[Music] the problem in this regard is that I see a lot of I a lot of challenges when it comes to my name is Ahmed Elnaggar and this is Monday Legal good morning my guest for today is Majdel Musa director of operations and Legal in Real Trust good morning Majdel good morning thank you for having me finally we get to meet in person uh we inter interviewed Lyette before from the same uh company and operation but it was very important for me because to to invite you to speak to you because you've been instrumental in working with the vient department for uh a long I mean for for some time during a very transformative um time with the uh document and with the regulations that related to the re estate transactions in the UAE practicing between the US and and here and you you've mentioned that you did brokerage and legal work in the US and I think now here as well you did since 2014 until now we did legal work for reate and I think you're getting as as well into brokerage or into at least the the the operations with convincing with rust how do what similarity and what differences do you see between the two markets because of course us is is quite a different uh from the Practical perspective there's a lot more collaboration in the US so the Brokers here are very hesitant to collaborate with other Brokers where in the US it was very normal right and people would now of course we have this n judgment that happened so they can't share the commission anymore but it used to be that the seller would pay the commission and the listing broker and the buyer broker would share the commission so it was very normal to have Brokers from different brokerages working together and everything was listed on the MLS which is open to all of the the Brokers yeah so here they're very secretive about it because even within a brokerage they're scared that their colleagues are going to steal their clients so they won't even give the listing details what property it is ETC because they think they'll go into the database and find out who the owner is and go behind their back and steal the client which practically happens it does it really does unfortunately so that's one big thing is is the collaborative Spirit basically it's uh much stronger in the the us but I guess here in duband Department there is also another form other than form F which is broker broker uh for for my yeah and and and this form should kind of regulate the relationship between the broker to avoid such conflicts so if I don't know if you've ever seen formi but it's very very basic never seen it and it's it's more so actually they asked me to also work on form I form a Form B but unfortunately that part of it didn't make it into the forms um so form I as it currently stands is basically just saying that it's basically when the the buyer broker wants to take their client to another broker's listing and it just says basically if the sellers broker doesn't respond within 24 hours that they can complain to rira that's a that's basically it it's not really even about negotiating the form f it should be at a stage where they're negotiating form F and if there's a commission split for example on the rare occasion where they do want to split commissions yeah you know that okay we we agreed to split the commission Etc but it's mentioned in form F if there is a split of the commission who's going to pay the it says who's going to pay what fee to who but it doesn't talk about between the Brokers yes yes of course and both Brokers and the form I must be registered with a rer card they cannot be a third party of course is it the same in the US so yeah you cannot not be licensed in the US and they're are very very very strict you know the penalties for that right so people take that very seriously they don't practice real estate without the broker license I I'll I'll go more into practicality than just legal because the market I mean the laws in general and the regulations have to catch up with what's happening in the in the real world not the other way around so what's happening here is that everybody is working in the re estate when the market is up whether you regulate it or not even re estate brokerage they hire people before they take the course they're already in the market they're already talking to people they're already making the calls and they're running around saying I'm the broker but when the form F come we find another name EX for a different broker how do you see this um let's say is there a way to help reduce this kind of practices to be honest I think exclusivity is the answer for a lot of our problems in this market and I know a lot of people say that and a lot of people say no absolutely not we don't want exclusivity um I think it will weed out a lot of the the Freelancers and also a lot of these either bad Brokers or the ones who are just maybe doing it as a side gig kind of thing they're not really taking it serious I think as much regulated brokers in the market they're an equal number to them who are doing it as a sidekick oh there probably even more because they we just crossed 20,000 a month or two ago of registered Brokers and now they're estimating maybe they're 30 40,000 of unregistered obviously we can't get official numbers but uh yeah but one of the significant things as well is that I've seen personally a lot of contracts directly signed between the developers and the non-regulated Brokers yes and as we know the offline laws strictly say that developers cannot work with unregistered Brokers so until yesterday I've seen contracts being signed by re estate developers prominent big names in the market local and international