Mario Volpi: How Dubai's new rules on property adverts will affect home sellers

I am a seller of a two-bedroom apartment in JBR and I have just been informed that there is a new legislation coming into force by Rera regarding the advertising of property. Can you please enlighten me as to what the details are so that I can be assured of being on the right side of the law? SG, Dubai

The ever-changing face of Dubai real estate with specific reference to tighter regulations is always, in my opinion, welcomed. Since the Real Estate Regulatory Authority (Rera) was formed in July 2007, it has worked tirelessly to implement better systems and passed regulations designed to protect all real estate stakeholders and consumers, agents, buyers and sellers, landlords and tenants.

Broadly speaking any changes to the regulatory framework are always made with the aim to improve the market, to protect all concerned and to ensure that the ease of doing business is maintained.

The latest Rera mandate was communicated to agents via email on August 10, 2016 and reported in the press last week. It came into force on Sunday, October 9.

The communication stated that all real estate companies and institutions that wish to publish any real estate announcements or advertise properties in print, online, radio and social media etc will now need to get a permit for each property to do so.

Great news, I hear you say and to a point, I too am happy that this is now a regulation, if only to stop fake adverts from littering our publicly visited property portals. What I do struggle with, however, is the mode of implementation. I am not aware any consultation was carried out among the agents and Rera before the email communication was sent, therefore nobody really knows how this is going to work as of yet.

Issuing the regulation but not explaining exactly how agents are expected to comply is not helpful. The permits will be applied for online via the Trakheesi section within the Dubai Land Department website.

With this mandate, another important announcement needs to be communicated to each and every seller or landlord who wishes to market their property via an agent. To comply with this regulation, they (sellers/landlords) will have to sign the Rera form A that agents normally request be filled in and signed when first listing the property. These forms were originally introduced way back in 2008 but only made mandatory in May 2014. The form A is the agreement between seller/landlord and the agent. This form can be viewed or downloaded on www.emart.gov.ae.

Previously Rera had said that a seller could list his/her own property with up to three agents only. This rule is definitely not being adhered to by the public, as some sellers list with anyone and everyone.

As agents, we do find it increasingly difficult to comply with the law owing to many sellers not wishing to sign anything at the beginning, especially this form A. This is very surprising, it is produced for their protection as well as the protection of the agent but nevertheless it still remains largely unsigned. With the new regulation in place, no agent will be allowed to advertise or market the property without it.

Both sellers and landlords will now have to change how they market their properties. They will have to work closer with their agents, not against them. Gone are the days of just putting their property on the market by verbally agreeing to do so.

To verify the ownership of the listing, the agent now requires copies of the signed form A, passport of the owner and title deed. They will proceed to pay for the permit to advertise by submitting the same again online. All of this needs to be done before marketing can commence. As a result, I’m sure seller fees will now also be more widely introduced by agents.

This new mandate will definitely create more work, but if in the long run it succeeds in cleaning up our real estate market, then I for one will be happy to put in the extra hours.

Mario Volpi is the chief sales officer for Kensington Exclusive Properties and has worked in the property industry for the past 32 years in London and Dubai. The opinions expressed in this article are those of the author and they do not reflect in any way those of the institutions to which he is affiliated. It does not constitute legal advice and is provided for information only. Please send any questions to mario.volpi@kensington.ae.

business@thenational.ae

Follow The National’s Business section on Twitter