Anyone who has previously read my blog posts knows that I have spoken numerous times about the importance of changing the way that we conduct residential leasing transactions. My main points have always been that we have enough population to satisfy the current and future supply but due to the large deposits and post-dated payments, tenants just simply do not have the funds to lease which leads them to share and lease rooms on a monthly basis.
A few months ago, I was introduced to Urban to join as an affiliate broker but I was so impressed with the company that I decided to join and be a part of the first-ever proptech company to take the leasing process online.
So why is Urban so important for the market?
Currently, if a tenant wants to lease a 1 bedroom in the Marina for an average price of AED 75,000 in 4 cheques (I hate cheques), they would need AED 18,750 upfront for the first rental payment, AED 3,750 for the security deposit, the same again for agency commissions and an additional AED 3000 for utility connections etc… a total of AED26,250, before removal costs, furniture purchases and so on. This equals to 7,200 USD. With an average salary of AED15,000 – AED20,000 a month, the chances of saving up this amount are extremely difficult, let alone a new expat coming to Dubai to work for the first time.
Back when companies used to pay for accommodation (which is where the upfront cheque payment plan came from), this was not an issue. But as the population has grown, the need for companies to provide accommodation in addition to a salary has gone.
I have experienced many tenants get into debt and/or missing payments due to the current payment plan in the market. That’s not the reason we’re in Dubai. We work to live not live to work.
In addition to the above, non-resident landlords find it hard to collect cheques as they are no longer able to open a UAE bank account and are forced to use property management companies who charge 10% on average. Along with service charges, maintenance and the drop in rent, Dubai’s always-impressive ROI has dropped from an average of 7-8% in the Marina to as low as 5% making Dubai a less attractive investment hub.
So what has Urban done to solve this matter?
Urban has put the entire leasing process online creating a better experience for tenants and landlords. Tenants can book 15-minute viewings themselves using the app, and see full inspection reports of properties including what landlords are prepared to replace, fix or change before move in. Tenants can also pay rent with their choice of payment plan: by card, bank transfer or payment installments.
The properties are all inspected, cleaned and professionally photographed prior to going live with virtual tours to ensure full transparency.
Landlords benefit from getting payment transfers directly to their banks (no more cheques), in addition to full inspection reports on move-in and move-out which will reduce the rental dispute cases at the Land Department. Any tenant that comes through our app after the deposit is paid will be screened through credit checks and salary certificates.
Today was the official launch for Urban online and we are currently offering the following for Landlords to list:
Currently, we have two options:
Cost: Free until May 2020
Includes: fitting of the lock, cleaning, photography, virtual tours, inspection reports, marketing, leasing, credit-checked tenants, Ejari, rental collections for the year (paid to you on the 15th or 28th of each month to any UAE or international bank account), negotiations and documents of the renewal of the lease.
Virtual tour example
Property Management – Full hands-off investment
Cost: 5% of the yearly rent taken once leased.
Includes: fitting of the lock, cleaning, photography, virtual tours, inspection reports, marketing, leasing, Ejari, rental collections for the year, renewals, full management of tenants issues which arise throughout the tenancy, arrangement of maintenance, when required.
Thank you for supporting me for the past through the years at Carlton Real Estate, I look forward to the future with Urban and shall continue my data reports as I go.
Please get in touch if you would like to find out more.