With around 1,500 cryptocurrencies, over 200 exchanges, and around 20 million people who own Bitcoin; there is no doubt that cryptocurrencies are here to stay. So how will this affect the $217 Trillion real estate market? There are many ways that the new cryptocurrencies and the blockchain technology behind will affect the real estate market.
Cryptocurrencies are functional in real estate.
One of the biggest reasons that people do not invest in real estate is cost. Real estate is expensive, with the average house in America costing around $323,000. This means that the average family cannot afford to invest in real estate alone. Real estate investment firms make it easier by allowing groups of people to invest at a lower rate. Still, the cost is high and if it is a lower cost buy-in then it is probably riskier. ICOs (Initial coin offerings) are creating a new way for people to invest in assets.
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Asset-backed ICOs do not necessarily give someone a part of the asset, but instead, give the investor something that they can liquefy or spend right away. The token is often tied to the value of the asset and can go up in value. Think crowdfunding, but you get a token that you can trade or spend. This is also less risky for the investors as the investor isn’t part of the company or project directly.
Atlant is a new platform that is making it easier for people to invest, trade, and rent real estate using cryptocurrencies. This is a perfect example of how cryptocurrencies are becoming usable in real life.
Cryptocurrencies could eventually be used for people to invest in mortgages and potentially create a new type of mortgage. Instead of relying on the banks, people would be able to invest in mortgages using cryptocurrencies. This would create more competition for banks and also lower interest rates. It would also protect investors as they would have the ability to hold/sell the token at any moment.
Cryptocurrencies are great for large purchases. They are secure, transparent, and you cannot edit a transaction. These benefits are perfect for the ever complex real estate market.
Blockchain has a home in real estate.
The technology behind these new cryptocurrencies is very powerful. Real estate has lots of moving parts and can be very complex. A real estate transaction could take up to a year or even longer due to the complicated process.
Blockchain has the ability to create platforms that can solve these problems. Smart contracts will prove to be extremely useful in the real estate world. One company that is already using blockchain in the rental scene is Shelterzoom a new platform that makes real estate transactions more secure, transparent, and faster.
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Attorneys, realtors, federal law, state law, buyers, and investors; all create a complex process. This process has a lot of room for human error or some fudging along the way. The greatest benefit to the blockchain is that it is secure from A to Z meaning that once something is put into place, it cannot be edited. It also leaves a ledger in case someone might have to go back. This is excellent for the process of purchasing real estate and for real estate investment.
Being a landlord is incredibly time-consuming. Managing vacancies, payments, security deposits, and maintenance management are all different things that are on a landlord’s mind. Software that helps just one of these problems can cost a small fortune. Blockchain has the ability to manage everything under one roof.
The fact that blockchain is decentralized should mean a lot. Especially to those who understand the concept of APIs and Integrated apps. Blockchain is much faster than the average software application and does so without compromising security. Thanks to the structure of blockchain (so-called nodes) the access to the information and its storage is faster than using centralized databases.
Smart Tenacy is using smart contracts to make the relationships between landlords, tenants, and contractors more secure. They are also using blockchain to link into bond accounts.
UbitQuity the first blockchain secured platform for real estate bookkeeping, claims blockchain will save an estimated $4 billion by reducing human error, $550 million in annual US claim/legal savings, and $3 billion in US cost savings (according to Goldman Sachs Report). These are some pretty large numbers.
It is worth the investment.
Cheap is expensive and expensive is cheap. This is a saying that I grew up with. It means that if you cut corners now, then you will pay for them later. Blockchain is new and like most new things it has brought unlimited possibilities. Investing in blockchain software or using finding a place for a token in your real estate company today could save you millions a year from now. Time is the asset that we cannot gain more of. Blockchain will save your company time and hard-earned capital.
Cryptocurrencies and tokens are changing our world. They are changing how we invest, and how we think of money. They are tokenizing everything and challenging the current system. There is no doubt that we will see a new world for investments, mortgages, and fundraising open up in the next two years.
Your job is to run your company and our job is to provide you with the software solutions to do so. While you are searching for your blockchain solutions, talk with a trusted expert. Know if you need a custom solution or if there is a software solution already out there. Allow an expert to explain the pros and cons of both. Find a true partner… not a salesman. You want to make sure that your best interest is in their mind. Our business is your business, that is why our consulting is free. Call or email us today and learn how blockchain can help your industry. Consulting is absolutely free.
Now is the time to invest in real estate, now is the time to invest in blockchain. There is no better time to get started, than at the beginning. We saw this with social media advertising which is rising in cost. Those who were, in the beginning, are winning.
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