Why are Abu Dhabi Brokers so Bad – And What Can You Do About it?

Why are Abu Dhabi Brokers so Bad – And What Can You Do About it?

It is a reasonably well known fact that brokers in Abu Dhabi are of a pretty low standard, more so than you would get in lots of other jurisdictions in the rest of the world (although real estate brokers get a pretty bad rap the world over). Most professions in the Emirate are done pretty well, why have brokers fallen so low? Quite a few reasons conspire to create the Abu Dhabi Broker, some are obvious and some will surprise you.

They are cheap to employ – If you are only paying your staff commission then you just have visa and insurance costs to pay. If people are cheap to employ then their employers don’t take the time to select them carefully or train them. There are some firms in Abu Dhabi who go through hundreds of brokers a year spending no time or money on them. Now that brokers will have to take tests to be regulated by the Abu Dhabi Municipality they will be more expensive to employ, but I suspect lax enforcement will mean not many people sitting the exams.

They Are Unqualified – Many jurisdiction the world over have long and detailed requirements for you to qualify as a real-estate broker (some even require a degree in real estate). This means that those brokers are both well qualified and that they are focused on a career in real estate. In Abu Dhabi new exams have been introduced which will help, but generally local brokers are from all sorts of other walks of life with varying levels of experience.

They Have Been Unregulated – There is now a new regulatory body for real estate brokers but hitherto there has been no-one to complain to about bad brokers. Couple that with the UAE courts averaging over two years to enforce a contract and no detailed law against misrepresentation means that there is very little recourse against a bad broker.

Reputations Don’t Matter – Abu Dhabi is a transitory city where most people don’t own their own homes. A lot of people will interact with only one or two brokers during their stay here, reputations in such an expatriate dominated city count for little as people don’t stay long and mostly rent. Some firms in Abu Dhabi pay more for online advertising than they do on wages as the majority of people will search for property on the internet first. All these brokers want are the leads coming in from Dubizzle and they don’t mind bad service. This where you can help, both the market and yourself – don’t respond to adverts, get a recommendation from a friend or colleague and work with that broker. Make reputations count.

High Turnover – Most expats don’t stick around in Abu Dhabi much longer than three years, so it is difficult to get experienced brokers and keep them as they often move country. This results in an endless stream of “rookies” who take a long time to learn the ropes and annoy a lot of tenants in the process. Short life-spans of brokers also means little is invested in training.

Vacant Units – Most of the world will show prospective tenants units that are coming available but currently tenanted. The landlord has time to rent the unit as he is still getting rent from the current tenant, he also wants to keep that tenant sweet, so he uses a good reputable broker. Due to cultural sensitivities the UAE has lent more towards only leasing empty units. Once a unit is empty the owner is losing cash so needs to lease it fast, this means they don’t care which broker brings them the tenant, they just want to spread the net as wide as possible. So landlords aren’t picky about the reputations of brokers either.

Who Pays the Fees – In most of the world brokers are assisting landlords in renting their property, so the landlords pay brokers for their assistance. In Abu Dhabi tenants pay, why is that? Most property on the island of Abu Dhabi is owned by around forty or so very wealthy families. With such a small pool of ultra-wealthy landlords they didn’t feel that they wanted to pay brokers to bring them clients, in fact a lot of clients went straight to the building they wanted – so if you’re not paying then why care about the quality of the broker you use?

Super Rich Brokers – Contrary to popular belief rental brokers are not making huge amounts of money. This is mostly due to property managers getting in on the act – as part of their management fee they get from landlords they take half of the commission a tenant pays, leaving the other half to the broker. If a job is badly paid then it attracts poorer quality candidates and encourages them to cut corners. You might be reading this paragraph sceptically  thinking they get paid a huge amount for doing nothing. If let’s say a person spends on average a third of their wage on rent, then at 2.5% commission a broker will need to rent 120 properties like yours a year to earn what you earn. One every two days. Brokers lease on average one apartment per week.

Tenants Themselves – This where you come in. Something people don’t understand about the Abu Dhabi market is that most brokers have access to the whole stock portfolio. Tenants generally go on Dubizzle, see what looks like the perfect place and call that broker. Tenants then put up with shoddy service to get their dream place, not knowing that a good efficient broker could have got them the same unit with half the hassle.

Tenants also often call brokers about a property and are either told that property is not available any more or are taken to a different property – they then stick with the same broker to see other units, even though they have proved untrustworthy.

Lastly if you see a great unit online listed with a lot of different prices and you choose the listing with the lowest price it is likely you have just called the most untrustworthy broker of the bunch. Some brokers list units at artificially low prices to get the call and then tell you the real price once you’ve seen the unit, don’t fall for this.

Ben Crompton is a former lawyer and Managing Partner of Crompton Partners. Visit their website at https://cromptonpartners.com and follow him on twitter @benbcrompton

Ben Crompton

Managing Partner


Call – +971 50 6145199

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