There is a huge fragmentation in the real estate sector’s natural processes, from planning an asset for its construction to its final use.

Many actors are involved. Many small transactions are carried out. We can split the real estate long process into a lot of different parts.

Banks, public administration, real estate portals, associations (such as API), developers, lawyers, real estate agents, notaries, the land registry, and building renovators are just some of the actors that interact in the real estate world. They participate in processes as varied as appraisals, home search, planning, construction, works, ownership, contracts, services, mortgages, procedures, or the sale itself. Complicated, right?

Let’s also add that they do not share information and use their own software, acting as a silo. Making it difficult to reach all the info for clients and the interactions between themselves. There is not a clear protocol allowing obtaining information, thus increases the real estate process time.

If we would like to put together all this information in one place or one company, this would make it very powerful in a sector as fragmented and as important to society as real estate.

Is there a solution? Yes, Blockchain. Blockchain seems to be the perfect solution for our market to be more fluid and transparent.

Many times the blockchain has been explained to us as a “chain of blocks” (famous phrase) that nobody understood, but in this post, we are going to try to represent this “chain” in the real estate world.

Let’s suppose that the actors involved in a typical real estate process communicate in the same place, in the same network. Each party has a node, where each one manages its piece of the real estate chain, sharing information, making it progress in a fast and safe way, but being owners of their part of the process.

On this chain, many real estate parts could participate, in the future, from the administration to the managers and also the proptech startups that provide services to the different actors of the process, making complete processes.

Manage the information in a communication platform (not for storing documents) where questions are sent, and answers are obtained between the different actors in an automated and truthful way. It gives the processes a lot of speed and reliability for users and professionals when carrying out operations.

Besides, it is a safer method. Each one operates on its own node, which communicates with the rest. These nodes are linked and encrypted to protect the security and privacy of transactions, being a distributed and very secure database thanks to each of the parties’ encryption. Also, several nodes are in charge of verifying and validating transactions, making them much more secure and practically insurmountable today.

The application of blockchain allows us to communicate much better through smart contracts that are the ones that define the rules of the game of communication between several of the actors where they all have certain conditions to comply with.

Today, this new technology has already shown that it can carry out entire buying and selling processes, even with cryptocurrencies. Blockchain will also help us alleviate difficulties that professionals and users find in the market, such as the lack of information, the difficulty accessing it, the slowness in the processes, or the lack of transparency.

There is still a long way to go before blockchain will be totally implemented. From Tecnoapi (the technological company at API), we want to do our bit and, together with Alastria, to start putting this technology into practice in our sector.

Sheila Gracia

Services Director at the Catalan Real Estate Agents Association