Tokenizing the Real Estate and Adopting Blockchain Technology (C Estate)

By 9jaflick | Coinloaded | 29 Oct 2019

In the past, a buyer would personally inspect the property that he or she is interested in. The only problem, though, is that such visits are often inconvenient and time-consuming.

Today, such visits are no longer necessary. There are many sites on the internet that allow potential home buyers to inspect different homes using only their laptops or mobile devices. Such sites offer images of the different parts of the homes as well as zoom-ins and zoom-outs of certain areas.

C ESTATES offers a complete ecosystem solution that includes listing, tokenization of real estate properties and marketplace for property investors, brokers, buyers, and sellers. Through digital ledgers from blockchain technology, transactions are recorded permanently together with its activities and, all the changes are tracked through digital footprints.

The benefits of C ESTATES platforms should be obvious. It allows people to see different types of homes quickly and without leaving the comfort of their current home. If they like what they see, they may even buy the house outright without going through the formality of a live tour.

It’s worth mentioning that C ESTATES online platforms allow buyers and sellers to track property prices in different communities. These platforms use the latest Blockchain Technology and tracking software to provide their audience with fast updates on the latest home prices in their community.

Not only does this feature allow home people to find better deals, but it also offers a certain degree of transparency, because most buyers and sellers want to know the fair value price for different types of properties.

C ESTATE BLOCKCHAIN ADOPTION

The real estate industry is undergoing a digital transformation. While historically a “pen and pencil” business — often relying on inefficient and archaic methods for doing business and keeping records — technology has begun to help reshape the expanding global market.

Blockchain technology, especially, is feeding into this transformation (in ways similar to how the emerging tech is disrupting other long-established industries like banking and insurance).

The decentralized-record-keeping technology, which is designed to instill trust in the authenticity of digital transactions, could be used to create efficient solutions for both commercial and residential real estate — from buying property to conducting due diligence to enabling crowd-sourced investments, and more.

Blockchain real estate. Several industries have lately discovered the sheer amount of positive utility the blockchain technology into their space. One of those industries happens to be the real estate industry. Real estate remains the largest asset class in the world. As per Fortune, London-based real estate advisor Savills tallied up the value of all global property, including commercial and residential property and forestry and agricultural land. By their calculations, the total global real estate valuation comes a whopping $217 trillion total, and residential property makes up about 75% of the total value.

The Biggest Problems with the Traditional Real Estate Industry

#1 Not open to everyone

Real estate has long been the investment choice of the rich. Very few assets manage to provide the same degree of passive income and capital appreciation. The problem is that the barrier of entering the real estate market has always been extremely high. These barriers could be citizenship, international bank accounts, Credit Score, financing, cash requirements, accreditation, and having accessibility to the right sponsors and fund managers.

If you are planning to invest in another country, you will have to make at least one international trip and to visit the property. You will have to spend a lot of time and go through several middlemen to invest in the property of your choice.

#2 Severe lack of transparency

The Panama Papers controversy showed us the depth of corruption and dishonesty in the real estate business. A higher degree of transparency can combat corruption, tax evasion, and money laundering. According to the United Nations, $800 billion – $2 trillion USD is laundered globally every single year. A significant amount of it is laundered through real estate. The UN Office on Drugs and Crime estimated this figure to be in the region of $1.6 trillion in a single year.

To understand why this is a big problem, think about this – According to Global Financial Integrity, almost 80% of the estimated $1 trillion which leaves developing countries in these illicit financial flows, could be taxed to provide revenues for public spending on global challenges such as infrastructure and climate change.

#3 High fees

If you are investing in international real estate then here are some of the fees that you will have to pay – exchange fees, transfer fees, broker fees, attorney fees, taxes, investment fees, etc. Because of the sheer number of middlemen involved, foreign real estate investment can be an expensive process. Also, you need to keep in mind that you will need to consult lawyers and accountants as well to make sure that your tax returns are in order.

#4 Lack of Liquidity

Now we come to one of the most significant problems with real estate. They are notoriously difficult to liquidate. Liquidity is defined as how quickly an asset or investment can be converted into cash. The reasons why real estate isn’t as liquid as crypto is because:

Cryptocurrencies can be listed on a public exchange and sold quickly in open hours.
The number of buyers for crypto is a lot more than for real estate.

The Liquidity of an asset is directly proportional to the supply of the buyers. The problem with real estate buyers are:

Firstly, the barrier to entry is very high when it comes to real estate.
They aren’t looking to buy any property which is far away from where they live (except in the case of international real estate.)
Real estate dealings have loads of third parties involved so the transactions are bogged down by fees and regulations. This discourages potential buyers.
Even if you do find some buyers, you will be locked up in a lengthy transaction process, and the chances are high that it will end in failure.

#5 Pricing Commitments

Real estate investment requires a lot of capital upfront. More often than not, investors have to look at expensive alternative methods of financing. Also, when it comes to international real estate having an excellent credit score in your native country, won’t carry over to the country that you want to invest in.

