Will blockchain technology change the future of the Real Estate Industry in Malaysia?

Updated: Feb 19

In Malaysia and many other countries Real Estate property records are notoriously flawed. They contain mistakes, omissions, and are prone to fraud.

Blockchain which has proven effective in several industries as a disruptive technology that provides transparency, efficiency and privacy along a peer-to-peer network, can it do the same for the real estate industry? Some of the benefits of using blockchain technology in real estate are listed below.

In the real estate industry, blockchain can improve access to data, enhance security, lower costs and remove fraud. It can create a decentralized, shared and distributed ledger that significantly reduces the ability to misuse such records, and significantly increases data integrity and ease of access.

A shared ledger on a blockchain can improve the recording of a title or land claims, mortgages, liens, or even the nitty gritty details like colour of paint etc. which will be a challenge for fraudsters. Blockchain can completely revolutionize the way we record all aspects of real estate and real estate related transactions.

Once a transaction is recorded on a blockchain information, it becomes impossible to change or edit. It’s this component of blockchain technology that would reduce the risk of fraud and falsification of documents for transactions between landlords, tenants and relevant third parties. On a blockchain, every part of a lease or sale agreement would be automated, and payments would be received instantly–even outside of business hours.

Towards a seamless transactions on a decentralized marketplace.

The current centralized marketplace that utilizes a central authority, like a bank, is costly to operate in and is prone to business and political pressures. For transactions to occur in the real estate market, one of the largest centralized marketplaces, banks and often real estate firms are needed to confirm a transaction.

But a decentralized marketplace that can exist on a blockchain, provides buyers and sellers more access to data and better security. The power could very well go back into the hands of buyers and sellers even for small players with the adoption of blockchain technology and a decentralized marketplace.

The external real estate marketplace is fast changing and it is a matter of time we will need to keep up with the change too.

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