All industries are changing and the same is true for the Real estate market in the US. New and innovative investment ways are introduced, and blockchain real estate technology is one of them. This trend is getting popular with every passing day. Not only buyers but sellers and investors like it too. Investors are integrating traditional real estate investment with blockchain technology and it brings a revolution in transactions and investment properties. Here we are discussing some basic information about blockchain technology and how it is shaping the real estate market.
Blockchain is a difficult concept to understand. Let’s start with the basics. It’s important to know the roots of this technology. Real estate agents were called middlemen during the last century. But now the market has changed and the first blockchain was introduced in 2009. The first transaction with blockchain in real estate was completed in 2018. So, the use of blockchain technology is not new in the real estate market.
If we define blockchain, it’s like a database, which is decentralized and digitally distributed. It is the technology that makes transactions easy by securing data. Tracking digital assets is also very easy. So, when we think about blockchain, the first thing which comes to mind is cryptocurrencies. But blockchain is not like any regular database.
How is Blockchain different from a regular database?
These two are different in many ways. But the key difference is the structure and organization of information. In the blockchain, information is grouped into blocks and they are linked together. These blocks have different storage capacities. When the current block is filled, it is linked with the previous block and it joins the chain and a new block is formed to store incoming information. There are different blockchain networks, public and private. Everyone has access to public blockchains. But for consortium blockchains, every participant needs permission to access.
How does blockchain work?
Blockchain networks collect and manage information without altering any part of the data. When a transaction takes place, the database considers it a block. The transaction stands here as the movement of an asset, which is sometimes tangible and sometimes intangible. Once a block is created, it is linked with the previous similar block and as a result, a chain is formed. A chain has all the required information. In the end, data blocks are converted into unchangeable chains and it protects the information from any kind of alteration. So, this system is impossible to temper and that makes it unique and revolutionary for the users.
Use of blockchain in the real estate business
Real estate investors and agents prefer to use blockchain technology for various reasons. But the most attractive reason is the secure collection of data related to title transfer and price negotiations. This technology will be more common in the future because it saves unaltered information, which is important for the growth of every business.
Effect of tokenization on real estate assets
Tokenization is a new term in real estate so most people are not aware. It’s the process through which virtual tokens are created. These tokens represent ownership of assets. Tokens are digital but they represent physical assets and represent ownership of the real estate in different ways. They are flexible and digital transactions are possible through them. They can be compared to crowdfunding as well.
The process of Tokenization reduces the expenses related to the creation and issuance of assets. Moreover, with tokens, it is very easy to adjust assets according to the demands of investors. So. Tokenization is the solution to many real estate market problems.
Blockchain real estate companies
As mentioned earlier, blockchain technology has established itself in the Real estate market. Many companies are using this technology in the real estate business. Here we are mentioning a few prominent ones.
Republic: This company is listed in New York and it offers investment opportunities in the private sector. The company helps people to invest in real estate and gives them access to real estate, Start up, and crypto investment. Republic has generated more than $250 million in business in the real estate market.
SafeWire: Previously known as Safe Chain, this company is based in Columbus. It deals with challenges associated with wire fraud. It is one of the most common problems that real estate dealers face. Hackers intercept online transactions and create trouble for buyers and sellers. SafeWire ensures safe online transactions.
Vairt: This Ohio-based company provides services to those investors who want to invest in real estate as a secondary income source. They have developed tools to help their clients. Moreover, investors can sell property whenever they want.
RealIT: This is an international blockchain company, which offers services around the world. People from any country can invest in the US real estate market. Investors can buy tokenized properties, which ensure cash flow but low maintenance ownership.
ManageGo: This company is also based in New York. It’s for those investors, who own rental properties. It helps in processing payments and runs credit checks for them. For owners, it can check the background of potential renters. It improves the relationship between owner and tenant.
Security of blockchain real estate
Security is the major concern of every investor. Blockchain technology is 100% secure and legit too. Outside sources cannot alter data, as permission is required to access data. The information recorded in the system can never be destroyed. No one can delete this data once it’s properly stored. Moreover, there is no chance of hacking as well. The entire network is well protected.
So, we have explained the basics of blockchain technology and some companies that are providing different services based on this technology. Technology has brought a Revolution in the real estate business. There is no risk of data deletion or alteration. You can easily invest your money in real estate by using this technology. It will enable you to explore different markets and you will get the best return for your money.
If you’d like to talk more about property management, or you need help with Everest Property Management, please contact us at Everest Realty.