Blockchain Technologies Used For Fraud Prevention And Gaining Ground In Real Estate

With the real estate market growing each passing day, it has become crucial to eradicating the hurdles coming in the way of the real estate industry. The market is gradually shifting towards blockchain technology to bring transparency and accuracy in its operations.

The blockchain is a series of the distributed ledger which contains a huge amount of transaction data, known as blocks that are linked to each other using cryptography. It is generally used to store and secure data permanently.

Real estate market has many loopholes such as:

• The presence of intermediaries makes the whole process expensive and increase the chances of fraud.
• Frauds such as title frauds and online scams are growing continuously due to lack of document verification.
• The transaction costs here soar high which in turn makes it difficult to convert it into a profit. Also, the amount of corruption and black money in this market is growing day by day.

Blockchain helps in compensating for these loopholes and make the process efficient and effective in many ways.

Earlier, the records were maintained manually and were stored in registers which had a lot of problems such as the records were prone to tampering, anyone could steal those registers and alter the records and a lot more. By using blockchain, the security in the transactions can be maintained efficiently due to its decentralized nature. It also makes it possible to record the data and important records online which eliminate any fear of the records getting altered or the data being damaged by wear and tear.

The tampering with the documents can be prevented completely due to the presence of a unique digital fingerprint present in the blockchain, known as a hash. The cryptographic hash functions eliminate the chances of data being tampered with as and when the data moves inside a block.

The issue of “double spending” is also resolved by blockchain as there cannot be multiple copies of a single registry with someone. This helps in reducing various frauds and increasing transparency.

Blockchain also cut the time spent in recording a transaction as the records are recorded and maintained electronically. It also helps in reducing the costs of printing, scanning of data and helps the process to be done at a much faster pace.

As the records are being made electronically, the chances of mistakes and miscommunication are reduced drastically which was a big hurdle when data was recorded manually. It increases the level of accuracy in recording and maintaining the data.

It also eliminates intermediaries from the market by allowing buyers and sellers to interact directly. It  makes the process a lot easier by providing property verification means. The technology makes it possible to eradicate black money from the market by making the records traceable, transparent and more secured.

Blockchain has changed the way real estate industry works and has provided various benefits to the users, making the records accessible. The frauds are prevented efficiently by providing a way to authenticate documents and adding each record to the blockchain as and when the documents are transferred or sold.

As various unnecessary costs are cut by blockchain, the whole transaction cost also comes down. The buyers can also avoid paying the bank fee by doing the transactions using cryptocurrency. It makes things easy for both the sellers and the buyers by offering smart contracts which can be altered according to users’ needs without the need of human verification, cutting a lot of time. As these contracts are executed automatically, it reduces the chances of errors occurring.

As the ledgers are open and distributed, the information can be exchanged in no time and without putting much efforts and helps in building the trust of the users due to its seamless accessibility. As blockchain doesn’t involve any paperwork, the efforts are reduced in this aspect too.

There are various mechanisms present which do all the work of making the transaction seamless and accurate. The mechanisms include Proof Of Stake, Proof Of Work etc.

The land title documentation on blockchain prevents falsification of documents. Its property ownership records are very well recorded and maintained. Also, the mortgage is perfectly streamlined by allowing a direct lending platform without any brokers or layers involved in the market and increasing the participation in the mortgage market. It can also contribute in a huge way to prevent corruption in the real estate industry by preventing data modification and allowing the data to be more transparent and prevents people to hold property in a false name or someone else’s name.

It is necessary to be open to innovations and adopt a technology like a blockchain to build a level of trust and have a competitive edge in a market where there are various options available to the users if they do not like one. The whole real estate market is shifting towards this as blockchain helps in reducing, rather than eliminating the loopholes, this market has.

The blockchain is spread over various markets, real estate being one of them and this technology can certainly be called the future of real estate. It has surely opened new ways of operating this market and offered various opportunities to provide accuracy in the transactions being done. It can transform the economy in many ways if used effectively. It can change the way transactions are done with proper security being an add on. The process starting from the land registry to making the final payment, everything is being closely looked at to make innovations in the technology as and when needed.

The technology is yet to be fully discovered and organizations are finding and exploring new ways of making blockchain work in various markets and open new horizons of opportunities. It surely has the ability to bolster economic growth by continuous discovery and innovation taking place in this technology. It is still in its early stages, the innovations and facts are being introduced every now and then which clearly shows the potential it holds to grow and prosper the markets in the future.