In an ever-developing world that is constantly changing and evolving in the Fourth Industrial Revolution, some industries still lag behind in their innovation. One of these industries is real estate, as realtors, brokers, and title agencies all continue their operations today largely as they have for the past few decades. However, Blockchain technologies are one source of disruption that may finally force real estate as an industry to adapt to the times.
Currently, one area within real estate that is especially liable to be disrupted is titling. The de facto method for changing the legal possession status of properties is for a buyer or seller of a home to go down to the local courthouse, sift through binders of deeds that are feet thick and have records dating back decades, and once the deed is found physically erase the previous owner and replace their name with the new owner. This is very inefficient for a multitude of reasons. Although this process could be digitalized in a variety of ways, many companies are actively striving towards a blockchain based solution.
In multiple countries abroad including Sweden, as well as Vermont and Wyoming here in the United States, local, county and state governments are exploring the possibility of using public blockchain ledgers to host title records. Essentially, once these title records are uploaded to the blockchain any person interested in finding title and property records will be able to do so instantaneously by combing through the blockchain, This solution will eliminate the need for the endless stream of paper documents that are still in use despite being outdated for years.
Given that real estate is an industry which will never disappear because of the universal need for housing and safety, the implications of this blockchain disruption will be widespread. There is a possibility that real estate agents may be eliminated altogether if the entire home sale transaction process can be placed on the blockchain. Furthermore, countless other jobs that were previously human facing and based entirely upon person to person interaction may be eliminated. The relationship between Blockchain and its increasing and imminent presence in the real estate industry is an extremely interesting example of how even the industries most resistant to technological integration are beginning to change. Only time will tell exactly how this will affect our society, but it is certain that many lives will be altered forever.
Questions to ponder:
1. At what point does technical innovation do more harm to peoples' lives compared to the value it creates?
2. What other industries are like real estate in that they are heavily resistant to change and technology?
3. Is Blockchain technology really the next big thing that will change our world, or is it simply another step towards what comes next?
This is a super interesting article because it gives the perspective of an industry that is not privy to technological change. I think you do a good job of mentioning the current system within the real estate industry (titling through use of paper documents) and contrasting it with what could be a better solution (blockchain). I think your discussion could be stronger by adding what implications you think would come of this? How would this affect society as a whole? For good or worse off? Overall great post though.
ReplyDeleteVery interesting article. Doing some of my own research lately on blockchain technologies, it is amazing how many applications there are for the technology. Yes blockchain could cause a huge disruption in the current system and could cause some losses of jobs. However, the real estate industry needs to get up to speed with current technologies and practices like blockchain that can dramatically increase efficiency for all parties involved. As a business, blockchain would be worth the investment.
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