#6 Transaction Speed

Like we have mentioned multiple times, real estate transactions can be extremely slow. According to Juwai Chinese Consumer International Travel Survey, 56% of Chinese investors spend over one year finding their ideal US investment property. In general, it can take you six months to find a property and another six months to fulfill all the formality needed to acquire it.

Keeping all these factors in mind, you can see why the real estate industry is prime for disruption. This is where the C ESTATE comes in.

C ESTATE TOKENZING REAL ESTATE

Tokenization is a brand new blockchain-powered process that allows the actual value of real-world properties to be converted into tokens that are part of a blockchain.

Tokenization of assets is in principle a process of transferring the actual amount of an asset into numerous parts, each of which is owned by individuals who can’t possibly afford the price of the whole asset. The value of the individual holding is represented by digital tokens which can be traded on a token exchange platform to earn the desired amount. Real estate is considered one of the most lucrative assets an investor can possibly own. This is because of the consistent cash flow, security and value appreciation associated with real estate.

Tokenization refers to the process of using blockchain-based tokens to represent ownership in an asset. The conventional process of buying and selling of properties is generally a long drawn process. Therefore, Blockchain App Factory is here with its team of dedicated professionals who can help with tokenizing your properties. Tokenized real estate is a good source of obtaining faster funds.

As real estate is one of the illiquid assets, the process of tokenization can help bring in some liquidation. Tokenization thus ensures faster selling of properties and allows investors to buy real estate in fragments. The token can represent ownership in an asset, equity or interest in debt and a whole lot of cash inflows! Blockchain App factory is one of the pioneers of blockchain technology that can help you with tokenization of real estate asset

WHY C ESTATE IS TOKENZING REAL ESTATE

Tokenization created liquidity: the investment pool for tokens is truly global (anyone that meets capital requirements and has an internet connection can invest)
Lower investor barriers: The barriers for investor entry will likely be lowered as real estate assets become more liquid, the accredited investor restrictions may view tokenized real estate in a more liquid light — that 8.25% of all U.S. households would expand massively
Programmable securities: Since tokens are been allocated/managed through blockchain that would automatically enact important processes, e.g. automated dividend payout through smart contracts, which would reduce costs. Even if some manual work was required, it would be less relative to not having blockchain involved
Security and immutability — cryptographic encryption protects these assets, and blockchains tracking the tokens are append-only, meaning everything that has happened in the past is public to anyone who might want to look, and that includes the regulators

Platform Features

Buying: Select a wide array of properties from different owners and contact them directly.
Retail: Announce your property for rent or receive your rental fees with XCET coins.
Showcase: Showcase your property ready for bidding or for sale.
Land Banking: Provides online marketing tools for landowners to showcase their undeveloped land to attract more audience and investors from the crypto world.
SELLING: List your property for sale in the marketplace once offline verification and validation have been completed.
Time-Sharing: Provides online marketing tools for property owners who need to offer their time sharing properties in our marketplace.

Token Structure and Economics

C ESTATES will issue its own utility token called XCET, and a separate real estate-backed token called Digital Property Assets (DPA) that are both NEM-based mosaic. These will be used to transact exclusively within the C Estates platform.

Digital Property Assets (DPA)

The DPA is the asset-backed digital representation of physical properties within the C Estates platform. The DPA doesn’t represent physical ownership of the physical asset but rather the rights to earn future revenue from the property.

XCET
XCET is the native utility token that will be used for any transactions within the C Estates platform. There will only be 8,999,999,999 XCET to be created, never to be increased.

TOKEN DETAILS

IEO Hard Cap: 38,000,000 USD

Total Token Supply 8,999,999,999 XCET

Initial Circulating Supply 35% of the total token supply

IEO Token Price 0.012 USD

IEO Allocation 3,149,999,999.65 XCET (35% of Total Token Supply)

IEO Vesting Period: No lockup

Seed Sale Token Price 1 XCET = 0.006 USD

Seed Sale Allocation> 2% of the total token supply

Seed Sale Vesting Period> 1/5 unlocked in the fourth month after
Token Generation Event.

Remaining> 4/5 unlocks 1/5 every quarter over 15 months.

Token Type> NEM Mosaic

Token Distribution> Within 30 days after the end of the token sale
After the IEO, 25% reserve of XCET will be available to the public
outside of the exchange platform.

CONCLUSION

Technology plays an important role in the real estate industry. Aside from allowing real estate agents to reach out to more buyers and clients, they also make the whole transaction process easier and more efficient.

Technology also allows realtors to offer more information, transparency and importantly trust to their clients. So if you’re a real estate agent then you should leverage the latest technology to help you in your work.

Initially, C ESTATES’ plan is to focus in the Philippine real estate market targeting properties that are under Condominium Certificate of Title (CCTs), these are properties that can be owned by foreign investors. In the
short term, we will have these properties listed and
marketed to the global real estate investors interested in
the Philippines.