How Dubai is moving real estate transactions online

 

As the global economy becomes increasingly digitised, the Dubai Land Department (DLD) and its legal arm, the Real Estate Regulatory Agency (RERA), have aimed to stay ahead of the curve. In May 2018 they announced that they had begun developing the Real Estate Self Transaction (REST) platform, an online portal that will enable all aspects of real estate business to be carried out online, beginning from the service’s projected completion in early 2020. REST will form the real estate aspect of the Dubai Future Foundation’s Dubai 10X initiative, which aims to position all of the emirate’s government agencies 10 years ahead of their peers worldwide in terms of technological advancement.

New Functions

REST’s initial launch followed in October 2018 during Cityscape Global 2018, an international exhibition and conference on property development. The DLD underlined its interest in the integration of smart applications into the real estate market by co-organising the event under the slogan “simulating your property with artificial intelligence.”

REST will allow property transactions to be conducted remotely and without paper documentation by using blockchain cryptography to provide clear and unalterable transaction records. As an added security measure, REST will also allow users to activate face recognition tools to verify their property ownership.

The system is designed to span the whole spectrum of real estate transaction and conveyancing, including sales and rentals; mortgage provision, by linking buyers directly to banks; e-payments of bills for electricity, water, internet and other utilities; property management on behalf of remote investors; and interior design commissions, by providing digital renderings of floor plans and designs.

The platform will also provide access to information regarding investment returns organised by region, type and property use. Users will also be able to make enquiries about new projects, including the planned and completed stages of their development, the identities of real estate brokers and the value of transactions within those developments.

Downstream Effects

While the streamlining associated with digitalisation should be beneficial to many market players, there are concerns about REST’s potential effects on intermediaries like brokers, property managers and service agents. According to DLD data published in July 2018, there were 5181 registered brokers working from 2113 real estate offices who had earned Dh571m ($155.4m) in commissions in the first half of 2018. Industry observers worry that those earnings, which had already declined by 30% since July 2017, could be subject to further downward pressure as the market adopts and adapts to REST.

Public agencies have been careful to stress their support for brokers and their services. “We appreciate the essential role played by authorised and licensed real estate brokers, and we encourage customers to choose brokers who hold real estate broker identification cards,” Yousuf Al Hashimi, deputy executive director of RERA, total local media upon the DLD’s release of statistics for the first half of 2018. “In addition, certified brokers contribute to support the vision of the DLD by enhancing the process of real estate transactions in the emirate.”

Moreover, even as REST could prove to be a major disruptor of off-plan – or pre-construction – property transactions, in-person viewings will continue to be integral to services for completed and second sale properties, for homebuyers if not for investors. The consensus among experts from several real estate research houses is that REST will not replace brokers, but will exert pressure on them to differentiate their services. As Harmen De Jong, a partner at the property consultancy Knight Frank, told OBG, “REST will force brokers to prove they are providing added value. They will have to focus on their core services: linking clients to the properties most appropriate for them.”

You have reached the limit of premium articles you can view for free. 

Choose from the options below to purchase print or digital editions of our Reports. You can also purchase a website subscription giving you unlimited access to all of our Reports online for 12 months.

If you have already purchased this Report or have a website subscription, please login to continue.

The Report: Dubai 2019

Construction & Real Estate chapter from The Report: Dubai 2019

Cover of The Report: Dubai 2019

The Report

This article is from the Construction & Real Estate chapter of The Report: Dubai 2019. Explore other chapters from this report.