Developers are seeking approval for two 50-storey towers in the same block where Surrey city council recently gave the greenlight for what will be its tallest building at 67 storeys.
Blockchain application has now reached a pinnacle point, as industries, including the likes of banking, financial services, governance, insurance, media, and supply chain management, among others, now realize the capabilities blockchain holds.
The now widespread adoption of blockchain applications in some of the world’s most lucrative industries comes as no ordinary occurrence.
The inception of blockchain mostly took off in late 2008 or early 2009 after it was created by a person – or group – using the pseudonym Satoshi Nakamoto. Although this may be the case, the blockchain we know today came a long time before Nakamoto and Bitcoin.
In 1982, David Chaum, a then-doctoral candidate at the University of California at Berkeley, outlined what came to be known as a blockchain database in his dissertation “Computer Systems Established, Maintained, and Trusted by Mutually Suspicious Groups.”
Whether you support team Nakamoto or team Chaum, the use and application of blockchain technology has found itself in a profound position within the last few years, seeing mass adoption among businesses and, more recently, consumers.
Yet, while blockchain can now be found in everything from retail, telecommunications, mining, and manufacturing, the next phase of its development within the greater global economy has been its introduction into the real estate and property management industry.
Blockchain in real estate
For several decades, real estate and property management have been operating on a tediously outdated system that required an endless list of intermediaries, costing buyers, sellers, and investors a pretty penny to finalize their transactions.
In a recently published MSCI Report, the professionally managed global real estate investment market was estimated at more than $11.4 trillion in 2021, up from the reported $10.5 trillion in 2020.
You’d think an industry of this size, which constitutes a sizable portion of the global economic asset and transaction activity, would have seen a faster transition toward blockchain technology.
Though the adoption thereof has been marginally slow, recent developments have revealed some promising and practical solutions that could help revolutionize how the real estate industry can offer buyers, sellers, and stakeholders better accessibility and transparency.
Increased transaction security
Real estate transactions are known to be painstakingly slow, requiring deep pockets and a slew of resources to help finalize the deal. Blockchain-based property platforms can help to simplify the entire process, from searching for a property to eliminating any fraudulent activities that may jeopardize the transaction.
With blockchain, real estate companies and investment firms can seamlessly scan documents for any inaccuracies within an application. Historical data can be traced and used upon current application to help determine whether any information has been falsified or inaccurately presented.
It’s estimated that in the second half of 2021, around 1 out of 120 mortgage applications contained fraud. Allowing for data and transaction details to be stored on a digital ledger, real estate agencies, and stakeholders will be able to remove the risk factor, creating safer, easier, and more affordable methods.
The use of smart contracts
As part of creating a safe and transparent environment for all stakeholders throughout the transaction process, blockchain enables realtors, buyers, and sellers to utilize smart contracts to help speed up the selling or buying process.
Having smart contacts eliminates intermediaries, helping to save both time and money. With smart contracts, blockchain technology will be able to automate real estate transactions, title searches, and escrow services. Additionally, buyers and investors will be able to review historical data related to the property, such as previous owners, tenants, and the physical changes that have been made on the property.
Companies that manage rental properties will also be able to back-check tenant information such as financial statements, work history, and previous lease contracts to ensure applicants comply with outlined requirements.
Smart contracts are a simplified way to keep important information in one secure digital ledger, only allowing stakeholders access to the data and making it easier for involved parties to finalize real estate transactions.
Tokenizing property and real estate
A key element of blockchain technology is the digitization of securities, in this case often referred to as tokenization. With this, certain real-world assets and securities can be tokenized into a digital format, which can then be distributed to investors and transferred to certain counterparties.
Allowing for the tokenization of property and real estate, the industry is not only allowing it to become more democratized and accessible to a larger pool of interested buyers but also making digital assets more customized to meet investor and stakeholder needs.
Having real estate become tokenized makes it easier to spread the assets across several pools of investors while at the same time tapping into secondary market opportunities. What this means is that issuance can be completed faster, helping to speed up the exchange process and administering financial components such as payouts or dividends to involved stakeholders.
Increases real estate liquidity
The current market turbulence, which is mostly fueled by inflationary listing prices and soaring interest rates, means that there are not always buyers or sellers available in the market.
Though many people tend to sell liquidity to the bank in times of economic uncertainty, the use of blockchain could mean that individuals could sell off a percentage of their home’s equity in the form of tokens. We’ve previously discussed the tokenization of real estate, and in this case, it provides an alternative investment opportunity between a pool of investors.
