Real estate deals with land and buildings, this encompasses property valuation, property development, buying, selling, renting and leasing, financing, and documentation. Various activities are carried out in the real estate business and these processes are often tedious.
Blockchain technology can improve the processes and this will go a long way in deciding the future dynamics of real estate transactions.
Blockchain can be used to streamline property transactions, eliminating the intermediaries who charge hefty fees for their services.
It can do this through the use of a smart contract, a self-executing contract that operates on blockchain technology.
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Property owners can set up the contracts and once the terms are met the property will be transferred to the new owner automatically.
This would be recorded on the block as well as every other transaction involving any property so there is increased transparency and land ownership issues can be avoided.
This would also help with property management as all the records are traceable, therefore reducing risk and
fraudulent practices commonly seen in most real estate deals.
Blockchain can also open up new investment opportunities in real estate through digital assets.
These assets would be created and used as a representation of a real estate property, this way more people can participate and earn by owning the assets.
The application of blockchain in real estate transactions will improve overall efficiency, especially the time frame between the process of payments and the transfer of ownership, and this too, at a reduced rate.
Furthermore, blockchain technology will bring a form of standardization to real estate. From property valuation to associated regulations as everything will be stored on the block, it would show if the property is actually worth its ask and the agent isn’t just quoting big numbers accompanied by tales.
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With this, the future of real estate activities and transactions will be set to see more involvement
and growth than what is seen currently, and as blockchain technology evolves so will real estate.
There are however some challenges that might be faced in the application of blockchain to real estate transactions and its adoption.
One of which may be due to people not understanding how the technology works and some of the technicalities involved.
They might even be hesitant with the improved transparency, especially the agents as sometimes they make money through the loopholes currently in the system and that would be eliminated once blockchain technology is involved.
Addressing the above will require proper education to enlighten the real estate players, like stakeholders, buyers, sellers, agents, and investors on how to use blockchain technology in their transactions.
Also, to encourage adoption the implementation of some sort of incentives such as tokens that can be collected from each transaction will be helpful. These tokens can then be traded on the platform or used to invest in real estate.
In conclusion, there are interesting days ahead for the real estate industry with blockchain. However, it requires efforts from everyone in the industry to effect these improvements and maximize them.
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