New perks for Dubai property buyers: Share in broker commissions on off-plan sales
As Dubai offplan sales turn hyper competitive, brokers are in the mood to share rewards
Dubai: Buying a home in Dubai? If yes, how about taking a share of the broker’s commission too on the deal?
As sales commissions on offplan sales hit 10-12 per cent, more brokers are willing to share part of the proceeds they get from the developer with the property buyer. The latter’s take home from the deal could be even half of the commission. Plus, they get the home too.
Brokers are realizing that they have to offer more incentives to get potential buyers on their side. They need to do this as the offplan property market in Dubai turns hyper-competitive. “With multiple projects launching each week, private developers are jacking up commissions,” said an estate agent. “Which then leaves agents the flexibility to share the rewards with buyers.
“If they don’t, those buyers may take up offers from other agents on the same project – and pocket part of the commissions.”
It’s that competitive in the Dubai offplan property market right now. The sheer scale of new launches – and the buyer interest in them – has meant offplan accounts for 70-80 per cent of all residential sales in Dubai on a month-on-month basis.
“Developers are offering as high as 12 per cent for new launches, and even gold in some cases (to agents),” said Florine Rusu, Director at Market Price Real Estate.
“Since these properties are advertised, buyers are aware of the broker incentives. So, what happens is these are split between multiple brokers and the buyer, where the latter ends up even taking more than half of the incentives offered.”
On ready property sales, commissions are still stuck in 2-4 per cent range.
What should buyers do?
The trend of buyers and brokers sharing commissions is more in vogue in luxury property sales. Given the property ticket sizes, even if the commissions are in the 6-8 per cent, there are still plenty of rewards to share around is the thinking.
These days, buyers are quite upfront when it comes to asking a broker whether he or she is willing to split the commission. If they find one broker isn’t willing to do so, they can find another who might.
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“In luxury property, the commission structure tends to be higher,” said Imran Khan, Managing Director at Investment Experts. “When that happens, the buyer gets some percentage which is decided on a case-to-case basis.”
As for property buyers, they should not let go of the ongoing Dubai property market dynamics. If there is even the slightest chance they can get brokers to share, the buyers end up with a win-win.
So, all that potential buyers need to do is ask - these days, there is always a chance they will get that commission split.