Digital mortgage lender Better.com is exiting the real estate business.
The struggling fintech startup laid off its real estate team on June 7, multiple sources confirmed to TechCrunch. The company is said to be shifting from an in-house agent model to a partnership agent model.
One person who was impacted by the move told TechCrunch that the agents had received “little to no severance…after getting a more than 50% salary cut in November in order to ‘ensure’ our jobs to come.”
TechCrunch reached out to Better.com, which declined to comment on the record. It is not clear how many people were impacted.
The news is not shocking considering that rumors of Better.com’s plans to exit the real estate business have swirled for some time as the housing market has experienced a major slowdown driven by rising mortgage interest rates. As early as April of 2022, TechCrunch reported that it was suspected that all of Better Real Estate could be scrapped. The unit was at one time the “baby” of the company, sources said, and where a big chunk of investment dollars were going to go toward in 2022.
Better had been vocal about its desire to build out its purchase experience and move beyond digital lending to help people find and purchase homes — hence changing its name from Better Mortgage to just Better. It was also working to expand value-added offerings like title and homeowner’s insurance as part of its product suite.
“They wanted to touch every part of home ownership,” a source close to the company who preferred to remain anonymous told TechCrunch at the time. “The company invested resources in building out consumer experiences and agent-facing tools for the Better Real Estate business, including its first native mobile app, not all of which came to fruition, given the trajectory of the business.”
Better Real Estate aimed to be competitive with the likes of Zillow and Redfin, and the company had reportedly followed the same salaried-agent model.
Better.com has been making headlines for its layoffs since it first gained notoriety by laying off about 900 employees over Zoom on December 1, 2021. It has since been laying off smaller groups very systematically, say sources. Last August, TechCrunch also reported the fact that Better.com had conducted its fourth round of layoffs since the previous December.
In March, TechCrunch reported Better.com’s SPAC deal with Aurora Acquisition Corp. got a new lease on life, extending its timeframe to close the transaction through the end of Q3 2023.
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
