What
is Real estate tokenization?
Real
estate Tokenization is the process of digitizing the value and
the ownership of property into multiple fractional tokens that can be
distributed among investors across the globe. This gives the holder
of the tokens the right to own a portion of the property legally and
the creator of the token, increased liquidity of funds.
The
advantages of Tokenizing a real estate asset is to increase
investment opportunities by bringing in a large pool of investors
around the world, who would want to invest in real estate in other
countries.
Using
a Real Estate tokenizer you can tokenize any Commercial properties
and Residential properties. Cities like Dubai are miles ahead and
have already tokenized some of their properties so interested
investors can invest in them.
Why
is Real estate Tokenization the next big thing?
Real
estate from time and time again to this day are one of the major
sources of wealth for many entities be it individuals or
corporations, It is globally, one of the largest owned asset class.
By investing in real estate properties, People have made a fortune or
have lost a lot of their money by making a few bad decisions.
Globally, the real estate market is $217tn in size, yet it remains as
one of the most unregulated, opaque.
Though
various attempts have been made to regulate, manage and liquidate,
this area, every individual or institution that owns real estate
would have faced nontransparent transaction costs, differential
pricing and taxes, illegal enchroachment, misinformation about the
property, property rights opaqueness, and a set of troubles that are
a subset of these major issues.
A
Tokenized real estate brings transparency and improves liquidity in
the previously known notoriously irregular market. Real estate assets
that are tokenized can help weed out opaque property listing sites &
middlemen who may add differential pricing and increase the cost of
ownership that may seem undesirable to a lot of potential buyers.
Since these tokenized assets are easily tradeable once listed on an
Asset trading exchange, Real estate tokenization improves the chances
of making the property lucrative for both long-term and short-term
investors, who are keen on trading these just like they would with
commodities.For a builder, Tokenization of real estate is a boon, as
they can raise funds quickly to construct the building or complete
the pending construction if they have already started.
A
tokenized real estate is a security token that would pass the Howey's
test as these are backed by an asset. To protect the investments of
the stakeholders, an escrow would be set up and linked to the smart
contract with a set of milestones, everytime a milestone is reached,
the payment is released. This way fraudulent builders don't enter the
Asset tokenization platform. Also, the platform that tokenizes the
property and the exchange that lists it would require legal
compliance paperwork before the token is listed for sale.
How
does Real estate tokenization work?
To
make the property tradeable it needs to be tokenized. After all the
legal compliance check is completed, the real estate tokenization is
carried out. Post which that it has to be listed on a reputed asset
trading exchange.
Compliance
and undertaking
Before
creating the tokens, a thorough compliance check on whether the
property exists (if it is partially or fully built) / the necessary
permits have been received to start the construction. A thorough
background check about the builder is also carried out. Once the
check is completed, the next step follows.
Legal
representation
The
construction company with the help of a law agency needs to have all
the paper-work related to the tokenization ready before the real
estate tokenization process.
Real
Estate Tokenization
To
tokenize the real estate, a real estate tokenization platform or a
real estate token Development Company is used, where all the
necessary formalities are filled out and then the tokens are created
with the smart
contract and transferred to the construction company that wants
their real estate to be tokenized.
Escrow
Once
the tokens are created, a reputed escrow agency is set up to handle
the future transactions, track the milestones to release the payments
in a timely manner to safeguard the investments of the investors and
to ensure a smooth payment process between the builder and the
investors.
Listing
on a Tokenized Real estate Exchange
Before
listing the real estate tokens, the exchange carries out a check for
all the necessary compliance and the details about the escrow. Once
the exchange approves the real estate token, it is listed for
trading. Finally, the trading begins.
What
are the features of the Real Estate Tokenization platform?
Real estate tokenization
platform offers the ability to create, market and distribute your
tokens to interested investors. The smart and thoughtful features
that have been built into it allows you to conduct a Security Token
offering or an Initial
Token offering easily. Some of the features
Accepting
Payments:
Accept
payments using Stripe, Paypal, Bank Transfer, Bitcoins, and Altcoins.
Semi-automatic
payments:
Manually
verify and send tokens easily to those who have paid for the tokens
right from the dashboard. All the data with the proof is received
from the user and displayed here for you to verify easily.
Custom
Token price change event:
Set
the price to automatically change at a pre-defined time. The new
price will take effect till the next price change event. You have the
option to notify your users before the date too.
Marketing
module:
Send
email campaigns and SMS campaigns to people who have purchased your
tokens, to those who haven't or both. Notify users of new events,
Show them the progress of your STO related events.
Campaign
Scheduler:
Send
now or Schedule it later. Leaving somewhere? Just save and Pick up
where you left from the drafts.
Track
Campaign performance:
Right
from your dashboard, you can track the individual campaign's
performance easily, see if a user has received, opened, unsubscribed
from the campaign.Campaign Bounce has been handled as well.. If a
user unsubscribes, they won't receive campaigns any further, this
reduces your spam rate.
Company's
Income / Expense Tracking:
Built-in
Income and expense tracker allows you to create income-expense
reports right from the dashboard and display it to your investors to
garner trust.
Dividend
Payment Configurator:
Configure
dividend payment cycles, half yearly or every quarter. Set the
ex-dividend date, cum-dividend trading period and the percentage you
will be paying your users. The system automatically calculates the
amount you will have to pay and displays it in your admin panel at
every interval set.
Dividend
Payments:
Making
your Initial Token Offering (ITO) truly compliant with government
regulations, now you can notify your users of the dividends you have
paid them. All from your dashboard.
GDPR
Compliant:
You
can now display a mandated GDPR message to the user on the site. Set
it on the dashboard.
Thanks
for reading our Content. To know more about our Services, kindly
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