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Dubai property agents expose fraud tactics amid crackdown on fake ads, listings

Dubai's Land Department has laid down new rules for advertising real estate properties, with a fine of Dh50,000 for violations

Real estate agents across the emirate have welcomed new rules implemented by Dubai’s Land Department (DLD) and are hoping it will remove fake listings and fraudulent advertisements.

“These changes are very important for the real estate market,” said agent Craig Brown, Associate Director, the Luxury Collection. “There are a lot of unprofessional agents that throw up fake listings, sometimes even without the proper documentation. It is saturating the market and mitigating the chances of an agent who is abiding by the rules. This will make sure that the industry is clean and fair to everyone who follows the law.”

In February, the DLD and the Real Estate Regulatory Authority (RERA) sent out a circular laying down the conditions for advertising units.

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“A real estate project permit allows the broker to market the project as whole, not specific units, even if those units are within the same project,” read the circular, dated February 22. “It is necessary for all brokers to address real estate platforms to immediately remove these violating advertisements within a period not exceeding five days from the date of this circular.”

Any agent found violating this rule will have to pay a fine of Dh50,000 and his or her license will be suspended for three months. Repeated infractions will lead to a permanent cancellation of their license.

“What this means for the market is a cleaner and more transparent search for buyers and renters alike,” said Paul Kelly, Operations Director at Allsopp & Allsopp Group. “We should get to a stage when only readily available property is being advertised, and as soon as a property is sold or let it is removed from online advertising.”

Paul said this will also promote best practices within the real estate industry. “It means that the agencies with the best practices are promoted, which in turn leads to a better search experience for the home seeker.”

Fraudulent agent violations

According to Jeff Raju Kuruvilla, CEO of Manifest Real Estate, several fraudulent agents were playing the system using various means. “Some agents were using the developer NOC to even put ads on portals for secondary market,” he said. “In reality those units were already sold by the developer.”

Craig said there were other kind of violations too. “You will see that there is a number of off-plan secondary listings that agents are advertising as directly from an owner,” he said. “They falsely claim that they have direct access to landlords and sellers, just to generate some leads.”

Earlier in February, the DLD had issued a three-day notice to agents to remove fake listings. Real estate agents say firm steps have been taken to implement these rules. “All real estate ads, whether print or on social media, must include a QR code to enable investors to verify property information advertised,” said Jeff.

Craig also added that it was a welcome move. “If you look for property listings, you will find ads with the tag ‘Genuine Listing’ and that is a little disappointing,” he said. “We should not have to put that on an advertisement. There should not be a fake listing.”

Real change

For Shireen Mansoor of True Deal Properties, these are real changes which will make things easier for newbie agents like her. “I have just entered the market and I have heard from my colleagues who have been in the market for a long time about all the pain point in the industry,” she said. “I am truly grateful that I am coming into the industry at such a time with the DLD doing everything to make sure people do the right thing. I think following such a streamlined process is in the best interest of the emirate, which is continuing to attract attention from all over the world.”

Craig said that it will take a few months to see the real impact of these changes. “This is a real crackdown that should weed out fraudulent practices,” he said. “I think within two or three months, the fake listings should all come down. Also, the rules will have to be enforced stringently for people to take it seriously. So the next few months will be very important for the industry.”

According to Jeff, the visible impact of this is how listings have already changed. “If you look at listings now, they have been colour coded,” he said. “A red status shows they are in violation of compliance. Permits with yellow status contain one or more inaccurate details, while a green status indicates complete compliance.”

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