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Why luxury property sales grew 15 per cent during 2020

Just over a year ago when the world went into lockdown over COVID-19, billions were preparing for a dismal future – but it had quite the contrary effect on the property market.

Luxhabitat Sotheby’s International Realty CEO George Azar explains the global real estate boom was a silver lining to the unprecedented crisis.

"COVID was very good for the investment world, to be honest with you, especially on real estate," George shared at Sir Anthony Ritossa’s 14th Global Family Office Investment Summit in Dubai. "So as much as people thought it was going to have a negative effect, it actually had a very positive effect.

"Quarantine has been seen as a very attractive asset class for a lot of investors globally."

The property expert says Europe recorded villa sales five times higher than the previous year – a number that hasn’t been seen anywhere else in the world.

"The revenues of all the companies have gone up by at least four to five times in terms of real estate business," he says. "And this is not by coincidence. This is the quarantining."

In 2020 alone, Sotheby’s International Realty recorded more than US$150 billion in sales globally – compared to US$120 billion in 2019.

"Our figures increased by at least 15 per cent globally," he says. "That’s a very high number when the world is closed down."

The high-end property brokerage in the UAE caters to the top one per cent of ultra-high net-worth individuals – a crucial element to the business’s soaring success.

Just as the likes of Hermès, Louis Vuitton and Ferrari are synonymous with being the finest brands on Earth, Sotheby’s has secured its place in the top three names that come to mind for real estate.

"It shows the integrity, transparency and, most importantly, the trust they have in the brand," George explains. "The brand is 277 years old. It has its global status, and so our business model is based around these key factors.

"It’s been really successful for us over the last few years now."

Having sold almost the entire Four Seasons Residence on the canal in UAE in three months – with just three units remaining – is proof the business model of attracting high-end user buyers is invaluable.

"When you surround yourself with people better than you, that’s key [to success]." – George Azar

However, the real estate expert hasn’t always been immersed in luxury property. The CEO spent 21 years in banking – an experience he believes was a crucial skill set for his venture at Sotheby’s.

"My success [came down to] relationships, speaking my mind, going the extra mile and getting the trust of people. Because when you’re buying real estate, it’s like opening a bank account with people," George shares. "You’re not going to open a bank account with somebody over the internet, over WhatsApp chat. You need to meet them."

Despite the necessity of video calls during the pandemic, it’s the face-to-face approach that is critical in taking the luxury real estate business to extraordinary new heights.

"You need to have the confidence, the trust to buy, especially when you’re selling AED20 million [US$5.4 million] homes – and above," George says. "They need to know who the person is they’re buying from. They need to feel that this person is talking the right language, representing the property in the right way.

"This is who we are as people, and this is the way I’ve always been successful in my business as an individual."

While George and Managing Partner Chris Whitehead don’t do deals at the company, they enforce a tough and dedicated work ethic to harness the best results – and they lead by example.

"We’re hard on the team and the reason for this is because we want them to get better," he explains. "They know we have room for error but, at the same time, we’re very focused. We always try to improve, and I believe the team are driven by that because they see us. We’re always first in in the morning and we’re always last out. We have more heart in the business.

"I think when you surround yourself with people better than you, that’s key [to success]."

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