You’ve likely been hearing a lot about blockchain technology recently, and for good reason. Blockchain and its smart contracts are revolutionizing the real estate industry in many ways. For those wondering what real estate block chain is all about and how it can benefit their businesses, read on for an overview of what blockchain is, how you can leverage the technology, and the top blockchain platforms to consider exploring.
Find It Fast
What is real estate block chain?
So what is blockchain, anyway? Blockchain (sometimes written as block chain) is a decentralized database that keeps its records, or blocks, on a public ledger system that includes everyone on the network. It’s perhaps most famously applied in digital currency like bitcoin, which has changed traditional centralized methods of sharing information and keeping currency into a broadly distributed network of information that cannot be edited or destroyed.
What is block chain tokenization?
Tokenization refers to the process of turning physical assets into digital assets, also known as non-fungible tokens (NFTs). These NFTs represent physical ownership of an item and allow real estate transactions to be digitized and simplified in the process.
Blockchain for real estate
Real estate blockchain is the process of applying the core process of block chain technology to real estate investing and transactions. Because information cannot be altered, it presents an easy way to create a single truth that can help with anything from title transfers to price negotiations and, of course, the property transaction itself. Especially in commercial real estate, the process carries potentially immense possibilities.
What are real estate smart contracts?
Blockchain-based smart contracts are contracts held in the distributed ledger of the blockchain. They’re paperless, digital documents created with the mutual agreements of all parties. Activities like submitting closing documents will trigger an action in the smart contract that can be taken care of immediately. This removes intermediaries and speeds up the timeline of any real estate transactions.
Benefits of using block chain in real estate
One of the biggest advantages of real estate blockchain is that transactions are automated. Contracts can execute automatically and instantly, driving speed in real estate investments. Being able to automate the process of buying real estate can save time and money, all while increasing security.
Block chain technology also provides these benefits:
- Removing intermediaries and increasing trust and credibility among all parties (by storing documents in a distributed, non-disrupted environment)
- Allowing investment opportunities to be more easily researched and acted on (by minimizing physical barriers through the digitization of assets)
- Making title management more transparent, intuitive, and cheaper
- Making the entire transaction process more efficient (by taking less time from due diligence to the final transaction)
Disadvantages of real estate block chain
Make no mistake: real estate block chain is still a maturing technology, which means there are some limitations.
Many companies are trying to jump on the blockchain train, so you’ve got to do your research to find a reliable partner (see our list of recommendations below). Additionally, data cannot be easily modified once it is recorded, making it difficult to adjust contracts. Finally, the complexities of the real estate market and the multiple parties involved are not always prepared for the disruption this technology brings.
While blockchain offers a lot of benefits, it’s clear that some processes will need to remain manual until decentralized manual databases and systems have caught up.
Is real estate block chain secure?
Blockchain technology is inherently secure, which is especially important in this industry. In fact, we’ve seen brokerages and other businesses use blockchain specifically to increase security in their transactions. Because the distributed ledger creates a single, unchangeable source of truth, and because that information is not centrally hosted, transactions are protected from data tampering or potential fraud. This makes blockchain transactions more secure than traditional methods.
Real estate block chain companies to know
To fully take advantage of the technology’s benefit, you need the right blockchain platform. These 19 real estate blockchain companies are disrupting the industry and are well worth a look.
Republic is a trading platform designed for multiple types of investments, including real estate opportunities. Users can invest in a wide range of private property opportunities through the platform’s blockchain technology.
ClosingLock (Formerly SafeWire)
Built to address wire fraud challenges, ClosingLock secures transactions using blockchain. It’s designed to protect real estate buyers, sellers, and firms.
As a dedicated real estate investment platform, Vairt offers the ability for fractional investment without long-term commitment. Advanced data help potential investors find properties that are most likely to gain value over time.
RealT uses tokenization for fractional investments in real estate property. Investors around the globe can buy digital tokens representing partial ownership in properties, which can turn a profit over time.
Based in New York City, PropertyClub uses blockchain to improve the real estate buying experience. All of its transactions are digital, using smart contracts to expedite the experience and leveraging cryptocurrencies instead of working with traditional financial institutions.
Property owners and landlords can use ManageGo to manage renter relationships. The platform uses blockchain technology to process and manage payments, run credit checks, and more.
RealBlocks is not the typical online marketplace for real estate. Instead, its tokenization process speeds up and secures transactions, reduces fees, and improves liquidity for investors.
SMARTRealty has built its business model on smart contracts. By providing templates and process automation, it speeds up transactions for everyone involved.
Powered by Web3 technology, Propy uses smart contracts to help buyers and sellers conduct transactions using cryptocurrencies or NFTs. Transactions become faster, more secure, and more intuitive.
As ShelterZoom’s document management system, DocuWalk ensures security through a blockchain-based storage system. The financial records and tracks it creates become the single source of truth for everything involved in the transaction.
If you’re looking for more secure real estate transactions, StreetWire has you covered. Beyond that, the platform acts as a hub for everything connected to property investment, thanks to a continuous live stream of relevant data and information.
Short for Cypro Properties, CPROP is a comprehensive blockchain platform that can handle investment management, property developing, property and investment insurance, brokerage transactions, and more.
As a consulting firm, Crypto Realty Group works with investors and other stakeholders interested in diving into blockchain. The company aims to become your partner in buying and selling property and leveraging all the benefits of real estate block chain technology.
While many online marketplaces sell tokenized real estate, Blocksquare helps you actually create those tokens to sell. You can use Blocksquare’s solutions and APIs to digitize the value of real estate properties, launch investment platforms, and connect people to tokenized real estate deals online.
Owny (Formerly RealtyBits)
Owny creates an infrastructure around your digitally-owned property and real estate tokens. Once you’ve built a portfolio, you can use the platform to onboard investors, meet compliance goals, and make your portfolio management more efficient.
With Figure’s blockchain financial services, personal and commercial real estate investors can establish cryptocurrency-based mortgages. The platform’s digital investor marketplace also offers tokenized properties for sale.
Ubitquity is perhaps the most comprehensive real estate blockchain platform on the market. Use it to tokenize properties, conduct digital transactions, establish smart contracts, manage escrow payments, and more.
The Bee Token is a blockchain-based, decentralized rental marketplace and cryptocurrency designed to keep short-term rental agreements and transactions simple and secure.
Harbor is not dedicated to real estate, but its functions can have a massive impact on the industry. It helps investors establish compliance, enabling the tokenization of real estate properties while also offering an investor portal.
The future of real estate in the age of blockchain
It appears that blockchain is here to stay—and knowing how to use it can be crucial to growing your business.
Luxury Presence is not a blockchain company looking to jump on the growing buzz. Instead, we’re here to make sure that your website and marketing efforts keep up with ever-changing technology and help you stand out from the competition. We can even help position you as a digital expert by highlighting how and why you use blockchain, should you decide to adopt the technology.
To learn how Luxury Presence can help you stay ahead of industry trends and grow your real estate business, get started today.