Already we see how blockchain is making real-world real estate more digital and tokenized due to the introduction of Web 3.0 capabilities. Recently, a home in Columbia, South Carolina, was sold for $175,000 to a real estate investor via a non-fungible token (NFT) through a subsidiary Roofstock Chain.
The sale marked the first NFT-based residential home sale in the U.S., which required several layers of blockchain players to reach completion.
This is a simple example of how real estate, whether it’s commercial or residential, can be digitized and more streamlined to help increase its equity value and attract a larger pool of investors.
Blockchain technology proves to be a diverse, versatile, and multi-layered addition to the real estate industry that could potentially improve the security, transparency, and accessibility of real estate to a larger pool of investors, buyers, and sellers.
Although there is still a lot of development required for more practical and logical integration within the greater real estate industry, it’s already proven to become a successful addition to a global industry that sees trillions of dollars in annual asset transactions being moved across the world.
On a smaller scale, realtors and real estate companies could implement alternative practices that help to provide more steadfast solutions. This would not only improve the transaction process but allow for a safer and streamlined industry, making real estate a democratized asset on a global scale.
Featured Image Credit: Photo by Karolina Grabowska; Pexels; Thank you!
Real estate agents are turning to ChatGPT AI to describe listings – USA TODAY
Century 21 Beggins Enterprises on its website lists a “beautiful” three-bedroom condo in Madeira Beach, Florida with “large spacious balconies to enjoy the warm, beautiful views.”
“This is one of the only properties available on the Gulf Beach islands that’s totally pet friendly,” the listing reads. “Secure your piece of paradise at The Residences at Madeira Beach Town Center. Welcome home.”
If you’re tempted to buy the listing, thank ChatGPT. The text above was written by the free artificial intelligence computer program.
Real estate agents across the country are turning to the program to help write up listing descriptions and content scripts, as first reported by CNN.
“We’re using it every day,” said Mike Puma, chief marketing officer at Century 21 Beggins, who uses ChatGPT to write content like social media posts or video scripts for real estate agents. “(This allows) them to spend more time on what they do best.”
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How are real estate agents using ChatGPT?
Tony Angelos, a Chicago-based broker, said he started using ChatGPT soon after OpenAI launched the program in November 2022.
“It’s a total game changer,” he said. For most real estate agents, “marketing and prospecting is really most of the jobs’ core functions. And this is a very cost-effective way to completely eliminate one of those things.”
Angelos uses the program regularly to come up with scripts for social media videos and listing descriptions.
Earlier this week, he had the AI program write a script about things to do in Chicago in February. He said what would have taken him 20 minutes to write took ChatGPT five seconds.
“I said make it a little funnier, and it made it funnier for me,” he said. “It’s not perfect by any means. But it is an amazing starting point.”
Paige Hewitt, a realtor based in Indianapolis, has used ChatGPT to help write listing descriptions and marketing newsletters. She said the program’s capabilities far exceeded her expectations, and she’s excited that the time it saves her means she can spend more time with clients.
“It’s going to make my job easier, which is going to make me stronger at my job,” she said.
While the technology is a growing trend in the industry, the National Association of Realtors’ director of emerging technology, David Conroy, says business usage among realtors has so far been limited.
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How much does ChatGPT cost?
While ChatGPT is free for now, OpenAI’s official Discord server in January said the company was “starting to think about how to monetize ChatGPT” to “continue improving and maintaining the service.”
Real estate agents told USA TODAY they believe the tool would be well worth the money.
“We’ve been playing around with different AI platforms for years now and none of them have been very good,” Puma said. With ChatGPT, “we can now build really unique things on top of this that make the agents’ life even easier.”
Schools nationwide are banning ChatGPT: What we know about the future of AI in education.
What are ChatGPT’s limits?
ChatGPT has proven to be useful, but it’s not perfect.
Its popularity means it regularly reaches full capacity, forcing users to wait their turn to use the program. And because it was trained with writing from the internet up to 2021, some of its information is outdated.
Conroy from NAR warned that anything generated with AI should be thoroughly reviewed by licensed professionals. That includes listing descriptions; he notes that NAR’s code of ethics prohibits the exaggeration or misrepresentation of pertinent facts.
“There could be scenarios where listing descriptions created by using AI could unintentionally include language or descriptions that are not intended or even violate fair housing laws,” Conroy said in an emailed statement. “It is important to remember that real estate professionals have a responsibility to their clients to be honest and truthful.”
