NFT - Real Estate
NFTs are perfectly designed for physical real estate – both are unique and transactions involve only changing records. When you buy a house or rent an office, you don’t physically hand over the property as you would with other assets like a car or jewelry. Real estate ownership and rights are transacted by changing records at the appropriate authorities.
Real estate is transacted through a listing, a contract, and payment. These three things are exactly what an NFT combines! An NFT is a listing with a contract and a way to pay for that contract.
The listing, rather than residing in disparate real estate databases (like MLS, Zillow and your town clerk’s office), sits on a blockchain, a publicly searchable database. The contract, rather than being on pieces of paper, is electronic so anyone can see the transaction history and know who currently holds the contract. Signing that contract uses a crypto wallet instead of a pen. Payment is made using cryptocurrency instead of fiat money. NFTs could not be a more perfectly designed tool to modernize real estate!
NFTs started in digital assets but will quickly expand into physical ones. They won’t replace traditional real estate processes at first, but instead complement them and serve niches. Adoption will be gradual and iterative. First brokers/agents will as a marketing tool and a value-add service. Niche and investment realty firms will see it as a way to modernize their own tech and marketing channel. Traditional companies and government entities will follow and individuals will vary along the curve.
Regardless of whether you work in real estate or own it, it makes sense for you to start learning. The process of “minting” or creating a NFT is the same as creating any listing: you describe the property, what you’re selling (rental or ownership), and add some pictures. Step by step details here.
Real estate = done with a listing + contract + payment = NFT
As soon as you mint the NFT, it can be found on all the NFT marketplaces and anyone browsing could buy/rent your property instantly with cryptocurrency.
If you control or own any real estate, it makes sense to create an NFT for it. First, there is almost no cost and zero downside. Worst case, you create a listing that is never used. Best case, you instantly raise the value of your property and put it in marketplaces that can earn you money now, and potentially forever.
Ask yourself, why isn’t your home currently listed for sale or your apartment currently on Airbnb? Surely for the right price, you would sell or rent to someone else. One of the main hurdles is the marketplaces around real estate are only developing and add a high frictional cost. And even when you find a renter or a buyer, there is no guarantee of payment. NFTs can eliminate both those hurdles.
Keep in mind NFTs don’t replace everything currently required for real estate transactions (e.g. taxes, deed transfers, etc.) but it offers a way to skip many of the steps that made the whole process difficult in the past. As services develop, we may not be too far away from a day when you could walk by a house you like and own it as you walk away.