8october
2017

Blockchain technology as a new impulse in the development of the real-estate market


Over the past few years, Blockchain technology has burst into our lives. And no matter, whether we like it or not, but the future world progress will somehow be connected with this technology. Blockchain penetrates into all spheres of our life slowly, but confidently, including the real-estate market. In many respects such a motive force this technology has obtained due to the popularity of crypto-currencies, around which increased information turmoil over the past year and a half has been created. A very important and perhaps even a decisive factor in such a rush is an apparent impetus in the development and improvement of the technology itself, and in the gradual consolidation of the concept of "crypto-currency" in association with a valuable asset.

The ability to create new payment systems and shift transactions to a previously inaccessible level of security and transparency on the basis of Blockchain technology, unveils wide prospects for the use of this technology in the real-estate market, especially international one. Does the market need changes?

As we all remember, the crisis of 2007-2008 showed that the connection between the real-estate market and the financial world is much closer than it seemed at first. For the proper functioning of any state economy we need clear and transparent rules for the development, promotion and regulation of markets, especially real-estate one. And despite many years of hard work for the development of national and international legal framework for working with real-estate, at the moment there are no generally accepted rules allowing to provide a single direction in the development and stimulation of the market.

As a proof, it is possible to cite the fact that in 2010 the UN Board of Experts from different countries on work with real-estate developed general recommendations, according to which the basic principles and directions of the development of the market and its advantages were determined. Despite the past 7 years, some sets of principles on the approach to the real-estate market due to various circumstances have not yet been accepted by an absolute number of countries in the world.

It means that the particularity of this sphere is so deep that it requires an even deeper analysis and involvement of specialists.

And here new technologies and Blockchain in particular, can become the very solution that will create an international oasis for working with the real-estate market, where each participant of this huge community can influence the formation of the rules of the system.

What are the real advantages, why does this technology have such an interest in society? And what are the advantages for real-estate? I think one of the main advantages is the reduction in resource and time costs that are inherent to traditional systems at the moment. Today, the huge number of documents that need to be collected and transaction costs hamper the development of the market and do not allow to realize its potential in a full degree. The implementation of Blockchain technology can help to develop the necessary set of general rules for working with real estate.

Thus, for example, it is possible to build a single transparent system to estimate the value, specify and minimize investment risks, provide a fast and secure way of transferring proprietary rights and much more. Of course, it will require professional development of future market specialists, because they have to become a "gateway" between the legal systems of different countries. At the moment, the use of Blockchain can become a reliable way to solve sectoral problems, create a large community of all market participants within a single information space and their super-efficient interaction.

It goes without saying, it is a time-taking process, but Rome wasn’t built in a day.

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