In the simplest terms, blockchain is the ability to remotely share databases and processes, making them more centralized and accessible. For the real estate industry specifically, this could transform the industry by making it more modern and efficient.
One such way is accessing the MLS Property Data system. Every real estate transaction goes through the MLS service which tracks agents, clients, contracts, listing agreements, appraisals, etc. Unfortunately the information on the MLS is often decentralized and restricted, and it’s often out of date.
Blockchain technology can be used to overcome these barriers. By providing a way to securely share data, the blockchain makes a shared, nationwide database possible, one that offers real-time access to property information straight from the source and enables a more holistic view. It also opens up more opportunities for collaboration among players in the real estate industry.
The blockchain can also provide a central title database for the entire country to securely store and instantly access historical title records, allowing for the streamlining of title transfer in a property sale.
Another very important area that the blockchain will effect is the efficiency and security of transactions. Each user has a unique identity on the blockchain via cryptography, which means consumer financial information can be shared securely with other parties during transactions. One person can send funds to another person that won’t release until the transaction is formally completed. This adds a layer of security that speeds up the transaction management process regardless of whether the buyer and seller are in the same place.
Blockchain technology streamlines the real estate process by enabling people to securely and efficiently share data and money. It makes information more accessible, cuts out the middlemen, and reduces the risks of fraud and theft. Currently only a couple states are experimenting with this technology with a few more slated to give it a try. Could Maine be far behind? We’ll have to wait and see. (see the below infographic for a visual explanation of how blockchain works)