signing with non-regulated re estate brokers yes and it's a big deal it does happen it does happen and now there's a lot of crossover into the other Emirates as well right and every Emirate has their own licensing for brokerages and Brokers so you know a lot of people like now R is the the big place to go course all these Dubai Brokers are going there AB duby a lot of them are going there to sell a projects and things like that so they theoretically they're not allowed so if your broker registered with Dubai land Department would have a radar card as a broker are you allowed to sell Abu Dhabi Properties or rasak properties you're not no there's a separate license course in fact I actually teach the licensing course for abub for think prop as well as is Tove and it's it's separate licensing so tell me a little bit about Abu dhabi's regulations in terms of fre State brokerage and how the how the market is is is supposed to be run there yeah so they also require licensing and they actually still have to do the course so unlike Dubai when they closed the Real Estate Institute in 2020 they actually said okay course is not mandatory anymore you can take it if you want to but you have obviously still have to pass the exam when abble duby they actually have to take it not only the first time when they're taking the exam and getting the license but every year when they go to renew they've got to take the course again so it's a little bit stricter in terms of the licensing um but yes it's it's in terms of the code of ethics and things like that they're actually pretty on par with Dubai okay uh so and they are they now have an Abu Dhabi real estate Center adric so it's not it's an offshoot of the municipal because municipality used to handle everything yeah and now they're handling everything related to real estate so that just basically was established in November of 2023 and their offices I mean you go to them now you can still smell the fresh paint so it's very brand new so they're taking over everything yeah I remember the few years ago I think was was even during covid time we were selling some properties in and some of the islands in Abu Dhabi and we had to go to the Dubai M sorry Abu Dhabi municipality and they had the planning department they were issuing the title Deeds at that time and there was a lot of problems because a year before that 2019 AB have changed the um the fee from 1,000 dam for property transactions into two% of the deal and there's so many people uh taking advantage of that convincing their clients that is not two it is even going to be four charging even extra at the time that was only 1,000 dham for recate transactions um how um how strict and how regulated is Abu Dhabi CC you saying this is just recently established have you seen a lot of transactions happening there have you seen a lot of brokerage firms opening branches and um uh educating their staff to building brokerage offices in Abu Dhabi because Abu Dhabi also the market is booming there yeah so there are I mean there were already a lot of companies in Al itself that focus on Alby but a lot of the Dubai the bigger brokerages are opening offices there if they don't already have them and actually the as far as regulation again because adri is so new they are just starting to really regulate in terms of penalties for example against the broker so they announced a couple of months ago that they penalized the Brokers for cold call in for example and so they're really starting to pick up and and catch up in terms of uh penalizing the Brokers and getting them a little bit more under control I'm going to take you up on that comment because really cold calling is one of the biggest issues here yes we are receiving a tremendous amount of calls everybody I know whoever inquired about a property not necessarily they own one but those who own property those who are registered even as power of attorneys who are dealing in in property transactions are getting ridiculous amount of phone calls TR have put some regulations R put some regulations but the problem is not Sol solved well what's happening right now is actually even myself in the last couple of weeks I've now gotten a bunch of whatsapps from either Pakistan or India or outside of the UAE and they're talking to me about projects and companies and things like that so now they're Outsourcing it basically thinking that okay we could still do it just not within the UAE so it's still ah they're getting smart about the violations so they let's go out of the country and violate from there exactly exactly oh okay yes yeah that's what's happening I just I I just wonder because I I honestly I'm not a re estate transactions expert like I I never did Brokerage in my life and I don't know how how that how does that work um I just cannot imagine that it works cold calls are one of the most annoying things that any investor could get but does it really work yeah the the amazing thing is you would think that right you like I don't want to be annoyed by you but actually they say that the average if you make a 100 calls you might get two listings out of it so for them that's a win it's a high return on investment for them so they still think it's something that they should be doing and some brokerages are actually forcing their Brokers to make calls here the databases go and make the call aside from the regulatory work that you have done dealt with have you been interacting with the public like for example the time that you have worked with the band Department um were there any problems pre form F that fall onto your desk because of the old u m us that any interaction