There was a massive decrease in the number of real estate brokers in Kuwait last year.
Abdulaziz Al-Dughaishem, the head of the Kuwait Union of Real Estate Brokers, said that from 3,700, the number of real estate brokers in Kuwait went down to 700. These 700 individuals were approved by the Ministry of Commerce and Industry and the Anti-Money Laundering and Terrorism Financing Department.
This decrease was a result of the commitment of the unions to improving the real estate brokerage market. They have been working hard for the past two years in order to filter out real estate brokers in Kuwait who are not qualified to be part of the market.
Around 3,000 real estate brokers in Kuwait left the market. Some chose to do so, while others had no choice but to leave because of the stricter regulations that were newly introduced. The Ministry of Commerce and Industry and the Anti-Money Laundering and Terrorism Financing departments added requirements and conditions that made it difficult for some individuals to comply with.
A brokerage permit is now necessary for individuals to work as real estate brokers in Kuwait. Those who plan to apply for a permit are also required to get the relevant certificates.
More individuals who have graduated from university and pursued further studies choose to pursue a career in real estate brokerage. Because of the implemented regulations, there are no more opportunities for random work.
Abdulaziz Al-Dughaishem treats these changes as highly welcome steps in developing the real estate brokerage market. He stated that “the real estate brokerage offices have emerged after combining scientific and practical experiences, as they are managed by Kuwaiti youth armed with scientific certificates and modern technology tools”.
The years of experience that the current real estate brokers in Kuwait have will be complemented by the young individuals who have university degrees and have recently entered the market. This creates a suitable environment for the further progress of the real estate brokerage profession.
Real estate brokers in Kuwait will now have both the practical skills and theoretical knowledge to perform their responsibilities as best they can. This is a shift from the previous landscape of the market wherein real estate brokers only banked on their experience but did not have the official certification to do so.
Because of the new requirement involving certification, around 400 real estate professionals decided to take the courses offered by the Real Estate Brokers Union. Upon completion of the courses, individuals can be awarded with certificates so that they can continue the process of becoming a real estate broker.
Interested individuals will then be required to work as trainees after obtaining the certificates. They can work at any of the real estate brokerage offices accredited by the relevant institutions.
The period of working as a trainee will last for one month. This will give them the necessary exposure to the ins and outs of the industry so that they can learn first-hand about the basics of the profession.
How Can Individuals Work as Real Estate Brokers in Kuwait?
Resolution 164/2020 was implemented to regulate the real estate brokerage profession. This created certain conditions for individuals who were interested in becoming real estate brokers in Kuwait.
The criteria to become a licensed real estate broker are as follows:
- The individual must either be a citizen of Kuwait or one of the countries included in the Gulf Cooperation Council
- At least 21 years old by the time the individual submits the application
- Have full legal capacity by the time the individual registers on the real estate brokers registry
- Does not have any records of conviction of a felony or crime that goes against honor and trust. However, if unable to comply with this condition, the individual must have undergone rehabilitation
Apart from those mentioned above, applicants should also not be included in the real estate residents registry. They should complete the programs and tests administered by the Real Estate Department at the Ministry of Commerce and Industry. An office should be available to them for the purposes of practicing their profession. Lastly, individuals should abide by the code of ethics.
How Much Do Real Estate Brokers Earn?
Real estate brokers are entitled to 1% of the value of the contract. This is applicable to contracts that involve the sale of properties and contracts for the right of usufruct.
For contracts that involve leasing, real estate brokers will earn 50% of the monthly rent fee for one month.
In transactions that are handled by two or more brokers, the wages will be divided among the involved brokers. Each broker will receive the same amount of commission, unless stated otherwise.
With this, the average monthly salary of real estate brokers in Kuwait is 600 KWD to 1,670 KWD. Different factors, such as years of experience, highest educational attainment achieved, and gender, influence the salary of individuals.
Real estate brokers that have more years of experience earn more. Those that have less than 2 years of experience have a monthly salary of around 690 KWD. This is expected to increase over the years, with those who have more than 20 years of experience earning 1,600 KWD every month.
Similarly, obtaining a higher level of education is associated with higher pay. An individual who graduated from high school earns 840 KWD a month. In comparison, those with a master’s degree earn as much as 1,550 KWD every month.
Lastly, men earn more than women. The average monthly salary for men is 1,140 KWD. This is 8% higher than the 1,060 KWD monthly salary that women receive.
Responsibilities of Real Estate Brokers
Real estate brokers are required to submit information on any of their activities to the Real Estate Department at the Ministry of Commerce and Industry. This also includes a copy of the book, which should be submitted every year.
Professionals in this field are also required to hold their relationships with clients in high regard. Brokers should communicate pertinent information that can affect the clients’ decision-making processes as soon as possible. Any information obtained from the client should be kept confidential.
Although stringent, it is hoped that the new regulations will create more competent real estate brokers in Kuwait. Professionals in the sector will be challenged to continuously develop their skills and knowledge. At the same time, this can help safeguard future clients from unfavorable transactions.