As the hype continues to build around Blockchain, Bitcoins and other related technologies- for many real estate professionals, this is a part of a brave, new, confusing world of technology. Like the original internet, the blockchain is a revolution in technology that will touch all people and all businesses. So people are paying attention, but many still don’t understand what the blockchain is.
Bitcoin for example, is one way to transfer money without a bank or other third party. There no physical coin, however; it’s not like a subway token. It’s a digital asset, assured by the blockchain. Interestingly enough, when people buy homes with bitcoin, they really are still buying with cash. It’s just being converted to bitcoin first. So, the next time you read about a bitcoin home sale, it is generally still a traditional cash sale.
Coming to the real estate segment, blockchain technology has the potential to change the current style of operations. In the near future, it may be possible for a home-buyer to buy a home and complete the sale (along with escrow and title insurance) by clicking on a shopping cart on a website. The blockchain will ensure that the buyer gets the title or deed and the seller gets the cash (via a cryptocurrency). The blockchain will also record the title or deed to the appropriate public records, such as a county in the United States or similar.
Real estate professionals will continue to thrive in the era of the blockchain. The advice, knowledge and hand-holding of real estate professionals will always be an important part of a buyer or seller’s process. However, the handling of money and transactions will inevitably change, and that change is already underway. Brokerages will need to adapt their business models to understand and enable smart transactions but otherwise will continue to thrive in the era of the blockchain.