UPRETS SHARE | Why Digitalization Is Changing the Way Do Real Estate Businesses?

For the past few years, Real Estate business has been booming, and different stakeholders invest vast sums of money in real estate business. The real estate business is thought to be very complex as there are multiple stakeholders involved in a real estate transaction. In addition to this, the real estate business also includes enormous sums of money, numerous parties involved, and even many regulations. All these factors make this sector too complicated.

All these pitfalls of real estate business can be solved if people use the newly discovered method of “real estate digitalization.”

What Is Real Estate Digitalization?

Under the process of real estate digitalization, property owners can issue digital securities through blockchain technology and platforms. The digital securities that real estate owners issue represents a certain amount of shares for different real estate properties. On the other hand, other investors can buy the shares, and by doing so, they become the partial owners of the assets.

Another benefit of digitalization is that investors can also sell the shares whenever they want as per their convenience. They can also purchase and sell the shares through different online platforms available.

Asset digitalization will also lead to financial inclusion, and it will also open up the liquid asset to a broader class of investors.

An Interesting Example of Real Estate Digitalization in 2019:

This example will show you a real example of real estate digitalization. This will also give you an idea about how to estate the real estate digitalization.

When a real estate owner decides to digitalize a property, a real estate digital security is created to represent the share of the property. The total value of all digital securities is equal to the full value of the securitized asset. For example, if you want to digitalize an estate worth $30M, you need to divide the property into shares such that one share is equal to 1 square foot. Thus, in this case, one share will be equal to $300. The other way to digitalize the property is to divide it into inches. In case of digitalization into inches, the property will be valued at $2.08/inches. Once the digital securities are created, and investors purchase the digital securities, the property is listed on an exchange so that the investors can keep track of the growth and downfall of their digitalized real estate property.

How Digitalization Benefits the Owners and the Investors?

The most important benefit of the digitalization is that it removes all kinds of mediators from the real estate transaction. Digitalization also leads to a reduction in the cost of digital securities. Thus all types of investors can invest in the transaction. The investors can also acquire digital securities at a very low cost and with no additional fees or charges. In other words, digitalization allows investors to raise capital without any financial intermediaries who underwrite the property.

Real estate usually provide huge returns, but people can’t spend too much on property investment. Investors in digitalized real estate get the benefits of both the real estate world. They get a high return on investment and also the liquidity of the stock market.

What Are the Benefits of Digitalization for Real Estate Assets:

There are a variety of benefits that digitalization offers. The three major benefits of digitalization include:

1. Ownership:

Blockchain has immutability, and thus, their features transfers really well with digitalization. Under the digitalization, a digital history helps the stakeholders and investors prove their ownership. In addition to this, this digitalization structure also reduces the chance of all kinds of fraud. If a property digital security owner tries to sell a particular digital security multiple, the digitalization structure will show them the exact history of ownership, and it will also reduce any kind of trick and falsification.

2. Improves Transaction and Share Management:

The programmability offered by digitalization enables automated events when certain events are met. In addition to this, digitalization also improves investor management. With digitalization, you can rely on a third-party exchange, and thus, it is possible to track the secondary exchange. Investors also have the ability to vote. The programmability under the digitalization process also helps in speeding up settlements as it contains built-in compliance.

3. Improvement in Liquidity:

Digitalization provides the opportunity for fractional ownership. You can get digital securities under real-estate till 18 decimals. This means that you can get a digital security of any denomination. The investor entry in digitalization is much lower, and thus, investors of all sizes and capitals can invest in digitalization. Most investors don’t have $100,000 to invest in real estate transactions. But, investors who have as less as $500 can also invest in digitalization, and they can easily become fractional investors and owners in real estate transactions.

Digitalization has lots of potentials, and it can be easily used to make real estate transactions viable for all kinds of investors. Before the coming up of the digitalization process, only accredited and institutional investors had the ability to invest in real estate transactions.

The coming up of digitalization has enabled transparency and much-needed liquidity to otherwise opaque sectors. The ability to trade shares online and the ability to hold shares of any denomination has attracted many investors worldwide.

Digitalization is giving investors and owners alike freedom to raise/invest; capital; however, they choose.

The property digitalization will allow investors to access the asset class, and it will also enable a liquid secondary market.

For years, real estate is one of the established investment strategies. Due to the upcoming blockchain technology, real estate is also becoming similar to the conventional equity market. With the help of transparency and constant monitoring by digitalization, the real estate market is becoming more appealing to potential investors. Large numbers of investors are today benefitting from the security and flexibility offered by the digitalization. The high degree of transparency, security, flexibility, fast speed, and clear mechanism of digitalization will also attract a large number of investors in the coming future. Thus, gear up to invest in real estate if you want to get additional benefits with digitalization.

About UPRETS:

UPRETS is a platform focused on simplifying investment in real estate.

We are dedicated to providing a convenient, compliant and advanced real estate digital securitization platform for property developers, asset owners and investors globally.

By utilizing UPRETS platform, real estate developers and assets owners can create digital securities for their properties, allowing investors to benefit from the rental dividends and capital appreciation of the properties in major global cities.

Backed by a publicly listed real estate conglomerate (NYSE:XIN) and our award-winning, patented blockchain technology, Xbolt, we bring a network, experience and luxury assets to the platform.

For more information about UPRETS,

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