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Document offers more details about real estate agency's alleged problems – CBC.ca

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More information has emerged about the allegations against a New Brunswick real estate agency that a regulator wants shutdown. 

The Financial and Consumer Services Commission announced Tuesday it filed an application seeking to revoke the licence of Century 21 A&T Countryside Realty Inc. 

However, few details were offered beyond a news release. The Financial and Consumer Services Tribunal, which would hear the request, released a copy of the statement of allegations Wednesday. The statement names the agency and a manager as respondents.

The document alleges there were repeated instances in which a trust fund account had insufficient funds compared to what it should have held, funds were used “for purposes other than the terms on which it was received,” funds were withdrawn before they should have been, and there were complaints about late commission payments. 

In the period between an offer being accepted an the closing date, a buyer may be required to provide a deposit. 

The Real Estate Agents Act states that when an agent receives a cheque as a deposit with an offer, the money must be placed into a trust account when the offer is accepted.

Agency to defend itself

A&T Countryside Realty has not provided an interview. In a statement to media on Wednesday, the agency said it takes the allegations seriously and has spent “considerable time and resources addressing” the commission’s requests.

“Century 21 A&T Countryside Realty Inc. will defend the allegations and welcomes the opportunity to tell its side of the story at the Tribunal,” it stated.

The agency’s statement says it takes issue with the commission’s news release issued Tuesday because it doesn’t contain all of the facts and could be misinterpreted.

The statement did not address some of the more specific information laid out in the statement of allegations. A lawyer representing the agency did not respond to a request for an interview.

The statement of allegations says there were complaints from the real estate industry about late commission payments from A&T Countryside Realty. (Pierre Fournier/CBC)

The statement says the agency opened its first office six years ago in Moncton. The commission has said the agency now has 24 sales people with offices in Fredericton, Rothesay, Saint Andrews, Shediac, and Campbellton.

The complaint names a manager who worked at A&T’s Moncton office since 2016. It says the person oversees sales records of agents by ensuring proper document handling, record keeping, and trust account administration.

The manager declined to comment. 

The alleged violations largely centre on the trust accounts, saying rules were repeatedly violated. 

The Respondents also apparently do not consider the repeated trust account breaches to be serious, as they have not corrected the deficiencies brought to their attention.– Statement of allegations

“It further appears that the trust fund handling by the Respondents has been deficient since the opening of the agency, and that the Respondents did not have the proper procedures in place to oversee proper trust account administration,” the statement of allegations says.

It says attempts to bring the agency into compliance over several years have not led to changes in practices. 

“The Respondents also apparently do not consider the repeated trust account breaches to be serious, as they have not corrected the deficiencies brought to their attention,” the document states. 

The statement of allegations says the agency has 30 days from the time it receives the document to file a notice it intends to defend itself. It’s unclear how long it may take for the tribunal to hear the issue and make a decision.

In the statement to media saying it would defend itself before the tribunal, the agency said it will “continue working with [the commission’s] reasonable and necessary requests.” It also said the agency remains open and operational.

New Brunswick RCMP spokesperson Sgt. Nick Arbour said the force has not received a complaint about the agency.

The New Brunswick Real Estate Association, which co-regulates the real estate industry with the Financial and Consumer Services Commission, did not provide an interview.

In an emailed statement, it only said it respects the commission’s role in “taking any necessary steps to initiate enforcement proceedings in the interest of protecting the public.”

The association referred any other questions to the commission. The commission in turn said it wouldn’t comment and directed CBC News to the statement of allegations.

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This Week's Top Story: Canada's Real Estate Bubble Eliminated By Data Revision & More Experts See Lower Prices – Better Dwelling – Better Dwelling

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This Week’s Top Story: Canada’s Real Estate Bubble Eliminated By Data Revision & More Experts See Lower Prices – Better Dwelling  Better Dwelling



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Edmonton commercial real estate market hits $1.46B in sales mid-2022: report – Edmonton Journal

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Edmonton’s commercial real estate market saw a boost in investment activity during the first half of 2022, according to a mid-year market report.

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Total commercial real estate investment jumped by more than $930 million to $1.46 billion in the second quarter of 2022, said the report from intelligence firm The Network.

President and owner Nathan Gettel attributed part of the gain to lower interest rates for borrowing money earlier on as well as investment from outside the province.

