Realtors returned them to supply and demand and considered them “rejected exaggerations.”
Tenants: Brokers who charge high fees for renting apartments
It is customary in the market that the rental commission does not exceed 5%.
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Residential unit tenants reported that real estate brokers impose exaggerated fees when renting new housing units, some of which amount to more than 10 and 12%, compared to the usual rates of 5%.
They pointed out to "Emirates Today" that high commission fees have recently increased remarkably, some of which exceeded by large percentages the value of the monthly rent for residential units.
In turn, officials of real estate companies stated that the brokers’ exaggerations are due to the conditions of supply and demand in the markets, while the representative committee of the real estate sector in the Sharjah Chamber of Commerce and Industry clarified that it is customary that rental commissions do not exceed 5%, despite the absence of a legal determination of that percentage left to the markets and the agreement of the two parties , calling for the necessity of raising the awareness of tenants and rejecting any exaggerated commissions, with the existence of multiple alternatives in the markets.
new unit
In detail, the tenant, Ibrahim Ali, said that he was “surprised when he moved to a new housing unit in the Al Taawun area in Sharjah, that the real estate broker, who was announcing the existence of that unit, was asking him to pay an amount of 2500 dirhams as a commission for the rental, which exceeds 10% of the total rental value. For the apartment, whose annual rent is 24 thousand dirhams.
The tenant, Ahmed Samir, indicated that "the real estate broker, who resorted to him to complete the rental of a new housing unit in the Al-Khan area, imposed on him an amount of 2,000 dirhams in return for renting an apartment for 20,000 dirhams."
The tenant, Amin Mahmoud, added that he "noted through his search for a new apartment that high commission fees have increased during the recent period from brokers, and some of them are demanding rates of up to 12% instead of 5%."
The tenant, Sanaa Khamis, explained that "one of the real estate brokers insisted on taking a real estate commission of approximately 10% of the rent value, and when the rental process was not completed, he refused to return half of the amount he obtained before completing the rental process."
Additional earnings
Walid Al-Zarouni, the real estate expert, Chairman of the Board of Directors of the “W Capital” real estate brokerage company, said that “some brokers are already exaggerating the request for commission fees in an attempt to obtain additional profits,” noting that “common and well-known commission rates in residential rentals are 5%.” Of the total value of the annual rental price, and any increases over those percentages, are unjustified exaggerations for brokers.
He added that «real estate brokers who exaggerate commission fees for rents lose, in the long run, dealers who resort to companies that get lower rates, with these brokers gaining a bad reputation, which pushes dealers to stop dealing with them, and therefore tenants must be smart in their Choosing mediators, and rejecting any exaggerations they detect in dealings.
Supply and demand
In turn, the Executive Director of “Al Som Real Estate”, Sufian Al-Salamat, considered that “the exaggerations of some real estate brokers in rental commission fees are due to the conditions of supply and demand in the markets and the process of agreement between the two parties. The demand in the rental markets, taking advantage of the incentive offers for rents, which force some tenants to accept these fees, despite their high rates, in order to take advantage of low rent offers or offered with privileges and facilities or what is called (value-added offers), which include free months or facilities such as free parking , and others.”
He explained that "it is important for the tenants to have the necessary awareness to negotiate or reject the imposed and exaggerated rates from intermediaries."
For his part, the head of the representative committee of the real estate sector in the Sharjah Chamber of Commerce and Industry, Saeed Ghanem Al-Suwaidi, confirmed that “the law did not specify the commission for residential rents, but (custom) in the markets set it at about 5% of the total annual value of the rent, which is a sufficient and satisfactory percentage for brokers, Therefore, there is no need for any exaggerations, and tenants must have sufficient awareness to reject any individual practices to demand high and exaggerated rates of rental commissions, especially since the markets are competitive, and there are many alternatives, whether for residential units or operating brokerage companies.
Consensus between tenants and brokers
The real estate broker, Magdy Abdelaziz, confirmed that “residential rental commissions are made in accordance with the agreement and consent between the tenants and brokers,” noting that “market conditions generally determine commission rates. The broker provides it for a commission.
And the mediator, Abu Bakr Ahmed, considered that “rental commissions are made according to the efforts made by the mediators so that the tenant can obtain the appropriate apartment, and the tenants can know the commission in advance.”
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