Investing in real estate through blockchain

By Basalt | WritingOnTrains | 1 May 2020


Invest in the US real estate market through fully-compliant, tokenized ownership. Let's break that down.


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I want to talk about a project I'm very excited about. RealT

First: Why invest in real estate?

Real estate has been proven to increase in value over time and outperforms other investments. Dottie Herman, CEO of Douglas Elliman, says and I quote: ‘Real estate is a bankable asset. Unlike the stock market, where many factors are out of your control, your investment can’t disappear overnight.’

Unless you’re Baba Yaga and your house has chicken legs 0_o

You get rental yield from tenants. That means a steady stream of passive income.

I’m not going to waste your time or insult your intelligence by listing all other reasons why investing in real estate is a good idea. You can do your research.

Let me move on.


Second: What does fractionalized, tokenized ownership mean?

 

If you were to go the ‘traditional’ real estate investment route, you would need a very high entry cost ( to buy the real estate ), you’d be buried under tons of paperwork, and real estate isn’t a liquid asset ( you can’t quickly and easily convert it to cash )

BUT when you convert the rights of a property ( the title deed ) into a digital token, you are essentially transferring the ownership rights onto the blockchain.

A blockchain gives you advantages: accessibility, immutability, transparency, and liquidity. 

Fractionalized ownership of a property gives you the power to own a portion of a property and receive rental income proportionate to the number of tokens you own. That is something traditional real estate cannot do.

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Blockchain has paved the way for many possibilities that traditional industries and modes of investment simply cannot do the ‘old way’.

‘But how is this possible? How does one own real estate through this method you speak of?’

 

Quote from David Hoffman, RealT's Chief Operating Officer 

“RealT” is two things. RealToken Inc (us, the for-profit company) and RealToken LLC (the legal entity that creates system that enables the tokenization of the properties)

Real Token Inc., A Delaware registered business entity, is the name of our company. We refer to it, and can said to be doing business, as RealT.

In order to conduct a business to offer real estate worldwide, RealT has created a separate entity, also Delaware registered, named Real Token LLC. It is a master or if you will, umbrella, company. It does not own any other LLC or other business entity, nor any property. It’s primary value is to simplify and lessen the complicated and costly legal process incumbent in providing what is characterized by US authorities to be an investment security offering; which each and every property we offer is deemed to be.

(So rather than having a nearly 100 page private placement memorandum for each offering, one master ppm is required and each following offering requires only a much shorter amendment.)

Finally, for each offering we create a Series LLC; each of which own a single asset (a property), has its own token and unique address. Each stands solely and legally on its own, is not cross collateralized with, nor affected in any legal or operating manner to, any other series LLC. Each is owned by the investors who purchased its unique tokens and upon whom ultimate governance lies.


Third: Do your research

Let’s talk about credibility and safety. Let’s talk about the team. It’s very simple. You shouldn’t just take my word for it. No one should. If you are a serious investor, you should do your own research about them. 

Start with their bio

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Fourth: Why I like RealT

Let’s get personal.
Why do I like RealT? For many of the same reasons I talked about above.
I’ve been investing for decades, first in traditional shares, before looking into cryptocurrencies.I’m not a trader. It requires a certain type of personality and mindset that I’m not suited to.

I like passive income. Getting stable income daily and predictably, is, in my opinion, much better than the emotional rollercoaster I would get from trying to trade in hopes of a profit. 

Yes, at my current stage I’m getting cents daily, but that adds up over time. The company is reliable and young. Their current area of focus is Detroit, which means that over time your property will grow in value, while they acquire properties in other areas for you to invest in. Getting in early is always a good thing when it comes to investment.

Full disclosure. I get a little something when you sign up using my link. But you will find investing in real estate through RealT to be a great addition to your portfolio. Do check them out. Any questions, just let me know. More than happy to answer.


Disclaimer: Please do your own due diligence. This isn't investment advice.






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WritingOnTrains
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