Change is the adaptive response to a situation we define as a crisis, where we are called to question, review priorities, decide what to keep and what to let go.
Today, with the crisis well visible around us in many aspects, we are experiencing an unprecedented scenario of social dynamism where change is driven by the ever-increasing availability of innovative low-cost technologies and a new way of understanding one’s existence within a fluid and borderless society.
In this scenario of technological and social revolution, it is interesting to observe what is happening in the real estate world, where large technology companies have directed their attention and are beginning to redefine the entire sector, exactly as previously happened with the banking, financial and insurance services sector with the arrival of FinTech.
PropTech is the term used to refer to a new business model that sees technology and digital applied to the real estate sector.
Among the new technologies and solutions that are about to revolutionize real estate, we must dutifully remember some, such as Blockchain, virtual reality, artificial intelligence, BIM technology, and tools for collecting and analyzing big data.
These technologies offer efficient solutions to the historical problems of the real estate sector, such as physical distance, transparency, security, and speed of operations between the parties involved.
Blockchain promises significant changes for all those sectors that, like real estate, require decentralization and disintermediation.
This technology is based on a network that, from a functional point of view, allows managing a database in a distributed way, while from an operational point of view, it is an alternative to centralized archives. It also allows managing data updates thanks to the collaboration of all network participants, with the possibility of having distributed, shared, and accessible data for all participants themselves, thus allowing data management in terms of verification and authorization without the need for centralized control.
Let’s now analyze the characteristics of this technology that help us understand the changes between today’s work and tomorrow’s work:
Digitalization, that is, the transformation of data into digital format.
Decentralization, information is recorded and distributed among multiple nodes to ensure cybersecurity.
Traceability of transfers, each element on the register is traceable in all its parts, and it is possible to trace its exact origin.
Disintermediation, platforms allow managing transactions without intermediaries, i.e., without the presence of trusted central entities.
Transparency and verifiability, the contents of the register are transparent and visible to everyone and are easily consultable.
Immutability of the register, once the data is written on the register, it cannot be changed without the network’s consent.
Programmability of transfers, that is, the possibility of programming certain actions that are carried out when specific conditions occur.
Blockchain represents a new concept of digital trust based on cryptography, mathematics, and the network. A concept of trust that opposes the current one based on a central authority, public or private, that acts as a guarantor.
The applications of Blockchain seem to be countless. Specifically, some of them allow us to understand concretely how this technology will change the work habits of mediators, service agents, and the entire real estate industry.
The imminent digitization process will allow converting all the paper documentation present in our offices into digital format, thus improving the circulation of information with obvious advantages also in terms of environmental sustainability and cost reduction.
For example, one of the early stages of a real estate agent’s work is to obtain documentation related to properties: let’s imagine how digitizing the archives of the Land Registry, the Land Registry Office, and the Public Administration would make both the search and delivery of documentation easier and faster, and how analyzing this data would allow for a detailed, constantly updated, and secure record of each property. Thanks to this data, agents will be able to know, among other available information, how many times a property has been sold and at what price, thus benefiting from significant assistance in the evaluation and analysis of the market.
Another fundamental application of Blockchain in the real estate transformation process is smart contracts: a technological application of contracts.
Smart contracts are an incorporation of contractual clauses coded in computer language, in software or computer protocols, which are used to conclude contractual relationships, providing automatic execution of the programmed terms upon the occurrence of certain conditions. This means that the contract will be executed exactly as the source code dictates and will ensure that each party honors the transaction agreement.
Smart contracts offer the possibility of concluding contracts directly from smartphones or computers anywhere or anytime you desire.
The arrival of Blockchain and the digitization of identities, documents, and contracts leads us directly to think that they are also destined to change our relationships with some of the professional and institutional figures that have always played central roles in guarantee and control, such as notaries, banks, and financial institutions.
The digitization process will speed up, simplify, and make many procedures that agents currently spend a lot of time on more economical. Thanks to technology, it will be possible to focus more attention on fundamental aspects of the profession such as customer care and professionalism with which it is exercised.
Technology does not put the real estate agent’s figure at risk, but rather absolves them from many technicalities that currently characterize the profession, restoring and emphasizing the importance of the human component.
Real estate reduced to its essence has always been a game of numbers and relationships, and it is precisely on these aspects that agents will be called to confront, trying to best enhance the experience offered to customers.
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