with the public that ever came and and or any example of of problematic situations that happened before implementing the digital signing of uh a standard sale and purchase agreement for reate transaction well I didn't really so they didn't come to me I wasn't the the legal council the legal department of the the land department so they wouldn't come to me for those types of things things but there were a lot so talking to to the legal councils in the land department they did say that before form F there were a lot more complaints they would have people come in a lot more often to talk to them about the Theus and that they weren't fair and that these terms weren't correct and this is wasn't what they had agreed to Etc so they knew that they had to put something standard in place one of the big problems that I see with even forf that is existing right now is that the terms of it when it comes to a mortgage buyer or a cash buyer is not very clear and very often we've I've get contacted by inv investors who are selling their properties and saying we've been promised by the broker or by the firm or by the the the the the the buyer himself that he's a cash buyer and the money is there and then I realized that I signed a form of course without asking a lawyer uh that says that they will wait 30 days and they might wait another 30 days and this contract is subject to a mortgage approval and uh so their property is kind of locked exactly with a price for 60 days and the market is hot and they're receiving uh offers and offers um take that they can't take um do you see that further enhancement of further development of form f is necessary yes but actually they just changed that in the last week or so so they're now allowing you to put in it's not a standard 30 days extension anymore they're allowing you to put any number you want in it so they are making improvements to it what what exactly made you decide to leave the government sector and move into the private sector and specifically into conveyancing so it was actually I mean I had such a fun time at that job to be honest I said this is the perfect role for me because when I was little I wanted to be a teacher so I was doing the trainings and then of course using my legal background and then also real estate because I also have a real estate background so it was like the perfect mix for me but also I knew there was no real path for me there so everybody had their own career path so when they opened up their profiles as employee and then I opened up mine and it was just blank and I went to talk to HR like what's happening here and you know it is what it is like I said listen there's not much further that you can go here so I said okay probably need to look into the private sector but I still came back as a consultant to teach the courses after that so I was still connected to them yes I would like to argue with you why do we need conveyancing because that's what you do today I honestly in in many deals I that I do personally for myself I I feel like guys I know everything I really know everything and I have my Administration team in my office I can prepare the documents that I need I know the rules I'm going to just apply them I don't want to pay for convincing so please argue with me why is convincing so necessary so you need a neutral third party to take a look at everything and make sure all of the steps are completed right so taking a look at form F whatever was already there and perhaps if needed then creating an addendum for it and then also to do the ownership verification and making sure there are no blocks on the property and that's one thing that a lot of people don't know about yeah and it's super easy to do on the Dubai rest app yeah so you go on to the Dubai rest app which is the official app of the land department and you can go to property status you put in the details of the title deed so you do need the title deed and it will show you if there's a block from Land Department if there's a block from the rental dispute center which might mean a case but it might it's probably actually about unpaid service charges because rental dispute center now has that jurisdiction yes and then you can also see if there's a Dubay courts block which I'll tell you a story so I I always get approached by actually people on social media asking me mostly landlord tenant questions but once in a while it's about a sale or a purchase and so this guy asked me on LinkedIn can I call you I said sure and so he called and he said look I was purchasing a property and I signed the final offer letter for the mortgage on it I even paid the unpaid service charges of the seller because he didn't have money paid 21,000 Dirhams for him very Comon and I was about to go to transfer and the registration truste says we can't transfer there's a debate courts block now what had there been somebody to look right at whether or not there's a block this might have been prevented before he signed a final offer letter for the mortgage before he paid off the seller service charges right so now he's saying I'm going to bring a lawsuit but as we both know it's a very long process and very expensive so that could have been avoided but does it really show what is the reason of the block on the dubs app or it just shows what is the block and then we have to go and inquire from the seller for example yeah so you would have it would show you for example so it'll say Dubai is if if there's a block it says Dubai land department now I'm going to assume and it says talk to the authorities you have to approach the authorities to ask so I assume with Dubai land Department