“We saw a lot of B.C. and Ontario purchasers coming to Alberta because those markets are starting to get priced quite high,” he said. “They see quite a bit of upside in Alberta right now, so it’s contributing to a lot of sales and higher prices.”

Overall, year-over-year sales increased more than 120 per cent, the report said, pointing to a “renewed appetite” for industrial property, multi-family properties and undeveloped land compared to the first quarter.

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Industrial property investment sees ‘enormous’ increase

The firm said there was a notable year-over-year increase in the sale of warehouses used by owners. These owner-user properties accounted for 55 of the 79 transactions in the first half of 2022 and $170.8 million in sales, the firm added, while eight transactions involving single-tenant warehouses accounted for more than $254.5 million over the same period.

Investment in industrial warehouses overall saw an “enormous quarter-over-quarter increase” of just under $440 million over 44 transactions, the report said.

Gettel said Edmonton has a strong industrial sector, and properties in the city have drawn interest from large real estate investment trusts (REITs)

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“They’re a good investment in Alberta,” he added.

Investment in multi-family properties also saw a marked climb in the second quarter, the report added, noting 24 transactions that closed for more than $185 million — almost double the value of sales in the first quarter.

By the end of June, there were 42 transactions involving multi-family properties, accounting for more than $397.8 million in sales, the firm reported, adding that row house properties were of particular interest with three selling for more than $25 million each.

News of the upswing in the multi-family asset class follows a reported downturn in the residential market that saw unit sales in July fall 10.3 per cent compared to the same month the year before, and  fall 23.8 per cent compared to June.

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Single-family home sales in July fell 24.4 per cent compared to the month prior, while condo sales dropped 22.1 per cent and duplex units fell 21.3 per cent month-over-month.

Commercial condo sales up from ‘shy’ first quarter

The first quarter of 2022 saw $78.8 million in land sales in the first quarter — a figure that roughly doubled to about $159 million in the second quarter, the firm reported.

By mid-year, 73 transactions accounted for $238 million in sales, the firm added, breaking a four-year record set in mid-2019 that reached $233.4 million and a two-year slump reported in the first halves of 2020 and 2021.

The firm lists Air Products Canada Ltd.’s $60-million purchase of 150 acres in northeast Edmonton as a “stand-out transaction” in 2022 thus far.

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By mid-2022, there was $53.5 million in commercial condo sales over 83 transactions — nearly double 43 transactions seen in a “lackluster first quarter,” the report said.

Early 2022 saw mounting cases of COVID-19 spurred by the Omicron variant. The effects of the COVID-19 pandemic may have led investors to shy away from the market in that first quarter, Gettel said.

“Those sales started trickling in towards the second quarter,” he added.

The first half of the year also saw a high demand for industrial condos, the firm reported, which accounted for 65 per cent of 83 transactions in that asset class (compared to about half of transactions in previous years), and more than $33.7 million in sales.

However, the report said there was only $4.3 million in retail condo sales by the end of June, which is down from about $22 million in mid-2021.

— With files from Kellen Taniguchi

hissawi@postmedia.com

@hamdiissawi

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Metaverse Real Estate Under Water – Forbes

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Late last year, a flood of cash from tech enthusiasts and corporate marketers ignited real estate prices in the metaverse. Alt-coin owners and CryptoPunk NFT collectors with stars in their eyes and cash in their pockets looked to justify soaring prices by buying properties near those of celebrities, many of whom were using the metaverse for promotional purposes, rather than, say, the view.

To say that the boom was not built on solid foundations is both accurate and an understatement.

Snoop Dogg, to take one high-profile example, built a digital replica of his Southern California mansion in the middle of the Sandbox metaverse, calling the 144-parcel square the Snoopverse. Snoop’s virtual neighbors include the mega-DJ Steve Aoki and a handful of massive Atari developments, where visitors can play the company’s games and attend events.

Record-setting purchases hit headlines soon after, like when one buyer, known only as P-Ape, spent $450,000 on a nine-parcel property right next door to the Long Beach rapper. Just down the virtual block, an anonymous buyer paid 25 ETH—worth about $60,000 at the time—for a single parcel, which measures 16-by-16 meters.

Prices peaked around the start of this year, but a crypto bear market and slower-than-expected metaverse adoption have ravaged prices, down 85% since January, and purchase volume, which has almost disappeared.

