Twitter is being taken to court in the UK by the Crown Estate, which manages the property portfolio owned by King Charles III, over an alleged failure to pay rent on its London office.
Insider understands that the Crown Estate has issued court proceedings to Twitter following previous contact with the social-media company over unpaid rent, and that two parties are currently in discussions.
All the Twitter signs and logos have been removed from the London office, but Elon Musk’s company still occupies it, according to The Daily Telegraph, which first reported on the lawsuit.
Employees in Singapore were even temporarily evicted from their office due to nonpayment of rent – before Musk ultimately paid up later that day, Insider’s Kali Hays previously reported.
Twitter did not immediately respond to Insider’s request for comment.
The Crown Estate manages $19.2 billion worth of properties including 241 in central London, according to its most recent annual report. As the property is ultimately owned by the monarch, three-quarters of the Crown Estate’s $384 million net revenue profit goes towards public spending in Britain – with the rest given back to the royal family.
The Guardian reported last week that King Charles had asked for the profits from a $1.2 billion portfolio of offshore wind farms owned by the Crown Estate to be used for public funding.
Luxury home prices have been rising at a steady pace, and so far this year, values have hit a fresh record high. According to a new Q1 report by the real estate site Redfin, the cost of luxury residential properties—those estimated to be in the top 5 percent of their respective metro area—rose by 9 percent compared to last year and increased twice as fast as non-luxury homes. At the same time, high-end abodes sold for a median price of $1.22 million in the first quarter, a new benchmark from the $1.17 million set in the fourth quarter of 2023.
“People with the means to buy high-end homes are jumping in now because they feel confident prices will continue to rise,” explained David Palmer, a Redfin Premier agent in the Seattle metro area, where the median sale price for luxury homes is a whopping $2.7 million. “They’re ready to buy with more optimism and less apprehension. It’s a similar sentiment on the selling side: prices continue to increase for high-end homes, so homeowners feel it’s a good time to cash in on their equity.”
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To that point, the number of sales of luxury homes saw a 2.1 percent uptick from the year prior. In January, luxury sales began seeing consistent, year-over-year increases for the first time since August 2021. Another notable trend is that buyers are shelling out all-cash offers. Per the report, 46.8 percent of high-end residences purchased between January and March 2024 were paid for in cash, a staggering 44.1 percent gain from last year and the highest percentage in a decade.
Luxury home prices in Providence, Rhode Island increased 16.2 percent in the first quarter of 2024.
Redfin found that Providence, Rhode Island, had the biggest jump in luxury prices in Q1, with values rising to $1.4 million, a steep 16.2 percent gain. Next was New Brunswick, New Jersey, where the median sale price bounced up 15 percent to $1.9 million. On the flip side, there were eight metros where luxury home prices dipped. Leading that pack was New York City, where prices dropped 9.9 percent to $3.25 million, followed by Austin, Texas, with a 6.9 percent decline.
David Siscoe has some advice for fellow renters across the country: get proof that your landlord is paying their taxes, or at least make sure you’ve got a property manager who’s responsible.
Mr. Siscoe is the Montreal tenant who was audited and assessed by Canada Revenue Agency in 2018 and ordered to pay six years’ worth of his non-resident landlord’s withholding taxes, as reported recently by the Globe and Mail. Mr. Siscoe says he did not know his landlady was a non-resident.
He also didn’t know that tenants renting from a non-resident are required to withhold and remit 25 per cent of their rent to CRA each month, unless they have a property manager doing it for them, or if the non-resident has made alternate arrangements to pay their taxes.
“How is there no onus on the CRA to make sure that tenants are aware of this?” he asks. “I didn’t have a clue.”
The CRA had been unable to collect from his overseas landlord. He was then assessed for the unpaid withholding taxes, as well as compounded interest and penalties that added up to about $80,000, he says. In March, 2023, he took the Minister of National Revenue to Tax Court and lost.
The only break he was given was a reduction in the number of years he owed for, from six to three. He says he now owes around $43,000, although he believes more interest and penalties have since accrued. And he’s already paid nearly double that amount in accounting and legal fees.