it's for for example golden Visa because they block the property right and then you have to unblock it to sell it right again rental it says rental dispute center but it won't tell you what so it's either a case or service charge service charges yes and then dubet courts it will give you the actual case number right so you have that much but of course it doesn't talk about the case or the parties to the case Etc but you do know that there's something there so you do have to talk to the seller then to get further information so that is one of the parts that conveyancing do and it's actually a very significant uh part of the due diligence on the transaction itself um again I'm a lawyer I know how to do it or I've been watching Monday legal the amazing podcast that teach you everything and I learned about this and I I am able to go to The Bu rest app and find out about this uh myself and I checked it my property is okay and then my re estate brokerage firm is forcing me to go through their conveyancing partner what else or what is other services that makes my life easy that the conveyancing do and I might have been like overlooking that yeah so pretty much every step of the process so if there are mortgages involved so for example if there's an existing mortgage on the property then we li with the sellers Bank to make sure that that gets released if the buyer is getting a mortgage then we we we Le with their Bank to make sure that they get the final offer letter so there's that aspect of it the no's now of course there's they're saying that no's are not required anymore you can get an enoc and it's only if it's off plan or the service charges have not been approved by R yet but what we're actually seeing is that we're still being asked for them whether it's uh registration trustees are a little bit better about it now but uh even the banks with mortgages they will refuse they say we will not issue a final offer letter unless we get an nooc so they're going to have to be because they did not yet update their checklist correct correct that's all so yes so it's not in the regulation to by Department do not require it but the stakeholders in the industry are not updated or just did not change their phones ex exactly so they're still asking for it and they're still saying we're not going to release the fol until we get it so yeah it's a it's actually it's a it's a Pity that sometimes the timely nature of the transaction will force you to do things that you know is not necessary or you know it's not applicable anymore or you don't need it but just because the bank they haven't caught up the lender is not updated but the the banks to be honest anyway are are they're holding back the real estate industry yeah because they're they're very behind and they're very slow to I mean we could digitize this whole process the transfer process but I think if that happens it's going to have to be done in phases with the mortgage transactions being less because it's just going to take them quite some time to to come up to speed to be very honest the amount of people involved if if we're talking about mortgage uh transaction so buying a reate through a mortgage amount of people in the middle is so much and the process is so long and it is really strange because everything is a set template it's very painful the the the the credit uh rating is a template and it's clear and it's accessible the mortgage uh calculations you can do online and is digital and it's easy the credit score is a very significant um tool and it shows the indication very quickly even comparison of mortgage rates between Banks there are tools that do this immediately on a real time and it's very why does it take one month for a re estate uh mortgage to be approved ex exactly and why the four or five people or stakeholders in the industry are involved just to get one approval from uh a bank to to take is there any any adjustment or any development that you see in this field that can uh enhance it you want to you want to see more digitization into the mortgage approval sure I mean in general the banks can be become much more digitized yeah in the UAE they they really need to work on it that's that's the most I could say is that that processes like you said and it's not just for mortgages for anything even opening a bank account as a company for example right it's just it takes a long time there are a lot of approvals that are needed and documentation and things like that what could what what what advice you give to anybody who want to start a career in real estate what should they learn where they should they go how to start they definitely should be taking the courses even if it's not required at the moment take the course learn as much as you can yes it's only 3 4 days but at least you're getting something find a that also will give you in-house training it's not just those few days and then that's it and you're left on your own and you know just uh swim with the sharks and see what happens see how it works yeah so do that and then take this it's not a job it's a profession and what you're doing is actually affecting people's lives whether they're doing it as an investment or whether they're going to live in that property this is a big decision for them and it it's a lot of money for them and so take pride in what you're doing and become as professional as you can and then go out into the world and help people thank you so much for coming thank you thank you very much for all the advises and the valuable information you're giving us thank you thank you for having me thanks and this is your do from Monday legal see you next week