Real Estate Industry

The performance of the Fund depends on the receipt of royalty revenue which, in turn, partially depends on the level of residential resale real estate transactions. The residential real estate industry is affected by the many factors affecting the economy in general, including changes in interest rates, unemployment and inflation.

A significant portion of the Fund’s royalties is fixed in nature, based on the number of agents and their productivity. Since the number of agents does not change significantly from month to month, unitholders are largely sheltered from fluctuations in real estate sales volume and prices.

This section provides background on the real estate industry.