Mr. Siscoe and his wife were paying nearly $3,000 a month in rent at 501-4175 Rue Sainte Catherine ouest, in Westmount, Que., an enclave of Montreal. Mr. Siscoe is a 1988 Canadian Olympic athlete and two-time taekwondo world champion who owns a gym.
The 61-year-old said he still hasn’t settled his debt with CRA, and his lawyer told him that it’s unlikely they’ll be willing to negotiate.
“They were acting like a dog on a bone,” he says of his initial communications with the tax agency. “They proceeded to suggest that we were knowingly paying a non-Canadian resident money, and I was a little flabbergasted.”
“I said, ‘You are trying to suggest I knowingly paid her 100 per cent of the rent because I wanted to be burdened with her tax implications? Is that what you are trying to suggest?’ I felt like this is a joke somehow.” Mr. Siscoe explained that he had rented unit 501 for more than 20 years, going back to 1996. He says that in 2010, the landlord told him to start making the rent payments to his sister. The new lease agreement had a Montreal address on it, and he hadn’t paid attention to the fact that the new landlady had signed the document in Italy, he says. Mr. Siscoe said she visited the apartment a few times over the years, and it was only after he got audited that he discovered she was living in Italy. After he realized he was on the hook for her tax bill, he and his wife and their kids moved out of the unit a few months later.
Mr. Siscoe did not want to share his landlady’s contact information for this story, on advice of counsel.
After the Siscoe family moved out, they learned that the former landlady had put the condo on the market, and Mr. Siscoe notified the CRA that they had an opportunity to collect the taxes she owed. He never found out if they tried.
In court documents, Mr. Siscoe argued that his landlord had given a Canadian address on the deed of sale when she purchased the unit; she had a Canadian social insurance number; and his rent cheques were going to a TD Canada account in Montreal.
Also in court documents, the CRA provided evidence that showed the landlord hadn’t filed income tax returns; she didn’t have any links to property in Canada other than the rental unit; her phone number on the lease was an Italian phone number; she had used an Italian e-mail address to correspond with Mr. Siscoe; and she had told the CRA auditor she lived in Italy.
The withholding tax has been around for decades. The problem for tenants arises when a non-resident landlord doesn’t pay it. And non-resident owned properties represent a substantial share of the secondary rental market in Canada.
Considering the risk to tenants – amid a housing crisis – Mr. Siscoe wonders why CRA didn’t put a lien against the rental property, or at least act to collect on the debt when the property sold.
Mr. Siscoe’s lawyer, Mr. Luu, says that all the CRA must do is establish liability to collect on the debt, and he said there doesn’t appear to be a guideline on how they do that.
“Whether the CRA could have collected the rent in some other way does not impact his liability under the law. The CRA and the Tax Court have to apply the law as it is written.
“That’s why if we want any meaningful change, we need to change the law and it’s for the Department of Finance to intervene.”
In an e-mail response, Caroline Theriault, deputy spokesperson and media relations manager for the Department of Finance, said that the requirement for renters helps to ensure that CRA obtains information on rental income non-residents might be earning in Canada. It also “helps facilitate collection of the resulting tax,” she said.
“This does not cost renters anything,” said Ms. Thériault, adding that it is standard practice.
A CRA spokesperson said in an e-mail that they encourage non-resident landlords to hire property managers. Otherwise, tenants are required to withhold the amount and fill out a Form NR4.
“If the non-resident fails to remit, the tenant is responsible for the full amount,” said the statement.
CRA’s practice is to “make every effort” to assess the non-resident owner rather than the individual tenant.
The agency pointed to a legal website that offered tips on ways renters can protect themselves, including a land title search on the landlord, asking the landlord for a certificate of residency, writing an indemnity clause into the lease agreement, and being on the lookout for any requests to redirect rent payment to someone else.
Adam Chambers, Conservative shadow Minister for National Revenue, which oversees the CRA, took issue with the policy and called the CRA’s reaction “cruel measures in the tax code that unfairly punish renters who have done no wrong.”
Real estate lawyer Ron Usher, who is general counsel for the Society of Notaries Public of B.C., where a non-resident owns one in 10 new condos, says that for every sale by a nontax resident, a clearance certificate from CRA must be obtained.
