Real Estate

Developer Sued Regarding North Nashville Mixed-Use Projects

A developer who sought to revitalize a commercial strip in North Nashville is facing foreclosure and a lawsuit because of unpaid construction loans, the Nashville Business Journal reports. Chris Larkins of Pichoslap Development Co. LLC has been sued in Davidson County Chancery Court by BPI Realty LLC for failure to pay at least $566,544 of debt and interest. Nashville contractor Certified Construction Services LLC is accusing Larkin’s company of owing it around $683,684 for work performed. Davidson County Chancellor Ellen Hobbs Lyle will consider whether to freeze 13 properties that Larkins and his company own per a request by BPI Realty.

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Tennessee Homeowners Receiving Text Inquiries Regarding Unlisted Homes

Tennessee homeowners have been receiving unsolicited texts asking to buy their unlisted homes, sparking concerns over privacy and fraud abuse, The Tennessean reports. While existing FTC rules say sending commercial text messages without the permission of the individual receiving the message is illegal, it has not been determined if these texts are from private investors, which may be exempt from the rules governing “commercial text messages.” Director of Communications for the Tennessee Department of Commerce and Insurance Kevin Walters said that the department has not dealt with these issues in the past, but urges concerned parties to file a complaint if the sender does not verify that he or she is a licensed real estate agent.

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Amazon to Offer Real Estate Services

Online retail giant Amazon is making its foray into the real estate market with its new Turnkey program, the Washington Post reports. The company has teamed up with Realogy, an integrated provider of residential real estate services and parent company of brokerages such as Coldwell Banker, Sotheby’s International Realty, Better Homes and Gardens Real Estate, Century 21 and ERA to connect consumers with agents in their desired community. Homebuyers who purchase through the Turnkey system will receive credit towards smart home products and home services such as professional cleaning, assembling furniture and electronics installation.

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Nashville Council to Again Consider Banning Short-Term Rentals in Residential Zones

The Metro Nashville Council will again consider new restrictions on short-term rental properties — such as Airbnbs — in residential areas, The Tennessean reports. Nashville moved to issue a similar ban last year; however, the General Assembly nixed it because of concerns regarding the rights of property owners. The council will consider the bill in its July 2 meeting.

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Shadow Banks Back in the Forefront of Lending

“Shadow” banks have made a comeback and now surpass regulated banks as the leading source of credit for businesses and consumers, The Washington Post reports. Considered the catalyst for the real estate market collapse in 2008, the shadow system uses money from investors in lieu of depositors and heavily relies on hedge funds, investment banks and private equity funds. Loans from these sources are popular with consumers because of lower credit stipulations, faster approval and more flexible terms than loans from a traditional bank; however, they make the general economy more susceptible to busts.

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NAR asks Judge to Dismiss Antitrust Lawsuit

The National Association of REALTORS (NAR) has filed a motion to dismiss in the class-action lawsuit regarding antitrust concerns, Forbes reports. The suit, filed by Minnesota homeowner Christopher Moehrl, contends that NAR conspired with major real brokerages to inflate commissions using its Multiple Listing Services and compensation policies. NAR argues that the complaint violates Section 1 of the Sherman Act in connection with NAR rules related to the Multiple Listing Service and therefore should be dismissed. RE/MAX, Keller Williams, HomeServices of America and Realogy Holdings were also named as defendants in the case.

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Is a Two-Sided Market Coming to Commercial Real Estate?

Forbes yesterday published a piece exploring a two-sided market approach to maintenance of commercial real and whether this may prove to soon be a reality. The essay expands on the practice of smart physical systems in buildings and predictive maintenance, detailing how this might be leveraged to create a new model for how vendors, overseers and the equipment itself intersect. You can view the article here

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Redfin to Introduce Direct Property Bids on Its Website

Redfin, a national real estate brokerage that allows homebuyers to purchase properties without representation, is launching a program to offer consumers the opportunity to bid on properties directly through its website, The New York Times reports. The initiative was recently tested in Boston with sellers paying a 2 percent commission fee, which is half the normal rate for the area. Out of 120 homes listed between late March and early May through Redfin with web-based offers accepted, five were bought with online bids.

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Zillow Class-Action Suit Regarding RESPA Violations to Proceed

The class-action lawsuit filed against Zillow regarding its “co-marketing” program and whether it violated federal anti-kickback laws will proceed as planned, The Washington Post reports. The suit, filed in September 2017, alleges that the company ran afoul of the Real Estate Settlement Procedures Act (RESPA) by allowing lenders share advertising fees with real estate agents — up to 90 percent initially — effectually allowing the lenders to receive leads on active buyers. The Consumer Financial Protection Bureau (CFPB) in 2017 notified Zillow that it was being investigated regarding the alleged violations, to which the company attempted to negotiate with the bureau; however, the case was dropped when the Trump Administration appointed its new CFPB director. Judge John C. Coughenour of the U.S. District Court in Seattle denied Zillow’s motion to dismiss saying: “the court can draw a reasonable inference that Zillow designed the co-marketing program to allow agents to provide referrals to lenders in violation of RESPA.” A trial date has not been set.

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Metro Nashville Government Releases Report on Tax Incentive Funding

The Metro Government of Nashville & Davidson County released its Tax Increment Financing Study & Formulating Committee Report, which examines Metro’s Tax Incentive Funding (TIF) used to promote redevelopment in blighted areas. Mayor David Briley signed ordinance BL2018-1315 creating the committee to formulate recommendations on implementation of and ensure more transparency regarding the municipalities use of TIF. In its report, the committee compiled a number of observations and 17 recommendations, formally asking the Mayor’s Office to provide Metro Council with a description of agencies or departments that will address the recommendations, including cost estimates for implementation. The committee was scheduled to present its recommendations to the Metro Council last week. 

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