Chicago Real Estate
things to consider before buying or selling
Last year, Chicago readers started reading about real estate sales transacted in bitcoin. Since Chicago real estate changes hands through transactions involving six- or seven-figure dollar amounts, the idea of actually completing sales in the mysterious new digital coinage was novel enough to get a lot of attention. “Will Bitcoin Revolutionize How Real Estate is Bought and Sold?” asked NAR.com this past February. The answer was maybe, but probably not in a meaningful way—at least not any time soon.
So Chicago homeowners needn’t feel that they are likely to be left out of some momentous advantage if they don’t constantly track bitcoin’s value gyrations. But there is a related phenomenon that could prove to be more of a Chicago real estate game-changer. It’s not the cryptocurrencies themselves, but rather the technology behind them: “the blockchain.”
At the simplest level, a blockchain is a list of transactions in chronological order. Accountants have always called such a list a ledger. Monkeying around with entries in a ledger is a practice likely to land someone a jail sentence.
The ultimate aim of Chicago real estate transactions is to verify who winds up owning a property. Traditionally, a local official keeps track of who owns what by means of a recording in a book. As a result, today land records (deeds, oil-and-gas rights filings, mortgage documents and the like) are housed in more than 3,000 courthouses and city halls around the country. Some are available in searchable databases, some are in the process of being scanned and converted—but many are not. In any case, the process is labor-intensive and subject to human error.
As Fast Company wrote recently, the current state of affairs “…can make figuring out who has rights to a particular piece of land cumbersome and vulnerable to…fraud.” Everyone agrees that this way of tracking ownership doesn’t sound much like a 21st-century solution.
Enter blockchain technology, which could create a tamper-proof digital registry. Without going too far into the weeds, once real estate title records are regularly validated via blockchain, much of the manual paperwork will be eliminated. At the same time, those records become more transparent, easily accessible, and forgery- and fraud-proof.
So while bitcoin uses blockchain technology to keep track of who owns how much of the currency, a completely separate phenomenon will emerge when the technology becomes standard for verifying real estate ownership. That will cut down on much of the labor, bringing significant cost reductions along for the ride. It will be revolutionary.
Keeping ahead of the changing real estate landscape is an important part of my service. I hope you’ll give me a call for any and all Chicago real estate matters!
I am a Chicago Real Estate Broker that loves to show people around the Chicago neighborhoods.