Proptech continues to redefine the way that properties are searched for, bought, sold and rented out. People can search for properties online, visit them virtually or via video, negotiate prices, draw up contracts and seal deals using their computers or smartphone apps. Trends in the past couple of years have included apps to organise your home to make it more energy-efficient and secure. You can tell an app to switch the heating and lighting on or off, turn on the oven or play music. Proptech has also made it easier to search for better loan deals, rent out properties at short notice, or get an advance on your property’s valuation to speed up the process of buying your next home. However, there are still some processes which are paper-based, time-consuming and relatively costly. But blockchain technology could be used to cut through this.
Blockchain is the technology behind cryptocurrencies. Fundamentally, it is an online and digitalised ledger to record and manage any transactions. Basically, block chain is a block of chains. A block is the record of new transactions and once each block is completed, it is added to the chain. It acts like a public ledger, which is publically shared and decentralised. This technology could be used to break down even more boundaries in the property world. For instance, it could be used to shake up how properties are searched for. Data concerning property at the moment is fragmented, incomplete or even incorrect. A centralised blockchain multiple listing system could enable data to be shared across a network. This data would be decentralised and securely exchanged between all real estate professionals connected to the network. This blockchain approach can streamline the whole process of buying, renting and managing property.
Using blockchain technology, it is possible to streamline processes, reduce the risk of fraud and cut costs and middlemen. Landlords, sellers, brokers and lawyers would all have access to the information regarding a specific property, along with the property market as a whole. Currently, this data is entered in many different places and at different times, which makes it harder to manage and to prevent mistakes. Through blockchain, all information about a property, its previous owners, including inspections, records and landlord information could be fully disclosed. This would cut out the number of people involved in the administrative process and cut down on paperwork.
Smart contracts could also be created which identify, hold and transfer properties using digital encryption. These contracts would cut out the need for middlemen such as banks and lawyers, and instead, transactions could be validated using digital encryption. Smart tenancy contracts could be set up which enable transparency over the terms of the lease, contract and any other transactions. At the moment, Sweden is testing how it keeps records of property transactions using blockchain-based technology, via its land registry authority. It is estimated that this could save millions of pounds of taxpayers money by cutting down paperwork, eliminating fraud and allowing for secure transactions.
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