Can You Use a Real Estate Investment in the Blockchain?
The blockchain is creeping into every industry. Real estate investment is the latest to incorporate the blockchain. Read this guide and understand this trend.
If you thought cryptocurrency or bitcoin didn't have anything to do with buying a house; think again. 2018 marked the first year a U.S. deed was recorded using only blockchain systems.
A somewhat volatile, less regulated form of money, cryptocurrency has been making big waves lately. As it continues to come out of the shadows and into the mainstream conversation the real estate market could be changing.
Instead of transacting and recording the sale through traditional recording systems, the real estate agency used Ethereum instead. Unlike the typical face to face meetings that occur when a person buys or sells a property, this sale happened in a digital marketplace.
Want to know what this might mean for you or the future of real estate investment? Read on as we break down everything you need to know to understand blockchain and cryptocurrencies.
What Are Blockchains?
So what exactly are blockchains?
The easiest way to think of blockchains is by imagining your bank account. While the money you keep in your checking account isn't digital, the functionality is still similar. Blockchains act as digital ledgers for transactions where the receipts can be stored and shared with other users.
When it comes to blockchains, security is one of the main advantages. Because blockchains are stored across multiple computers, these electronic records are successfully encrypted. A user wouldn't be able to alter the data or currency associated with a transaction because so many other users are watching simultaneously.
By utilizing blockchains, users can buy, sell, and trade real estate in ways that previously weren't possible. By digitizing the buying and selling process, investors can trade real estate the same way brokers trade stocks.
While blockchains are typically associated with cryptocurrency (a fully digital form of money) this isn't always the case.
It's Not All Cryptocurrency
Cryptocurrency is certainly part of the conversation when blockchains come up, but they don't always have to be. In reality, the security of blockchains can still be used without cryptocurrency.
Imagine the idea of a mortgage. Without a high enough income or quality credit, the idea of investing in real estate may feel far-fetched. Blockchain technology allows investors to purchase a small amount of a property rather than paying for the entire thing up front.
By sharing the burden of the entire cost, more people are able to engage in real estate investment now than ever before. This options also allow investors the opportunity to share the responsibility of the property. If you aren't interested in property management, sharing the investment could be a smart way to share the upkeep as well.
Your Real Estate Investment Awaits
Whatever real estate deal you're interested in - Elite Team Realty has the experience you need to help you realize your dreams.
Whether you're in the market for your first home or want to learn more about investing in real estate for the future, our expert agents have over 20 years of experience to help you navigate it all.
Learn more about investing in real estate today!