• Blockchain technology has the potential to revolutionize the real estate industry by increasing transparency, liquidity, and reducing minimum investment amounts.
• Tokenization of loans, houses, buildings and other assets could make them easier to manage with smart contracts enforced by software rather than people.
• Real estate has been one of the most valuable investments for billionaires in America and blockchain could provide a more efficient way for everyday investors to access it.
Real Estate on Blockchain
The real estate industry is one of the oldest yet most lucrative industries in America. Historically, it has been a favorite among wealthy investors such as Donald Trump and Warren Buffett. Now however, blockchain technology may open up real estate investing opportunities to everyday investors.
Benefits of Real Estate on Blockchain
Blockchain technology offers several benefits that can improve the real estate sector. These include increased transparency, improved liquidity, reduced minimum investment amounts and better asset discovery through tokenization of assets such as loans or houses. Smart contracts enforced by software would also make managing these assets much more efficient than traditional methods.
Real Estate Investing Accessibility
For over a year now, access to real estate investments have been largely inaccessible due to various restrictions imposed by governments around the world in response to COVID-19 lockdowns. A report from Citigroup states: “Traditional real estate often struggles with poor transparency, illiquidity and multiple intermediaries”; blockchain could be used as a “single shared source of truth” which would reduce these issues.
Trevor Bacon’s Opinion
Trevor Bacon – co-founder and CEO of Parcl – believes that tokenizing real estate assets would help people speculate on their prices just like any other stock or derivative markets. He said: “You can put [real estate] on the blockchain and it’s a much more efficient way to do stuff… We’re allowing people to speculate, hedge, bet and trade on real estate prices much like they would on any other type of stock or derivative” This goes against traditional banking methods which are slow and require manual labor instead of being governed through smart contracts enforced by software .
Conclusion
The use of blockchain technology in the real estate industry offers many benefits which can revolutionize its current inefficient state into something more accessible for everyone looking to invest in this lucrative sector regardless if you are an experienced investor or just starting out.