Blockchain To Eliminate Intermediaries and Prevent Land Fraud
Blockchain technology in real estate can improve to bring more secure land registry procedures and restrict land fraud. The land registry process is complicated and inefficacious in many countries across the globe, which is one of the causes that cause an inability in real estate services.
One of the vital issues that are caused due to the carelessness of land registration is property fraud. There are several ways through which a person can become a sufferer of real estate fraud. For example, it is usual nowadays to take ownership of land either through bribery or some other unlawful practices.
Once the land is acquired, then a company or person who bought the land can build any real estate property like a home or farm on it and register the land on their name. Most of the potential ways for real estate fraud are a result of inappropriate and insecure land registry.
Everyone who is even partly correlated to technology would know that blockchain can support increase data security. Still, here, the question arises of how blockchain in real estate can help to prevent land fraud.
Two of the main hurdles presently witnessed in the land registry process are the involvement of agents or broker and time delays. Agents or broker who acts as the agent between the buyer and government can be exposed to bribery and may sell the same piece of land to two people.
The land registry process is a time-consuming process that includes the verification of many documents. Many legal problems might occur during land registration that can cause time delay. With an expanded gap between the selling of land and it’s title registration, the risks of fraud increases as well. But, blockchain technology can discuss the challenges of the land registry process.
There are only a few people who directly buy property as the process is hindered due to administrative issues. But, by automating verified transactions, smart contracts can make the process much easy and fast. With a blockchain platform, anyone can create a decentralized ID to sell or buy a property.
Utilizing a decentralized ID would make ownership transfer seamless. As soon as the registrar would transfer the land to buyers’ names, the smart contracts would trigger to update the transaction on the blockchain database accordingly. Hence, blockchain will reduce the need for Agents and make the land registry process transparent.
Secured Land Papers
If someone can take a printer and print currency, then the value of the money will reduce by a considerable amount. The same goes for confidential documents like property papers. It should not be possible for a person to have two land ownership document copies of the same land but with different details.
Blockchain has the potential to address this challenge in real estate, as is evident from the non-duplicability of cryptocurrency. A person cannot spend the same bitcoin for more than one transaction.
Blockchain, with other technologies like AI, has the potential to protect the land management systems. The application of blockchain in real estate will enable the democratization of properties. If executed properly, the marriage of blockchain technology with the real estate industry will open up the gate for more potential investors to try their hand at real-estate investments.