Last Updated on Thursday, 27 May, 2021 at 3:43 pm by Andre Camilleri
Derrick Maguire is CEO Luxfair Real Estate
According to the Dictionary the definition of a deal is, take part in commercial trading of a particular commodity. The definition of a sale is, the exchange of a commodity for money; the action of selling something.
So how do we decide the value of this transaction? In Real Estate in Malta it appears to be not an “exact science”. Many sellers have aspirations to the value of their property, maybe based on hope, maybe based on gossip with a neighbour. However, they have no way of making sure that valuation is a true one, apart from maybe a portal check to see if anything similar is for sale. However, this is fraught with issues as they will only see other inflated property prices which will give them false hope as to the value of their property.
So how do we get the actual market value? The most probable price that a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus?
Malta seems to have information on property in so many different places, surely there should be a central database with all the information accessible. Maybe something based on MBR, Malta Business Registry, methodology where detailed answers come at a price could be an idea.
Having access to hard/factual data of sales prices would be a huge positive for both sellers and buyers, as well as making the Real Estate agents job of dealing with a motivated buyer a lot easier and speeding the sales process up immeasurably.
The answer, I feel, starts with the notary. After all they are the constant in any sale/deal in regards to Real Estate in Malta.
The notaries have access to ntg.gov.mt Structure, Function and Responsibilities (gov.mt). This covers all things notarial but with regards to property appears to only show statistics, etc. You can apply through Freedom of Information, but that would be slow and laborious I guess, plus it is another fence to climb for information that should be freely available.
Government have set up the rent registration process, why not do the same with sold property? All that the notary has to do is register the sale in the same way a landlord registers a rental. If the technology is available then use it!
In summary there appears to be nowhere where we can check sold property prices for free or a cost. Something that shocks me considering we are in 2021 and not 1921!
Now we turn our attention to the mechanics of the sales process and look at the use of DocuSign or similar platforms.
My colleague Dima Nikitin, senior Sales executive at Luxfair Dhomes, has looked at the use of DocuSign to assist the sales process and his findings are detailed below.
DocuSign is a provider of cloud-based electronic signature technology that facilitates exchanges of contracts, tax documents and legal materials. DocuSign’s features include authentication services, user identity management and workflow automation.
This could be embraced at so many levels in the Real Estate world of Malta. The Real Estate agency has to do many checks so this will assist and speed processes up greatly.
But who pays for the service?
Dima’s view is that the service should be incentivised to be utilised by companies and individuals in the exact form of grants from the EU. Malta has for a long time received EU funding that has helped the island flourish and modernise in many aspects of day-to-day corporate and personal life. With Malta already securing funding under the 2014-2020 Partnership Agreement of Malta with European Structural and Investments Funds, covering European Regional Development Fund (ERDF), European Social Fund (ESF), Cohesion Fund (CF), European Agricultural Fund for Rural Development (EAFRD) and European Maritime and Fisheries Fund (EMFF) (https://eufunds.gov.mt/en/Information/Pages/Partnership-Agreement.aspx), it’s not an insane proposition that some funding can be secured for the integration and utilisation of DocuSign.
DocuSign complements Blockchain, something we will discuss in another article and can also smooth out the buying process. An example Luxfair had during Covid was a konvenju with 51 signatories. This had to be carried out over three days to allow social distancing. DocuSign would have done it in less than an hour. Some may argue that not everyone has access to the internet, luckily, we have statistics that can help us on this. According to The Global Economy, Malta had an internet access rate of 85.78% in 2019.
85.78% alone is enough to make the argument that internet access isn’t an obstacle to DocuSign. That being said, even if one was to make the argument that 85.78% is still not enough, I point to one simple solution – agencies/notaries/intermediary parties. A trained and specialised workforce that can handle all of the devils in the details with efficiency and professionalism.
But how can we argue with Dima’s views and well-made points here? This is a solution readily available to anyone who wants to use it. I personally have witnessed how good it is at saving paper, saving the planet, saving time, saving admin in an office I managed at Martin & Co. Aberdeen (Scotland), in 2013 they were totally paperless and fully managed over 1,000 rental properties.
Would it not be great to see Malta stepping forward to be the leader in cutting edge technology and setting up a whole new industry on the back of this digitalisation? I had the joy of working and living in Dubai for four years; this is a country that 36 years ago the Sheikh looked out from Deira and said I am going to build a new city in the sand and make it the number one in the world for technology. He dared to dream and out of it came Dubai. So why can Malta not dare to dream and move away from its over reliance on one big industry, Gaming?
Digitalisation brings versatility and strength in a world that has gradually grown to be digital – don’t we want to be at the forefront of it all instead of being left behind to bite the dust of those who acted quicker?