How the Blockchain Technology Could Change Real Estate
by Joe Killinger
We are starting to hear more and more about blockchain technology within the real estate industry. This technology was originally built as a core component for bitcoin but is easily adaptable to the real estate industry. The technology is essentially a form of record keeping that allows you to store encrypted data that cannot be erased or altered and is extremely secure as well as being able to drastically cut down on the large number of documents currently used.
Probably the biggest impact will be seen in the escrow and title businesses as with the technology escrow companies could effectively be cut out by using blockchain. The proof of authenticity can be provided, verifications completed and documents can be placed directly into the system and title can be passed safely and securely from owner to owner. Parties involved in the transaction can also see a significant savings as the escrow and title companies’ fees will no longer be part of the transaction.
The rental business will also see a big impact by taking steps toward removing the threat of the scammers that prey on renters by taking property information that a landlord or agent has posted and reworking it and act as the agent for the property. Many scammers will request the deposit be made out to them, or sent to a third party that actually is part of the scam and be long gone before anyone realizes what just happened. Blockchain is an almost 100 percent incorruptible resource, senders and recipient of funds are logged, digital ownership certificates for properties are saved and are almost impossible to replicate and are directly linked to the property in the system, making it almost impossible for someone to have access to a property they do not own, thus making forged ownership documents and false listings a thing of the past.
Blockchain will allow you to create a digital ID for your asset as well as for the seller and buyer. Documents can flow directly to and from each other seamlessly and securely and eliminate the need for several people handling documents. Since you can minimize the group of people being involved you can potentially save time and money on each transaction.
Image: By deavmi (Own work) [CC BY-SA 4.0 (http://creativecommons.org/licenses/by-sa/4.0)], via Wikimedia Commons