Blockchain technology could change the way people buy and sell real estate properties. In today’s digital world, there are technology advancements such as blockchain. It could enable the real estate industry to address its inaccuracies and inefficiencies. In 2015, the World Economic Forum conducted a survey. Around 800 information and communications technology sector experts participated. An estimated 57.9 percent believe that blockchain technology has a great future. They think it will store as high as 10 percent of the global GDP information by 2025.
Blockchain started out as the technology behind Bitcoin. Recently, the real estate industry realized how blockchain-based smart contracts could transform operations. Also, it could make things more efficient. Over the years, blockchain can impact even public utility services. Examples are water, energy and waste billing, and smart parking.
In this article, we will tackle blockchain technology in real estate. How it can benefit property management and leasing. Also, how it can affect buy and sale transaction processes.
Benefits of Blockchain Technology
1. Trustless Environment
A cryptographic proof is a basis for blockchain. It can allow two different people to transact with one another without any need for a third party. As a result, it decreases the chances of fraud. Also, the removal of third parties removes any excessive transaction fees. It can also reduce expensive costs for services such as lawyers, banks, agents and a lot more.
2. Distributed Ledger
Blockchain technology peer-to-peer distributed network can record the public history of transactions. As a result, it allows a secure source of proof for a transaction occurrence. When integrated with real estate, it provides transparency between deals.
3. Near Real-time
Blockchain supports near real-time settlement of transactions. Thus, reducing any risk and removing friction. At the same time, it has a limiting ability to cancel any transaction and chargeback. Today, transactions take days and even weeks because of the processes it undergoes. With blockchain, it can remove all these and provide faster transactions.
For every transaction, blockchain is capable of having a verifiable and individual record. Because of this, it can diminish the risk of fraud, double spending, and abuse of transactions. Imagine not having to worry about using your hard earned money.
5. Censorship Resistant
Blockchain has crypto economics built in. This feature gives incentives for users to have a continuous validation of blocks. It can also reduce the possibility of external influencers. Let’s not forget, the modification of recorded transaction records.
Blockchain technology has its unique characteristics. It can be useful in addressing the inefficiencies of the real estate or any industry for that matter. But, companies should assess where they can integrate such technology into their processes. It should meet a few prerequisites for the blockchain to be relevant. Companies have to check benefits and costs for operations available for blockchain. They can assess the extent of overhauling the existing systems. Even the interoperability with other technology systems. These systems which the various stakeholders of CRE transactions use.