You can follow USA TODAY reporter Bailey Schulz on Twitter @bailey_schulz and subscribe to our free Daily Money newsletter here for personal finance tips and business news every Monday through Friday.
In Toronto real estate, a small bounce amid uncertainty – The Globe and Mail
Canada’s housing market will slowly grind lower in 2023 before finding a bottom later this year, predicts Randall Bartlett, senior director of Canadian Economics at Desjardins Group.
“We think the worst is behind us,” he says of the correction in real estate so far.
Still, buyers are likely to remain cautious as some price discovery takes place, Mr. Bartlett added in an interview.
“Nobody wants to catch a falling knife.”
By the end of December, the national average house price had dropped 20 per cent from its early 2022 peak, and Mr. Bartlett figures it will slip up to five per cent from that level.
Debt-burdened homeowners – particularly those with variable rate mortgages – are likely to find the first quarter the most challenging, says the economist, following the eighth interest rate hike by the Bank of Canada as it strives to bring down inflation.
The central bank also signalled its intention to pause at the latest meeting after moving the policy rate from 0.25 per cent in early 2022 to 4.5 per cent.
Mr. Bartlett is not expecting a wave of distressed homeowners to sell their properties this year, but they will likely rein in spending, he says.
That decrease in consumption will likely contribute to a short and shallow economic recession, according to Mr. Bartlett.
He cautions, though, that the risks to his forecast are tilted to the downside, partly because of the prevalence of people taking out variable rate mortgages during the pandemic.
If the recession turns out to be more severe than he expects, more workers are likely to lose their jobs and another leg down in the housing market is a real possibility, he warns.
His base case is that real estate prices will find a floor in the third or fourth quarter, he says, and Desjardins has pencilled in a rate cut by the Bank of Canada for October or December.
Looking farther ahead, Mr. Bartlett is concerned that slow sales in the current market for pre-construction condo units will lead to a shortage of units in the coming years. While a rush of supply will come on this year and next after a sales boom during the pandemic, that segment is currently in a slump and immigration is expected to increase.
In Toronto, meanwhile, the end of one year and start of the next has brought a sudden flurry of sales, agents say.
Christopher Bibby, broker with Re/Max Hallmark Bibby Group Realty, says some properties that had been lingering on the market all through the fall sold at the end of December or beginning of January.
“I never would have predicted January would be our opportunity,” he says of selling the various properties that were first listed in April, July and August.
Mr. Bibby says the opening salvo of many buyers is an offer well below the asking price, but some back-and-forth usually leads to an agreement.
“Frequently people will call just to gauge the motivation or how desperate we are.”
In one case, a unit at 55 Stewart St. was listed with an asking price of $2.595-million. The buyer chiseled that figure down to a sale price of $2,478,600.
In another case, sellers had actually taken their one-bedroom unit at 301 Markham St. off the market with a plan to relist in the spring. A downsizing couple who had looked at the unit when Mr. Bibby had it listed for $629,900 in the fall contacted him in early January and asked to see it again.
They struck a deal for $600,000.
Typically, condo units sold for between 3 and 6 per cent below the asking price, he says.
“People feel they need some cushioning if prices go down a bit.”
That’s a significant change from the fall when many properties did not even have showings, he says.
Long closings in the 120-day range are increasingly common these days, he adds.
Some agents have reported spirited bidding wars in the Greater Toronto Area – particularly when properties are listed with an asking price far below market value.
In the east end of Toronto, for example, a rundown two-bedroom house was listed with an asking price of $349,000 and drew more than 30 offers. It sold just above $600,000.
In Mr. Bibby’s opinion, most market participants are in no mood for the strategy of attracting eyeballs with an unrealistically low asking price. Listing agents report registered offers, he notes, and often just one offer is enough to discourage others who had viewed the property.
He says an effort to drum up a bidding war can backfire for the seller because they may not get the price they were hoping for and all other potential buyers will know it.
“The minute we say we have an offer, no one wants to compete downtown,” he says. “Once that notice goes out, all eyes are on you.”
With some confidence returning to the market, Mr. Bibby has six properties lined up to list in the coming weeks, but he points out that activity remains very unpredictable. He is not seeing any signs that suggest prices will skyrocket and recommends that potential sellers gauge their own comfort level.
“If the timing doesn’t feel right, don’t do it,” he advises sellers.
