Real estate is one of the industries that have been significantly impacted by technological change throughout the world. The real estate sector has recognized the potential and impact of technological advancements. Having said that, it is seen that blockchain technology in real estate is getting popular by leaps and bounds.
Blockchain has been gaining traction all over the world for all the right reasons. It is making its way to the Pakistani market as well. If we explore the untapped potential of this technology, we can entirely transform the real estate sector of Pakistan.
Real estate investments are generally seen as more profitable because people equate land and property owners with a slew of positive socioeconomic markers of prosperity. New technological breakthroughs indicate the world’s progress, bringing great significance to what we do and how we view things.
‘Blockchain’ is one of the disruptive technologies whose full impact has yet to be determined; nonetheless, it is expected that blockchain technology will play a significant role in the transformation of many businesses, sectors, and business transactions.
People’s understanding of blockchain technology and its uses is quite limited, yet, on the bright side, people have begun to discuss the concept’s applications.
Graana.com explains how Blockchain can help the Real Estate sector of Pakistan in detail.
Blockchain in Real Estate – A Pakistani Context
The Pakistani real estate market has been a laggard in adopting technologies. Blockchain technology has been a concept new to the market but is gaining traction due to the wide array of its applications. Purchasing and selling property in Pakistan is fraught with difficulties, ranging from a lack of information, fraudulent schemes, and lack of transparency.
Because the technology is based on a secure and decentralized system that can be used to manage transactions, property details, and client profiles, it has a vast potential to positively impact the real estate industry. The purchasing and selling of real estate entail multiple steps, which blockchain can help track.
It can prevent long-standing land ownership disputes by decentralizing the process and digitizing it entirely.
It can help the Pakistani real estate industry in the following segments:
Providing accurate information
Market analysis and investment plans are areas only real estate professionals have the expertise to; thus in most circumstances, a high level of trust is required. This has frequently resulted in fraud and manipulation when there is a gap between knowledge and authentic information, especially for international clients.
When it comes to making judgments concerning the sale and purchase of a home, information is highly useful. In the real estate industry, incomplete information or non-disclosure of facts is the leading source of fraud and mistrust.
In Pakistan, getting access to reliable information is difficult since land records are not digitized and hence readily manipulated.
That is to say, implementing a secure and transparent digital land record management system will benefit real estate purchasers, sellers, and investors.
Blockchain helps to keep a transparent and decentralized record. The record can not be changed or tampered. It helps prevent fraudulent schemes. Around 70 % of cases in court are related to land ownership and acquisition in Pakistan, which take decades to resolve.
Such a record system can completely eradicate the prevalence of long withstanding disputes.
Because of the decentralized structure, all transactions may be examined in real-time by running a personal node or using blockchain explorers. Every node has its own copy of the chain, which is updated regularly as new blocks are added.
This enables users to follow a transaction journey throughout and fight back any discrepancies.
Transaction Data Collection
Blockchain explorers have access to all information related to a transaction on the blockchain. In the realm of cryptocurrencies, every transaction is recorded on a blockchain, which is a distributed ledger that makes information worldwide accessible in real-time.
The structure of the data on a blockchain differs from that of a traditional database. A blockchain organizes data into groupings called blocks, each of which contains a collection of data. Blocks have specific storage capabilities, and when they’re full, they’re closed and linked to the preceding block, producing a data chain known as the blockchain.
All additional data that comes after that newly added block is assembled into a new block.
Contracts are frequently written in legal language and are difficult to comprehend for those who are not familiar with the technical jargon. There are also other clauses that exempt real estate developers from liabilities.
Furthermore, contracts take a long time to prepare and must be rechecked numerous times before all agreeing parties sign them.
This makes the sale and buying procedure extremely time-consuming and inconvenient. Blockchain expedites the process and makes the acquisition and transfers in a few minutes.
No middle person
There is no need for a mediator. Reduced costs by eliminating third-party verification and improved accuracy by removing human involvement in verification are also made possible through this. Decentralization makes it more difficult to tamper with data.
The settlement of transactions made through a central authority can take many days. Blockchain allows transactions to be completed securely in a very short time – especially cross-border trades, which take substantially longer. Factors like time zone differences and payment processing delays take longer if we take the conventional approach.
Blockchain is finally gaining a reputation for itself with many practical uses for the technology already being implemented and researched. Blockchain, which has become a buzzword on the lips of every investor in the country, promises to make corporate and government operations more precise, efficient, secure, and cost-effective by eliminating middlemen.
The question is no longer whether older organizations will adopt the technology, but rather a necessity. The next few decades will be a critical phase for blockchain development. It will completely reshape the structure of the Pakistani real estate market.