Blockchain in real estate is the state-of-the-art in the modernization of this industry. Whích does it change in real estate transactions?
Real estate plays a vital role in the global economy. The global real estate market climbed from $8.9 trillion in 2018 to $9.6 trillion in 2019, according to MSCI. Although it looks like the industry is performing very well, it comprises several frictions and liquidity difficulties. The market is now too unpredictable to invest in, and only the wealthy have access to it.
Interestingly, throughout the years, several blockchain-based real estate firms have been formed to disrupt the process of transactions. This technology will eventually render traditional real estate methods obsolete. That’s why, in this guide, I’ll go through how blockchain is disrupting real estate and why it’s the greatest option at the time for real estate efforts.
Platforms for trading and online marketplaces
With the advancement of technology, internet platforms and markets have changed how we see real estate. Sites like Zillow and RedFin have made transactions more accessible and practical for everyone interested in investing, especially while the world is under lockdown due to a pandemic.
The evolution of trade platforms and online markets, on the other hand, is only getting started. The use of blockchain in real estate is just now getting traction. More individuals will be able to engage in the real estate sector without the worry of harmful trades thanks to blockchain real estate apps. As a result, trading platforms will be more safe and faster, saving everyone a lot of time and money in the long run.
There Isn’t Any Need For Intermediaries
Tal Shelef, Realtor and Co-Founder of Condo Wizard, is one of several industry professionals who believe blockchain real estate could disrupt how transactions are conducted. He believes “middlemen” would be the first to be impacted. “Blockchain is certain to disrupt the real estate sector or any industry for that matter,” Shelef adds, “since it will eliminate the confusing and expensive process of bargaining with a market intermediary.”
Blockchain has been hailed as one of the most secure trading systems for years. The absolute nature of each data set has shown to be infallible and impregnable to manipulation (up to this time). As a result, blockchain technology has evolved into a superior kind of escrow. A digital marketplace enables parties to exchange products without worrying about the intermediates.
Real Estate Is Transformed Into A Liquid Asset
The ability to tokenize real estate increases the liquidity of the whole asset class. Real estate assets were not liquid before tokenization, and they are still not particularly liquid now. Investors or homeowners who want to get into the capital behind an asset must first consider selling it. Once a selection is made, the asset is offered to potential purchasers and it will go through a closing procedure.
Fractional Ownership Is Possible With Blockchain
Not only does the tokenization of real estate provide owners and investors with faster access to funds, but it also lowers the entrance barrier for potential owners and investors. It is no longer essential to spend an excessive quantity of money on a single investment thanks to tokens. On the other hand, tokens allow buyers to engage in partial ownership. If five tokens represent an apartment building’s equitable stake.
Real estate blockchain apps can operate as their escrow on their own. Using the blockchain to conduct transactions might eliminate the need for several professional businesses that specialize in facilitating transactions. As a result, those who transact on the blockchain won’t have to pay the excessive costs that have come to be associated with escrow services.
Instead, each party to a transaction may rely on the algorithms run by nodes on blockchain’s powerful computer network. While the notion may be frightening, blockchain real estate applications would be one of the safest and cheapest methods to conduct a transaction. It is time for all the real estate enterprises have a shoot to be the leader in this industry
Documents that have been digitized
Smart contracts may work on blockchain real estate since it is a digital platform. Smart contracts, as their names imply, are superior rather than regular contracts in practically every regard. Blockchain can “establish, authenticate, and audit contracts in real-time, across the globe, and without the intervention of a middleman,” according to Nick Clare, Head of Project Management have instructions embedded in the transaction.
Blockchain for real estate is a field that requires more global exposure. Corruption and illegal activity abound in this industry. However, the significance of this industry is at an all-time high right now. As a result, without suitable norms in place, this sector will not thrive and eradicate corruption for good. It’s time for a change, and blockchain is more than capable of providing it.
akaChain is backed by FPT Software, a globally leading technology, and IT services provider. It is an end-to-end, permissioned, multi-chain network based on the Hyperledger Fabric. Since its establishment in September 2018, akaChain’s product has assisted many enterprises, from SMEs to Fortune 500 firms, to transform with distributed ledger technology. The company provides a broad range of permissioned blockchain-based products and services in multiple sectors, including retail, supply chain, banking and finance, insurance, shopping mall management, etc. to transform with its distributed ledger technology. For more information, please visit https://blog.akachain.io/
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