Elli Davis, real estate agent with Sotheby’s International Realty Canada, was surprised when two buyers submitted offers for different Bay Street condo units at 9 p.m. on a Saturday night.
Both condos were listed around the $1-million mark and deals firmed up within a few days.
A two-bedroom unit at Granite Place in midtown Toronto received two offers after Ms. Davis launched it during the first week of January.
The 1,312-square-foot unit was listed with an asking price of $1.195-million and sold for $1.3-million.
Ms. Davis says buyers and sellers continue to move for the usual reasons: They are leaving Toronto, expanding their family or downsizing.
“Not everyone is so affected by the economy and interest rates.”
Ms. Davis encourages potential sellers to list when there is so little inventory available, but she stresses that they also need to be realistic about the asking price. Some are dismayed about the tumble from the heights of early 2022.
“‘I don’t want to give my place away,’” is a common refrain, she says, as sellers adjust their mindsets to lower prices.
Her usual response to that is, “let’s look at what you made,” she says, pointing out the gains to sellers who have owned their properties for many years.
Manu Singh, real estate agent with Right at Home Realty Inc., says January was unexpectedly busy for him after a moribund final quarter to the year.
He saw a discernible shift in the segment below $749,000 while he was working with a first-time buyer who purchased a loft in a boutique building near Queen Street W. and Dovercourt Road.
Mr. Singh advised the young professional to take her time looking because units were languishing on the market. Suddenly 25 showings had been booked for the one-bedroom-plus-den unit on Dovercourt Road listed with an asking price of $707,900.
“I hadn’t seen this for months,” he says.
The sellers had already rejected one bid below the asking price when Mr. Singh’s client struck a deal with an offer of $715,500.
Mr. Singh believes pent-up demand from buyers who sat out the fourth quarter is one reason for the spurt. Many have preapproved financing lined up and they wanted to take advantage of the rate they were offered before the Bank of Canada’s January meeting.
In the months ahead, Mr. Singh expects the market to remain fairly flat. Investors are still reluctant to buy, he adds.
“I think rates have actually scared them.”
More tall towers being proposed, approved and completed in Vancouver, Burnaby, Surrey and Coquitlam
There are 20 development projects with towers over 45 storeys that are selling condo units, under construction or near completion.
He added that with increased land and construction costs, developers are motivated to use all the density they can get and build taller towers. However, there is also a point where it stops making sense to push higher “because things like the cost of structural systems increase as you go higher.”
Across Metro Vancouver, there are more than 20 towers over 45 storeys that have been approved by municipal governments, according to data from Zonda Urban market analyst Justin Lee. More than half of these are in Burnaby. Five are in Coquitlam and Port Moody, while Downtown Vancouver, New Westminster and Surrey have one each.
After these, there are 40 more tall-tower projects that have been publicly presented to city councils and are in some stage of seeking approval. Most are in Burnaby and Surrey, followed by Downtown Vancouver and Coquitlam.
“We’ll see if economic conditions allow for them to be built,” said Dikeakos, whose firm is working on the new tall tower approved in Surrey and other projects.
In late 2019, Pinnacle International Development made a proposal for a site near the Lougheed SkyTrain Station. It had three towers including one that would be 80 storeys and 250 metres tall. They would be the tallest buildings in Western Canada. Some more details were presented to Burnaby city council in May 2022 for towers of 80, 76 and 73 storeys, but the project has not progressed further with the city.
Metro King by Anthem Properties is a proposal for a 66-storey tower between Kingsway and Hazel streets across from Metrotown that is nearing a final decision by the City of Burnaby.
This pipeline of potential projects is happening as cities have focused on adding density to sites near transit stations and town centres, according to Dikeakos.
“The taller buildings in these types of developments that you are going to be seeing tend to be real, mixed-use ones, meaning they have a commercial base with significant office or hotel use where the first 15 to 20 storeys are commercial even before you get to the residential portion,” he said.
“One of the interesting changes that we’re seeing is that because these developments are being done near transit sites, cities are requiring less parking,” said Dikeakos. “If we had to do the same amount of parking required a few years ago, the depth of these excavations would make them completely unfeasible. (When) we’re not required to do as much parking, it allows us to do these taller towers and still make some financial sense.”
Even though developers are motivated to deal with increasing land and construction costs by building higher, there is a turning point. It will obviously be different for each project, but Dikeakos said that for the Station Square project, it was somewhere at the 52- to 55-storey height.
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