7 Ways Blockchain Can Impact The Real Estate Market
The recent deluge of articles explaining the role of blockchain in real estate could hardly go unnoticed. Especially for those who work in the real estate and tend to be on the look-out for the most recent trends and innovations in the industry.
The articles describing the potential of blockchain technology for real estate are as numerous as they are diverse, but most of them fail to explain things in plain English. That’s why the goal of this week’s post is to do just that: explain in what particular ways the blockchain technology will solve the major bottlenecks of the real estate industry in the next few years.
What is Blockchain?
To begin with, we’ll need a clear understanding of the technology itself. What is it? How does it work? Is it yet another tech fad or a truly innovative technology that will soon turn the world on its head? Let’s clear things out.
First things first, blockchain is not another tech fad. Neither it is yet another bubble that will soon burst. Blockchain is a game-changer and a truly innovative technology that is commonly referred to as the new Internet. Although it was originally used in relation to cryptocurrencies like Bitcoin and Ethereum, its potential goes far beyond digital money. Blockchain technology can be applied to almost any type of transaction and improve its transparency and security tremendously.
As we explain in one of our previous posts, Blockchain technology provides a decentralized database of transactions visible for everyone in the network (a chain of computers used for verification, recording, and approval of transactions). Any transaction made on the blockchain is recorded and securely stored on many computers simultaneously. This means that the records of transactions are distributed to computers of all participants in the network, which makes information more protected from scam and fraud.
But what is important for us, people from the real estate, is that blockchain technology can make a positive impact on rental experience for everyone involved. What particular impact? Read on to find out.
More Transparency of Transactions
Transparency is the new black, and for a good reason. With today’s technologies like blockchain, it finally becomes possible to minimize the risks of corruption, fraud, and scam. Just like in any other industry, transparency in real estate is something everyone aims for. Blockchain allows for peer-to-peer transactions between landlords, tenants, and third parties, and ensures that all information about transactions is recorded and stored in a transparent way. This significantly reduces the chances of speculations and fraud.
Secured Storage of Data
Yet another advantage of blockchain technology is that it ensures secure online storage of data. This means that all transactions, documents, and personal data can be safely stored on the blockchain and retrieved at any moment if necessary. It is also worth being said that once recorded on the blockchain, information becomes impossible to change or edit. This, once again, reduces the risk of fraud and falsification of documents.
The next good thing about using blockchain in real estate is that it eliminates the need for middlemen like banks, notary officers, brokers, and agents. With blockchain, the entire real estate experience shifts towards a peer-to-peer model, which means there is no need to pay agents for their assistance in finding a property, notary officers for their help with validation of documents, and banks for transferring funds and exchanging currencies. With blockchain-based platforms like Rentberry, lots of spendings associated with renting sink into oblivion.
Improved Data Management
The term ‘data management’ might sound a little too general, but it has a lot to do with renting and can be significantly improved with blockchain technology. One of the core ideas of blockchain is that each transaction is distributed, permanently recorded, and encrypted, and can be associated with different levels of access to different users. In terms of data management, this means more accuracy and order, improved security and transparency. On top of that, this means that no document can be destroyed or lost — either intentionally or not.
Streamlined and Smooth Procedures
Since decentralized real estate platforms eliminate the need for third-party service providers like banks, attorneys, brokers, and others, the process of renting/renting out speeds up. When all bureaucratic and legal processes are automated and taken care of, lots of friction points simply disappear. As a result, both homeowners and tenants save themselves valuable time, while the process of renting itself becomes more smooth and stress-free.
One more advantage associated with blockchain technology is geographical freedom. And it is something that comes in especially handy since there are so many expats facing challenges when applying for rentals outside their home countries. With international currencies like BERRY tokens and standardized rental procedure, the process of renting and renting out will be equally seamless and stress-free for people from all around the globe.
Additional Investment Opportunities
Although commonly overlooked, this impact of blockchain technology on real estate is actually one of the most valuable and significant. Well, at least for those interested in good investment opportunities. The most innovative real estate companies on the global market have already announced their ICOs, which means lots of opportunities to gain rewards, benefit from bounty programs, and actually become the owner of tokens, which have a tendency to rise in value over time.
On the Final Note
Despite all the buzz around the topic of blockchain, the technology itself is still relatively new and many businesses only start to recognize the potential it may bring. Speaking of the real estate, in particular, it is already clear enough that blockchain will bring the quality of rental procedures to ever greater heights. The future is now: properties are being sold via blockchain, smart contracts start to replace traditional rental agreements, brokers and agents become unnecessary with automation of all rental tasks. The future is now, and it has a lot to do with blockchain.
Originally published at rentberry.com on November 29, 2017.