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One industry that stands to gain immensely from technology is none other than real estate. Nowadays, you can search for properties all over the world, just by sitting in front of your laptop or smartphone, within the comforts of your house. You also get the ability to take a look at different properties, without having to step inside.
When blockchain first came into the picture, most people only associated it with Bitcoin, a cryptocurrency. However after various experts in the real estate industry have taken a second look at this technology, they have realized its potential in transforming the majority of their core operations such as leasing, financing, sale, and purchase to name a few.
Currently, the real estate industry is facing a lot of problems due to outdated processes and technology. In most countries, information about property ownership and land registration still exists in paper records. Also, as documentation is not up-to-date, various entities can distort the context of the claims and deeds. If you need to verify and transfer ownership of a property, you will have to deal with a long, non-transparent, and costly process. On top of that, you have to keep an eye out on fraud, another common problem in the industry.
Blockchain gives the real estate industry the opportunity to address these ongoing problems. Everyone involved in the real estate industry, right from the customers to the agents will witness a positive impact with the introduction of this technology. To help you understand the impact of blockchain technology, here are four advantages the real estate industry will witness:
If you need to invest in property, you have to deal with agents, brokers, notary officers, and banks. When you think about it, the whole process is time-consuming and expensive, due to the involvement of various third parties. For example, to verify the documents, you will need the services of notary officers.
Similarly, when you have to find a property that meets your tastes and preferences, you will have to pay the agent for helping you out. You also need to involve banks, as you have to transfer funds to different parties. However, with blockchains, you no longer need these third parties in real estate operation. As a result of this, every process becomes cost-effective.
Data storage becomes secure, while management improves
One of the biggest problems with going digital is the fact that your data can end up in the hands of the wrong individuals such as cybercriminals. Once the data is in the hands of cybercriminals, they can change it for committing fraud. Blockchains aim to address this problem, by making it easier to store all the records of the property such as title chain, surveys, and deeds securely.
As blockchain encrypts the data, it becomes extremely hard for cybercriminals to access it. On top of that even if they bypass the security, they still need the approval of all the parties in the blockchain to introduce any changes. Also, these records are invulnerable, which means that you can’t lose or destroy them.
Faster and transparent transactions
As blockchains eliminate the need for third parties, every transaction speeds up exponentially. The database used by the blockchain will help in authenticating any transaction. Due to this reason, a homeowner can transfer the property title to the interested individuals, without having to get verified by another party.
Customers are demanding transparency, as it gives them a clear understanding of how operations take place in the real estate industry. As blockchains allow transactions to take place from peer to peer, all the information recorded is transparent.
Improvement in searching for properties
Tenants and owners have to use Multiple Listings Service (MLS) for gaining access to data on properties such as features, rental rates, and location. To use these services, you will need to pay a subscription fee. Even if it is free, it isn’t necessary that the details provided by the brokers are accurate. With considerable human intervention and lack of mandatory practices, there are very high chances of the data being incomplete and outdated.
In a blockchain data distribution to take place in a peer-to-peer network, while giving the brokers more control over it. However, the blockchains also make it easier for everyone to access the listings. Moreover, you can get complete details of all the properties, such as the age of the house, tenant details, and history of ownership to name a few. Due to these factors, searching for properties will improve remarkably.
These are the five advantages the real estate industry will witness with the introduction of blockchain technology. Blockchains offer solutions to real-world problems while becoming the backbone of the industry. Although this technology is still new, several businesses have already recognized its potential to uplift the industry!
Brought to you by BlockchainSingapore.