P-Ape’s parcel could now be worth barely $25,000, though having Uncle Snoop as a neighbor likely provides a small boost. A digital map of the Sandbox shows dozens of properties up for sale. Some ambitious sellers have list prices in the hundreds of thousands, but the current market says that won’t happen anytime soon.

The average price of a parcel at five of the largest Ethereum-based metaverse projects fell to around $2,500 from almost $21,000 in January, according to WeMeta, a metaverse data and analytics company. The drop was even sharper at the Sandbox, the largest metaverse world by volume of land sold, where the average has fallen to about $2,800 from $35,500. The weekly volume of property purchased across the top-five metaverse worlds has fallen to $650,000 for the week of August 7, down from $62.5 million in mid-November, a drop of nearly 99%.

“Metaverse investments are risky. There’s a very high likelihood that you’re going to lose everything,” says Fabian Schär, a professor at the University of Basel and the managing director at the school’s Center for Innovative Finance.

Most corporate property owners purchased their land for marketing purposes, hoping to place experiential advertisements or virtual storefronts along the most crowded boulevards in metaverse metropolises. Samsung built a virtual version of its flagship New York store, allowing guests to test products. Adidas owns property in the Sandbox where it hawks digital athletic gear as NFTs.

These businesses paid hundreds of thousands of dollars when metaverse and crypto hype were high and money was flowing into digital assets. The harsher economic outlook has made it harder to justify spending that money on land in virtual worlds. But the utility—or lack thereof—is mostly unchanged.

“The vast majority of utility is still there, but it’s declined in price for other economic reasons,” says Lorne Sugarman, the CEO of Metaverse Group, a virtual real estate company. Sugarman adds that he isn’t concerned about falling prices, as his company expects to hold properties for years to come as utility increases with adoption.

“We don’t see a significant decrease in traffic numbers. But that being said, traffic has never been particularly high,” Schär says. “What has changed is people’s expectations.”

Those remain sky-high for some. The management-consulting giant McKinsey projected in June that the metaverse could grow into a $5 trillion market by 2030, which would equal the size of Japan’s economy, the third-largest in the world.

Billionaire businessman Mark Cuban has been one of the loudest critics of metaverse land sales, despite his investment in Yuga Labs, the creator of Bored Ape Yacht Club (BAYC) and its corresponding metaverse world, Otherside. Yuga brought in approximately $320 million by selling Otherdeeds, NFTs that granted ownership to 55,000 parcels of land in the BAYC’s virtual hangout spot.

“The worst part is people are buying real estate in these places. I mean, that’s just the dumbest shit ever,” Cuban said in an interview published Sunday on the crypto-focused YouTube channel Altcoin Daily. Cuban added that purchasing metaverse land was dumb “because there’s unlimited volumes that you can create.”

Cuban added that he thinks some properties will have value once the community in that metaverse is stronger. To his point, the most valuable metaverse land is located in areas where chance encounters were boosted by already-present communities, according to a paper by Schär and fellow researchers.

“It’s an attention economy. People are interested in having the land in places with a lot of foot traffic,” says Mitchell Goldberg, a Ph.D. candidate at the University of Basel and one of Schär’s co-authors. “But, if the attention for the whole world decreases, then the prices for all of these land parcels will decrease.” Goldberg adds that while he believes that Cuban was right that new metaverse land can always be created, companies can’t manufacture the attention.

Another key factor is a memorable address. Metaverse visitors can teleport anywhere within a particular virtual world by typing in X, Y coordinates. Schär said catchy numbers, like 100 degrees by 100 degrees, led to more visitors than, for instance, 271 and 73.

Some businesses have benefited from using short-term rentals instead of purchasing metaverse property. Companies like Sugarman’s Metaverse Group rent land and have a team of developers to build out their tenants’ visions.

The Australian Open rented virtual land from a different metaverse company to host a festival concurrent with the annual tennis tournament. The space included digital stadiums where enthusiasts could interact and watch historic matches together.

Sugarman says his company expects adoption to rise in the next one to three years, but he doesn’t see that happening without more development of traffic-driving features like better games. Metaverse Group has taken advantage of the price drop to build on cheaper land, and Sugarman said he thinks other firms understand that now is the time to develop.

“There needs to be other tools and different experiences to make the metaverse more interesting, and that will drive traffic,” Sugarman says. “As there’s more understanding and more learning, we believe that critical mass will happen.”

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