Blockchain technology is revolutionising the real estate sector and transforming how business in this realm will be conducted in the future.
Though initially created to support cryptocurrency, blockchain technology has now made a quantum leap, going beyond the purview of Bitcoin and Ethereum. Today, it is possible for people and companies to make high-value transactions — including those of immovable assets like property — without the need for intermediaries.
By undermining the liquidity challenges associated with owning hard assets, tokenisation is democratising asset ownership with blockchain- stored tokens. Reselling assets is now easier and geographic boundaries in real estate transactions are becoming history.
The enormous potential of blockchain is being leveraged by Dubai, which is at the forefront of driving the smart transformation of the world economy.
The Dubai Blockchain Strategy, announced by His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum; Crown Prince of Dubai, Chairman of the Executive Council of Dubai, and Chairman of the Board of Trustees of the Dubai Foundation of the Future; sets a clear roadmap for businesses to tap into the potential offered by blockchain technology.
The strategy aims to achieve the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, to make Dubai the first city to be fully powered by blockchain by 2020 through the three strategic pillars of Government Efficiency, Industry Creation, and International Leadership.
For the real estate sector, driving the transformation is Dubai Land Department, which has created a blockchain system using a smart and secure database of all real estate contracts. The move to smart contracts will cover lease registrations and link them to utility and telecom accounts as well as all property-related bills.
The end-to-end transactions recorded on the real estate blockchain will provide scalable, secure, transparent, shared, and immutable property data for all the participants in a trusted network. This means data relating to real estate can be shared and accessed across different government and private sector entities, all of which benefit from real-time insights. Eliminating all manual processes, real estate transactions are not only becoming faster but also more flexible and relevant.
The immediate impact of this transformation is the speed in which property transactions will be conducted; what would have taken 20 days to be concluded can now be accomplished in less than 30 minutes.
For customers, the advantages are manifold: By creating a single platform for all the different services provided by various stakeholders, blockchains will enhance the customer experience and make the journey — from sales to after sales — seamless.
A significant impact of Dubai’s move to blockchain technology in the real estate sector is the reduction in the need for pureplay brokerage services as the single digital real estate platform will oversee all sales and rental transactions as early as next year. For an industry that has long been influenced by brokers, the transformation will mean greater value for customers.
Taking the blockchain transformation into actionable plans, Smart Dubai recently integrated blockchain technology into its online payment portal — DubaiPay — to enable the real-time reconciliation and settlement of transactions.
In short, Dubai not only has set in place a strategy but is also implementing impactful tech reforms that will make blockchain technology an integral part of the industry’s operations, with the winners being all stakeholders, but predominantly the customer.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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