“Until CRA provides it, the notary will retain the amount in trust.”
To prevent Mr. Siscoe’s situation, he suggests a system whereby CRA is notified of any non-tax-resident real estate purchases. At that point, CRA would send the purchaser notice of tax obligations and issue an individual tax number if they don’t qualify for a social insurance number.
Mr. Siscoe said he is doing his best not to dwell on the situation. But he wants Canadian renters to beware.
“Don’t get me wrong. If me being angry could change the outcome, yes, I would be angry. But I’m not going to let them take more from me than they’ve taken,” he says.
“As an athlete, I spent my career travelling around the world, holding my country’s flag … but your own country can say, ‘Let’s screw him over.’”
He and his wife are renting another place, but it’s different this time.
“Right away I said [to the landlord], ‘I need to know you are paying your Canadian taxes, and I need it in writing.’”
A settlement that will rewrite the way many real estate agents are paid in the United States has received preliminary approval from a federal judge.
On Tuesday morning, Judge Stephen R. Bough, a United States district judge, signed off on an agreement between the National Association of Realtors and home sellers who sued the real estate trade group over its longstanding rules on commissions to agents that they say forced them to pay excessive fees.
The agreement is still subject to a hearing for final court approval, which is expected to be held on Nov. 22. But that hearing is largely a formality, and Judge Bough’s action in U.S. District Court for the Western District of Missouri now paves the way for N.A.R. to begin implementing the sweeping rule changes required by the deal. The changes will likely go into full effect among brokerages across the country by Sept. 16.
N.A.R., in a statement from spokesman Mantill Williams, welcomed the settlement’s preliminary approval.
“It has always been N.A.R.’s goal to resolve this litigation in a way that preserves consumer choice and protects our members to the greatest extent possible,” he said in an email. “There are strong grounds for the court to approve this settlement because it is in the best interests of all parties and class members.”
N.A.R. reached the agreement in March to settle the lawsuit, and a series of similar claims, by making the changes and paying $418 million in damages. Months earlier, in October, a jury had reached a verdict that would have required the organization to pay at least $1.8 billion in damages, agreeing with homeowners who argued that N.A.R.’s rules on agent commissions forced them to pay excessive fees when they sold their property.
The group, which is based in Chicago and has 1.5 million members, has wielded immense influence over the real estate industry for more than a century. But home sellers in Missouri, whose lawsuit against N.A.R. and several brokerages was followed by multiple copycat claims, successfully argued that the group’s rule that a seller’s agent must make an offer of commission to a buyer’s agent led to inflated fees, and that another rule requiring agents to list homes on databases controlled by N.A.R. affiliates stifled competition.
By mandating that commission be split between agents for the seller and buyer, N.A.R., and brokerages who required their agents to be members of N.A.R., violated antitrust laws, according to the lawsuits. Such rules led to an industrywide standard commission that hovers near 6 percent, the lawsuits said. Now, agents will be essentially blocked from making those commission offers, a shift that will, some industry analysts say, lower commissions across the board and eventually force down home prices as a result.
Real estate agents are bracing for pain.
“We are concerned for buyers and potentially how we will get paid for working with buyers moving forward,” said Karen Pagel Guerndt, a Realtor in Duluth, Minn. “There’s a lot of ambiguity.”
The preliminary approval of the settlement comes as the Justice Department reopens its own investigation into the trade group. Earlier this month, the U.S. Court of Appeals for the District of Columbia overturned a lower-court ruling from 2023 that had quashed the Justice Department’s request for information from N.A.R. about broker commissions and how real estate listings are marketed. They now have the green light to scrutinize those fees and other N.A.R. rules that have long confounded consumers.
“This is the first step in bringing about the long awaited change,” said Michael Ketchmark, the lawyer who represented the home sellers in the main lawsuit. “Later this summer, N.A.R. will begin changing the way that homes are bought and sold in our country and this will eventually lead to billions of dollars and savings for homeowners.”
Under the settlement, homeowners who sold homes in the last seven years could be eligible for a small piece of a consolidated class-action payout. Depending on how many homeowners file claims by the deadline of May 9, 2025, that could mean tens of millions of Americans.
