Specialized in buying, selling, and renting exceptional homes, Sloanes Real Estate is a boutique agency that managed to be one of the pioneers in the professional GCC real estate brokerage market. Invest- Gate goes behind scenes in real estate brokerage market across the region, mainly United Arab Emirates (UAE) and Saudi Arabia. Here is a special interview with Arron Browne, managing director of Sloanes Real Estate KSA, to give us insights on the market’s latest trends and current status.
What is your opinion about brokers’ role and how they are affecting the real estate market in KSA and UAE?
Brokers play a vital role in offering clients two elements a developer cannot; variety and options especially in the re-sale and developed market.
Developers are a great mean of going “direct to source” to get the best deal on their own product. However, brokers will not only often be able to offer the same product in case agreements have been made between agent and developer, but also provide an unbiased consultation on what the rest of the market offers, as well as price comparisons in either similar or alternative locations within city or region.
Not only that, but we are seeing brokers play an increasing role in offering a diverse international portfolio of investment opportunities, which allow interested parties to purchase property outside the UAE and KSA.
How do you see the real estate brokerage in the UAE differs from that in KSA?
Brokers offer a variety of options to the property market in different conditions, which otherwise may not be available; locally and internationally. The UAE has a great deal to offer in terms of the number of brokers and the variety of product, and KSA started to quickly realize that there is a need for property consultants who can be transparent in their advice on where buyers can invest their money.
KSA and UAE have advanced sales and rental markets. Developers will often avoid renting directly so brokers help investors rent their units and similarly offer renters options for a variety of tenancy agreements.
What are the challenges facing brokers in both countries?
Both KSA and UAE have authorities governing developers and brokers in the way they do business. These governing bodies are in place for exactly the right reasons; to ensure that buyers and renters are protected from the flaws, which can affect the property market. However, these evolving markets create more challenging laws and precedents that brokers must follow to the letter in order to operate legally in the GCC.
Brokers must be able to quickly adopt any new rules and regulations announced, without making that affect the normal flow of, typically fast-paced business. Additionally, the rules and regulations usually target brokers more than developers, as brokers have to be more closely monitored, given their association with multiple properties.
What is the nature of Sloanes operations in the GCC?
Sloanes Real Estate Brokers is a broker with offices in KSA, Qatar and UAE. KSA and Qatar’s offices were opened specifically to sell units on behalf of the Sabban Group’s respective development arms, Manazil LLC in KSA and Sabban Property Investments in Qatar. And our office in UAE was the first to open and act an independent agency that is associated with multiple developments for multiple clients, both developers and individuals.
In Qatar, Sloanes Real Estate Brokers has morphed from an exclusive broker for the Sabban Group to a fully independent broker acting in the same way as our UAE office. And this gives a perfect perspective when looking at differences between and benefits of developers’ sales offices or brokers.
Who makes sales better in your opinion, developers’ sales offices or brokers in KSA and Dubai? or is there a cooperation between both parties?
I am afraid I cannot state who is better at sales, leasing, or property management, but I can safely say that cooperation between both parties is the best way to sell units easily.
Developers’ sales departments are usually armed with more products and development knowledge; they have information on all units within the development. As for brokers, they may only have partial knowledge about units through some information provided to them, but they are certainly better equipped to give a more in-depth consultation and comparisons within the market. When developers’ sales departments and brokers work together effectively, they give investors a complete and transparent insight into property options in either KSA or UAE.
What is the market trend nowadays? Do people usually go online to rent or buy units? or go to offices in KSA and UAE?
From my experience, I would say that KSA and UAE differ greatly in this respect when it comes to selling property.
Our KSA office has little footfall as buying is not a common practice in that market. In Jeddah, you can see very few “high-street brokers”, whereas there are a huge number of offices in accessible areas with high demand in UAE.
However, our development in Jeddah, Bayat Plaza, has benefited greatly from having an on-site presence, where clients can see the property and especially the “show apartments”.
In terms of online browsing in both countries, I would say, again from experience, that the development of “property portals” has been extremely influential in buyer behavior. These portals allow investors to access hundreds or even thousands of complete and under construction properties offered by a variety of brokers or direct from developers, all on one site. I would say that browsing properties online is probably the most popular way, and hence brokers and developers alike use these portals to drive traffic either physically to their office or respective websites.
How do you see the real estate market nowadays and your outlook for it?
Real estate markets in the Middle East have been reportedly slow in the last few years, with prices dropping slightly across the board as more projects are completed and come online. The low oil prices since 2014 have also certainly affected many industries in KSA and the property market is not immune to this.
The Middle East now has a more controlled and normally functioning property market, where demand and supply dictates market activity and developers are more realistic with prices and delivery promises.
The regulatory authorities have made “flipping” process more difficult with necessary rules and regulations imposed to control unprecedented price hikes and empty properties with exceedingly high values.
Developments, such as Bayat Plaza, sold through brokers like Sloanes Real Estate aim to convince buyers that current market conditions produce variety and quality. Only property developers and brokers that are trustworthy and transparent, and can deliver true consultancy will be trusted by investors. And it is these quality outfits that will prosper and stand out in an otherwise slow market.