The integration of blockchain technology with the real-estate sector could bring a lot of benefits to the industry, including increased trust, enhanced loyalty, proficient data management, and access to real-time information.
Evolution of Web 3.0
Blockchain technology today needs no introduction whatsoever. It has revolutionized businesses across industries and emerged as the game-changer innovation for enhancing the trust and efficiency of companies among target markets.
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Among others, the real estate industry can derive immense benefits from the integration of blockchain technology. The open ledger can influence a variety of parameters of the real estate industry including property search, ownership issues, management of data, and securing transactions. Following are the top five potential ways through which blockchain technology can transform the real estate industry:
1. Smart contract revolution
Smart contracts can be defined as fully automated contracts that are self-executed when certain predetermined conditions are met. These contracts are written with specific instructions embedded in their codes and when these terms are met, the instructions are executed without any manual intervention.
Smart contracts can automatically record and execute processes related to a number of aspects of real estate, especially related to the transactions and payments between participating stakeholders. Some of the significant benefits of smart contracts include time and money savings, fully secured and fast transactions, and middleman elimination.
2. NFTs registry
Just like NFTs represent the ownership of a specific person in the domain of art, music, entertainment, and other fields, these digital assets can also be used for claiming the ownership of real estate assets. Tokenization of real estate using blockchain technology, properties can be converted into digital tokens and owners can preserve their ownership in the form of NFT. The concept of NFT can also help in dividing large real estate assets into smaller units; thereby leading the way for investors to gain fractional ownership of physical assets.
Benefits of NFTs registry:
- Enhanced Security and transparency
- Improve liquidity and fractional ownership
- Reduced transaction cost
3. Transparent & Responsible System
Blockchain Technology has carved its place owing to its incredibly transparent decentralized system. Every stakeholder who is part of the blockchain system has access to the information contained on the open ledger network.
This open accessibility to the data is one of the distinguishing characteristics of blockchain and comes in handy in ensuring the transparency of the system. In the real estate sector too, this transparency factor can work wonders and help the industry to achieve double-digit growth in the future. By integrating blockchain technology with the real-estate sector could certify its credentials of being objective, just, and completely transparent in its practices.
4. Efficient data management
Not only does the blockchain allow the accessibility of data across ecosystems, but it also makes sure that this accessibility is offered on a real-time basis. The changes in the data are constantly updated across the blockchain, thereby allowing the stakeholders to have access to the latest information as and when it’s added to the network.
Real-time access to data can really prove crucial in enhancing the performance of the company while reassuring the market participants about the reliability and authenticity of the information. This also reduces the cost of acquiring the latest data significantly and brings more savings to both industry players and prospective buyers.
5. Real-time accounting
The benefits of having access to updated information on cash flows. property ownership and transactions manifest in the form of real-time accounting. Real estate organizations can use the blockchain feature to accomplish real-time accounts in a fully automated manner.
This means accounting records can be made available to the participating stakeholders on a real-time basis. This, in turn, will further enhance the transparency and trust factor associated with the real estate industry. Also, this real-time accounting saves a lot of time and money and reduces the dependence of the industry on manual interventions for greater operational efficiency and procedural effectiveness.
Blog Credits: Times of India