Ways On How Blockchain Is Preventing Property Or Land Registry Fraud
The land or property registry process is very complicated and inefficacious in many countries around the world, which is one of the reasons that cause inefficiency in real estate services. One of the major issues that are caused due to the inefficiency of land or property registration is property fraud. There are different ways through which a person can become a victim of real estate fraud. For instance, it is common nowadays to take possession of land either through bribery or some other illegal practices. Once the land or property is taken over, then a person or company who took over the land can build any real estate property like a farm or a home on it and register the land or property on their name. Most of the possible ways for real estate fraud are a result of improper and insecure land or property registry. And when it comes to security, Blockchain technology is a potential solution. Everyone who is even partly connected to technology would know that blockchain can help increase data security, but here, the question arises that how blockchain in real estate can help to prevent land or property fraud.
Two of the many challenges currently faced by the land or property registry process are the involvement of Intermediaries or broker and time delays. Intermediaries or broker who acts as the agent between the buyer and government can be vulnerable to bribery and might even sell the same piece of land to two people. The land or property registry process is a time-consuming process that involves the verification of many documents. Many legal problems might arise during land registration that can cause time delay. With an increased gap between the selling of land or property and it’s title registration, the chances of fraud increases as well. But, blockchain technology can address the challenges of the land registry process.
There are only a few people who directly buy property as the process is slower due to administrative issues. But, by automating verified transactions, smart contracts can make the process much simple and quick. With a blockchain platform, anyone can create a decentralized ID to sell or buy a property. Using a decentralized ID would make ownership transfer seamless. As soon as the registrar would transfer the land to buyers’ names, the smart contracts would trigger to update the transaction on the blockchain database accordingly. Hence, blockchain will eliminate the need for Intermediaries and make the land or property registry process transparent.
If someone can take a printer and print currency, then the value of the currency will decrease by a huge amount. The same goes for confidential documents like property papers. It should not be possible for a person to have two land or property ownership document copies of the same land or property but with different details. Blockchain has the potential to address this challenge in real estate, as is evident from the non-duplicability of cryptocurrency. A person can’t spend the same bitcoin for more than one transaction.
Blockchain, with other technologies like AI, has the potential to protect the land or property management systems. The use of blockchain in real estate will allow the democratization of properties. If executed properly, the marriage of blockchain technology with the real estate industry will open up the gate for more potential investors to try their hand at real-estate investments.