Driving Success in Dubai's Real Estate Market with Expert Development Management Services
By Firas Al Msaddi on Monday, 08 July, 2024
The demand for both off-plan and ready properties in Dubai continues to break records. Off-plan sales volume in June 2024 is 43% higher than June 2023. Year-to-date, 59,000 units have been registered by real estate developers and are on the market for sale. Last year, 2023, saw 101,000 units registered, nearly double the number registered in 2022, which had 58,000 units. The supply of off-plan projects is set to reach an all-time high by the end of 2024, and it is anticipated that over 125,000 units will be registered by developers before the year ends.
While demand for new off-plan projects remains very strong, the abundant supply means buyers and investors are becoming more selective when choosing the right project and even the right unit within a project. The competition between real estate developers is intensifying, focusing on several key competitive metrics:
  1. Holistic Attractiveness of Offerings: This includes the value offered (developer's brand equity, historical records, lifestyle, location, living experience, finishing, quality, ticket price, and price per square foot) versus the investment made by buyers.
  2. Payment Plans: These are crucial, especially in the current environment of high borrowing costs.
  3. Total Ticket Price: With prices at an all-time high, the total ticket price per unit is becoming more significant than the price per square foot.
  4. Agents' Commissions: This plays an important role in directing agents' time and money towards promoting projects for developers.
While the market for off-plan properties remains robust, not all developers are equally successful. Developers offering unique new projects, such as the recent massive success of Verve City Walk, stand out. Verve City Walk sold 427 units in just 45 minutes, with the penthouse fetching a staggering AED 30 million. This achievement highlights the strong market demand and the credibility of prominent developers like Meraas, Dubai Holding, Nakheel, and Emaar.
In terms of sales and marketing, the bottom line competition among real estate developers is over brokers' attention. Regardless of their size, most developers' sales happen through real estate agents. The industry continues to be highly human-relevant, as real estate buyers and investors value personal connections. Developers invest significantly in keeping agents engaged through regular activities, roadshows, marketing budget support, prompt payment commissions, and attractive offerings to investors.
If one factor stands out in attracting agents to work with a developer, it is the attractiveness of the developer's offerings in terms of location, price, and payment plan. Smart agents understand that selling the right property to investors ensures profitability for the investor, leading to continued business and referrals. Therefore, while commissions are important, agents who prioritize higher commissions over the quality of the project often fail to build lasting relationships or receive future referrals.
Because we have extensive experience as real estate brokers and real estate developers' representatives, we know what product to produce on behalf of developers or advise developers to produce to attract every real estate agent and drive them to sell it for them. With this being said, knowing all the different moving parts and having the largest force of real estate agents in Dubai with the largest network of external real estate agents, we have 700 estate agents. If each agent has a network of 5 to 10 other agents, we have at least 6,000 real estate agents registered under our development management services arm. To this point, fäm Real Estate Development Management is set to launch new off-plan projects worth 12 billion dirhams before the end of this year.
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