Important to know: A block chain or blockchain is a permissionless distributed database based on the bitcoin protocol – Wikipedia
The inclusion of a tamper proof technology in the dealings of financial transactions is set to revolutionize the whole endeavour. Blockchain, the data record credited as full proof, is slowly finding use in a lot of institutions. But even with its track record and security, it is still to find some worthwhile use in the market that is real estate.
Statistics show that the average owner of a home is bound to move around 11.7 times in their brief lifetimes. This means that a person is slated to buy and sell a home once every five years. The transactions can sometimes get more frequent depending on the individual. With such constant statistics, there is bound to be a home sold or bought at least twice each day. Real estate market prices thus affect one of every three adult Americans.
With most homes as an investment, it stands to reason that people would wish to protect what they spend their life savings on. The sad part is that this large market offers very little security to its participants, the lenders, owners or buyers. The process for home transaction also takes quite the time to finalize. HomeInsight suggested that the inclusion of Blockchain in the transactions is a guaranteed way to change the whole process completely. The transactions will the stripped of any fraud, made more and transparent and ultimately made faster. These three goals can be actualized in the following ways
Eradication of Fraud
The heavy dependency on the real estate market on third-party services during the financial transactions is due to the fear falling prey to fraud. With several fake properties and deeds available, most eager beavers willing to bypass the restrictions end up losing millions each year. Blockchain eradicates this by the issuance of digital certificates to the transacting parties. They are linked only to one property. These are impossible to replicate and as such, can’t be used for fraudulent reasons.
The Aspect of Transparency
The financial verifications of both parties are usually quite a tedious and long process, hindered by several administrations involved. Blockchain, however, offers a seamless easy and fast solution. All the users need to do is digitize their properties and their financial records. This means that the seller can instantly verify the buyer’s financial aspects with relation to mortgages and credit. The buyer can also be able to prove ownership of the seller. The houses could also get an account, and this would be used to subsequently monitor the history of the property throughout time. Owners, changes, and maintenance costs can in effect be made available to the interested candidates easily. This means that the transparency covers the property, buyer and seller all within one system.
Speedup of the Entire Process
The demand versus supply graph in the real estate sector isn’t the best as of now. There is quite a demand for homes to house the ever growing population, yet the rate of setting up new construction is falling quite far behind. This means that the price of current housing is skyrocketing in an unprecedented manner.
With the shortage of houses and unpredictable nature of the market, all buyers want is to expedite the entire process. This is quite a challenge with the real estate market being famous for its slow and tiring nature. This is in part thanks to the restrictions that the government has placed on the transactions themselves.
The restrictions may not face any change from the inclusion of Blockchain, it will, however, take care of the financial aspects. With the current market heavily dependent on third parties for safety and security, the extra cost and time taken make the process even slower. Blockchain actually offers verification within the blink of an eye, and transfer becomes that much faster.
The applications of Blockchain in the real estate market are endless and phenomenal. It would make the selling and buying of property faster and convenient, application of mortgages quick and effortless and the acquisition of loans on property quite convenient. With all this safety and transparency, all which is left is for some daring individuals to adopt this technology and make it the norm.