How Blockchain Will be a Game Changer for Real-estate Industry
Blockchain technology is at the helm of the real estate revolution. The real estate sector does not need traditional document storage and sales processes. The process of buying property has been experiencing a significant transformation because processes like property titles, insurance, ownership transfer, and escrow are all moving to blockchain solutions.
Traditional real estate markets have multiple redundant players such as, agents, brokers, attorneys, mortgage lenders, title companies, and many more, which forms a web of time-consuming and expensive processes. There are many other constraints like errors in land registry records, inefficient systems of tracking within the sales process, lack of transparency, and unnecessary fees that can hamper the growth of real estate business.
The blockchain is an encrypted record of digital ledger where information is stored over the entire network. The data in a blockchain can be viewed and stored simultaneously, allowing the real estate sector to streamline their business processes. The information in a blockchain network cannot be meddled with, as data stored in the digital ledger is immutable.
A significant issue for real estate sector is the legal procedures. Blockchain solution offers smart contracts, which require all the involved parties to comply with the regulations. Smart contracts can provide transparency to the system by taking care of the legal discourse. This will drastically simplify the processes for home buyers as well as builders.
Many countries have started to implement blockchain in their land registries. The aim of this implementation is to bring trust, transparency, and speed to property transactions. The blockchain solutions also provide a much-needed liquidity to the market with an improved system. Blockchain also offers fractionalization of property to increase liquidity further. Fractionalization is a new approach which allows an individual to own units or tokens in residential real estate. It can have a huge impact on the market as it empowers people to open up to the real estate market who would otherwise not be able to invest in it.
Apart from improving the traditional processes of real estate sector, blockchain can help to change the attitude towards real estate with improved transparency and efficiency.