai has increased to more than AED 155 billion over the past one year.