October News Letter 2017Posted on: 8th October 2017
Airbnb was founded just 11 years ago. Its business model is based upon allowing strangers into your home to stay, just like a hotel but not necessarily with room service. Acting as a broker between the guest and the host, Airbnb now boasts over 3,000,000 lodging listings in 65,000 cities across 191 countries.
Many potential early investors thought the idea was absurd, based as it is on high levels of trust and understanding among the three parties in the contract.
I have written many times about the importance of trust in the work that we do. My role as a broker between the developer and the purchaser is defined by two attributes – trust and understanding.
For example, why not go directly to a property developer, cutting out the middleman like me? It seems to make sense, right?
But think for a moment. When you need to buy a new refrigerator, no one ever thinks about going to the actual factory where they are constructed. And if you did manage to fly to Korea and visit one of the huge appliance makers there, they will only talk about their products, not their competitors.
By going to the retailer, you immediately gain access to choice – experienced and knowledgeable salespeople on the floor can show you some different options from a large range of different appliance manufacturers.
Your retailer is the one that will provide you with the personal pre- and after-sales service, acting as an intermediary between you and the manufacturer.
Real estate agents are the retailers of the property world. A good agent knows all about the products on offer because they have built professional relationships with all the major property developers, not just the three or four master developers out there.
So why would you circumvent the one person in the property buying process who is capable of being objective and able to provide unbiased advice?
Today, in some cases over 85% of new property sales from developers in Dubai are conducted through the services of a real estate agent.
I spend 3-4 hours each day working directly with Dubai-based property developers, and I know their strengths and weaknesses. Through weekly meetings, site and inspection visits to new developments, reviewing S&P agreements, and attending launches of newly-released projects, I live and breathe property every day.
There are three significant advantages to me working with developers. First, I receive early information on properties about to be released onto the market. Second, as I build those relationships and bring interested buyers, this flow of business ensures that the buyers receive the best available prices and the best service levels. And finally, plans and strategy are shared with me by developers to retain my interest and keep me returning with clients.
I know how they work. For example, some major property developers fire their staff within three months if they have not met their sales targets. Under these pressure-cooker working conditions, the staff turnover is very high, encouraging newly-arrived and unknowledgeable staff to say and promise almost anything to close a purchase and keep their job for another three months.
Try going back to a developer with a problem after the deal is signed and the first instalment is made or when you need to sell or rent your property: what is their motive for helping you?
My business is based upon long-term customer relationships with high levels of trust and understanding. Having lived and worked here for 13 years, I also have considerable knowledge about Dubai and the property landscape.
Like Airbnb, I understand the value of ensuring the buying and selling process is kept simple and efficient and comes with the promise of human connection, based as it is on trust and understanding.