Blockchain is revolutionizing commercial real estate investing, says Hernando Fernandez
Blockchain makes real estate investments simpler, faster and more scalable
MIAMI, FL, USA, March 28, 2022 /EINPresswire.com/ — You can’t read very long about investing these days without coming across a reference to Bitcoin or some other form of cryptocurrency. However, even investors who are not all into the cryptocurrency market are benefiting from the blockchain to make other types of investments. Here’s real estate and blockchain maven Hernando Fernandez’s take on the matter.
Blockchain makes real estate transactions easier than ever
Real estate, especially commercial real estate, has notoriously high barriers to entry. Capital requirements are high and, what complicates matters, not all investors have access to the same information. Off-market transactions are accessible to well-connected people, so the pool of investment opportunities for uninformed investors is even more limited.
Real estate is also illiquid. Real estate is generally not held in shares. When this is the case, the stock market is generally small.
Blockchain, advises Hernando Fernandez, offers a solution to all of these challenges. Blockchain provides a centralized system for information as well as value. Anyone in the network has access to all information.
Blockchain data does not belong to any single entity. They are transparent. They are immutable and inviolable. Investors can place extremely high
trust in the blockchain.
How Hernando Fernandez Sees Blockchain Changing Real Estate Investing
The full impact of blockchain on real estate is yet to come, but Hernando Fernandez sees several ways blockchain will revolutionize real estate investing.
As data becomes more available, investors are likely to be more open to crowdfunding. Capital requirements and property debts decrease. More investors can participate in the operation. Investors who cannot undertake a transaction on their own can become majority investors, allocating funds to balance their portfolios.
Fractional shares pave the way for fractional ownership. Of course, joint ownership is not a new idea. It has always been possible to sell the same property to several people. Blockchain opens ownership possibilities to a much larger number of participants.
How is blockchain being used in real estate investing right now?
Hernando Fernandez is quick to confirm that no known real estate transaction relies entirely on blockchain, but there are many current real estate investment transactions that incorporate blockchain.
Smart contracts, for example, are automatically executed when pre-determined conditions are met. These contracts have terms built into their blockchain that specify these requirements. When the first set of conditions is met, a new set of instructions is activated, and so on, until all fundraising activities are complete and the contract can be executed.
The Property Club real estate platform uses blockchain to help subscribers identify, buy, sell, market and finance commercial real estate transactions. It uses smart contracts to facilitate transactions and Bitcoin to make payment. Realblocks uses blockchain to make fractional shares available to investors. ManageGo uses ledger-based software to help managers quickly respond to repair and maintenance requests.
All of these systems, Hernando Fernandez points out, cut out the middleman. They reduce costs. They are also unregulated and should only be used by the uninitiated with expert advice.
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