Real estate

Blockchain’s immutable ledger, which stores all transaction data in a single version of truth, has the potential, to make transactions smoother, faster and cheaper. A ledger which can identify the true ownership of title, proof of funds and can transfer title immediately, could revolutionise the sector.

An important aspect of this is the use of smart contracts. These are contracts that will execute when certain pre-determined outcomes are fulfilled. While smart contracts are often seen as beneficial from the perspective of quickening transactions, it is also proving useful from the side of determining identity as it enables lenders to be able to assess credit worthiness and mortgage suitability easier.

Finally, one of the key benefits of real estate on the blockchain is improving the liquidity of the sector. Real estate has several barriers to entry and with the length of time required to be able to liquidate a given asset, it often makes real estate less desirable for short-term investors. Blockchain helps to alleviate this problem and also introduces tokenisation.

Tokenisation is where, for example, a real estate opportunity is broken down into tokens which can be seen as ‘shares’ in the real estate opportunity. This means that more people can have a portion of the investment, and this can be traded much easier than the actual asset itself.

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