The latest buzzword in real estate technology is “DeFi smart contract,” the result of blockchain technology development. It has become an essential tool for real estate businesses to protect all parties involved in a legally binding agreement.
It also eliminates the need for intermediaries in corporate contracts, thereby increasing the efficiency of the entire transaction.
How intelligent is a “DeFi smart contract” according to this definition? What are the applications of this technology in the real world?
This blog will respond to each of these inquiries. Please read on for further instructions.
Benefits of DeFi smart contract in Real estate
1. Eliminates Middlemen
There are numerous intermediaries involved in a real estate transaction, including attorneys, brokers, and others, so it is not surprising that closing costs can run into thousands of dollars.
Involving many people when utilizing blockchain and DeFi smart contracts is unnecessary.
2. Automated calculations
With so many offices and individuals utilizing co-working spaces, it may take time to determine a property’s exact purpose. Here is where DeFi and Real Estate once again join forces. To avoid undercharging or overcharging, DeFi smart contracts can automatically compute usage and the resulting price for co-working space owners. This data-driven system could be incredibly useful for gaining future strategy insights.
Similarly, DeFi smart contracts development can automate real estate calculations to the letter, ensuring a level playing field for all parties involved.
3. Enhanced Usability
To invest in real estate, you must be able to afford a home, which may need to be within reach for many people. People are frequently deterred by the time and effort required for real estate investment.
Using blockchain technology offers individuals new opportunities. Parcel, for instance, enables you to invest in real estate in your preferred locations, allowing you to tailor your market exposure. DeFi smart contracts and synthetic assets facilitate this.
You are not required to own property to invest in your preferred communities; the amount of money you put down is entirely up to you.
4. Increased Transparency and Confidence
When all parties agree to the contract’s terms when triggered, a DeFi smart contract is created.
Once DeFi smart contracts are activated and implemented, they cannot be altered or manipulated because they are stored on the blockchain.
The immutability and transparency of blockchain make it impossible for anyone to alter data once it has been saved.
All transactions being visible on the blockchain increases the reliability of DeFi smart contracts.
5. Property tokenization
In 2020, real estate valued at $690 million was tokenized. This amount increased to $14.3 billion in 2021. Tokenize your properties to join one of the most exciting new movements in the real estate industry.
DeFi smart contracts in DeFi enable the tokenization of assets. Tokenization is comparable to holding a company’s stock. Tokens represent fractional ownership of any help, including exotic automobiles and real estate.
6. Paper-Free Business
In the traditional system for legal contracts, there is a high likelihood that the documents will be damaged, lost, or stolen. Therefore, it is preferable to store your important documents in a secure digital location where there is no possibility of a breach. Unlike traditional contracts, DeFi smart contracts are also economical and environmentally friendly. Thus, not only do you save money, but you also contribute to a worthy cause.
In the real estate industry, intelligent contracts were introduced many years ago. It has become a potent and valuable tool that has accelerated tedious manual document verification and processes. It has many benefits, including greater transparency in communication and transaction times, lower transaction costs, and increased security. According to global Blockchain market data, DeFi smart contracts have transformed this industry.
Also read: Top 10 dApp Development Companies Dubai
DeFi is already transforming how we use and perceive financial services, particularly in the real estate industry.
DeFi for real estate has numerous advantages over conventional banking. DeFi services are more transparent and powerful and employ cutting-edge technology compared to centralized banking systems. And when these benefits are applied to the real estate industry, flexibility and openness are increased for property owners, managers, and residents.