It is something we take for granted, something we don’t even need to consider when buying, selling or even renting a house. It is something that fundamentally underpins democracy, freedom and, ultimately, a capitalist society that must focus on inward investment.
As some of you know, I am lucky enough to travel to very interesting places and speak at various events, always talking about PropTech.
Every country I travel to has a property market which operates slightly differently to the last and the next. Generally, this means that my speeches have to be tailored for each specific market. Perhaps I cut out the swearing, or, in the case of Dubai, decide that the quote I often use to start off my presentations this Autumn, needs to be removed. The idea that PropTech is like teenage sex probably won’t be well received out here. Removal was the best policy...
Much like that analogy was better removed, it seems that, here in Dubai, some other topics which have already been removed by conference organisers are just starting to be discussed in open forum. Transparency is a prime example of this and, although it seems silly, it is definitely the elephant in the room over here.
Transparency is the cornerstone of our democracy. It underpins our business. It underpins how real estate is traded. Why? Because you know who is living next to you. You know how much your neighbours house sold for. You know what is in the title deeds. You know what is or is not going to be built right in front of your view. You (should) know everything about the property purchase you are about to undertake.
Here in Dubai, this isn’t all upheld. It is a market that has been built on many things, hype being one of them. I remember being here in the early 2000s selling property to UAE nationals getting out because the building boom was just starting and they hated the dust and the noise. That building is still ongoing now, nearly 15 years later and the population is only three million.
The big challenge is that to the outside world, the market here is ok. However, talk to the professionals and learn that this is the third year of declining sales and the third year of price reductions.
The other challenge is that you have no idea of the vacancy rate here. You have no transparency for how many units are really being sold, how many are empty, how many are rented, how they were purchased, nor who purchased them.
This information is all centrally controlled by government agencies and not generally released.
How can you genuinely trust an industry without knowing all the facts about it?
Perhaps this is why the UAE is only ranked 40th in global real estate transparency while the UK sits at No.1, and US at No.3 (with Australia between them in No.2).
Talking of central control, however, what is impressive here is their attitude surrounding innovation.
There is the Museum of the Future currently being built which is simply incredible when you consider the feat of engineering - when you look at the photo you soon wish you owned a scaffolding company…(is this not a traditional way of building for such a hi-tech building?).
Then, near this museum is the government innovation hub, stored in the Jumeirah Emirates Tower. It is beyond impressive (check out some of the pictures here). There are Youth Hubs, Government accelerators, and Future Innovation Accelerators. Everything is aligned to put innovation at the forefront of change.
They are doing what I see from other emerging cities and economies where the government is acting like a start-up. They are the ones driving change and putting it high up on the agenda. They are the ones who are making others conform with a top-down approach to ensure that management evolves with the times. This is something we in the UK can only dream of doing right now.
However. However. However. I can’t help but be suspicious of this.
Much of what I have heard in terms of change regards transparency. It is desperately needed in Dubai. To this end, the government needs to be more willing to help implement positive change. Its processes need to be more inclusive of public and private collaboration, not just government-backed companies and initiatives that are in total control of all the elements of change and progression.
With this in consideration, having a ‘Government Centre of Innovation’ certainly carries an underlying sense of passive aggressive control when leading the push for innovation.
The water, energy, and land departments are all part of this government centre scheme, the very departments that are being accused of being opaque. This all seems a bit muddled.
If Dubai, along with the rest of this sub-continent, wants to claim a crown for being one of the most innovative places around the globe, it needs to be far more open and transparent, far more collaborative, and far more honest about what is really going on.
It will be painful initially, I suspect, but will create far more trust and ultimately enable the region to genuinely become a driving force in property innovation and a truly groundbreaking market in its own right.
*James Dearsley is a leading PropTech influencer and commentator. You can follow him on Twitter here.