It’s still early days for Blockchain technology, but a number of Maltese real estate companies have confirmed to this news portal that they’re looking into harnessing the technology for the real estate and property industry, even though they believe its practical implementation may be years away.
As Claudine Cassar, leader of Deloitte Digital Malta explained in a blogpost last month, Blockchain is a technology based on a distributed database that can store information regarding any type of asset, including property. Since it would be stored on a peer-to-peer (P2P) network of nodes, it would ensure that information in relation to each property is constantly up to date and that prospective clients would have easy and transparent access to information. It would also make property searches more efficient and enable users to make faster, better-informed decisions.
Steve Mercieca, CEO, Zanzi Homes
“The team at QLZH is considering Blockchain technology,” Steve Mercieca, CEO of Zanzi Homes, told Maltachamber.org.mt. “We are in fact redeveloping our entire back office system at the moment to improve our performance and keep up to date with trends such as virtual reality and Blockchain. Although we still believe the market is extremely small and still a long way away, we want to be ready for and possible fast track.”
“The thought of digitally making local property data transparent and accessible has been a topic of discussion between myself and a number of practitioners in the real estate field for a couple of years,” said Benjamin Grech, Managing Director at Engel & Völkers Sara Grech. “Internally we have looked into developing systems which make each user more accountable for the data they input although our main focal point has been transaction values for the purpose of property valuations. However our sample of data on actual final values on exchange is limited to our market share. A nationwide database is something I can only dream of at this stage.”
“Technology is bringing people closer in many aspects of life, including financial transactions. Removing the intermediary will achieve this and I personally believe it is something customers want, including customers within the property industry,” Mr Mercieca continued. “The removal of intermediaries, paper work, and verifications such as identity verification, asset ownership verification, property history verification, which currently take weeks to complete, could be done within minutes, saving time and money for both the seller and the buyer. The existence of these decentralised property databases will also increase transparency and security, and will assist in fraud prevention.”
Benjamin Grech, Managing Director, Engel & Völkers Sara Grech
“When we discuss real estate transactions, the work flow starts from the details of a physical property and how that can be shared between a number of brokers seamlessly,” Mr Grech added. “A multiple listings system is a database where which is widely shared amongst brokers who individually represent the seller or the buyer. This system has been adopted within a number of industries and could be the first step towards a more efficient and transparent marketplace. In addition, when we discuss property prices and the exchange of title, the use of Blockchain can be a system which drastically simplifies our laborious transaction process of research of title.
Blockchain is a core component of the digital currency Bitcoin, where it serves as the public ledger for all transactions. Could cryptocurrencies also play a role in Malta’s property transactions? “With its resources, the Government is in the best position to study the impact and possible benefits cryptocurrencies can bring to the country. In our efforts to become Europe's, and the world's most attractive country to live and invest in, I feel we should not discard, but also not rush into, innovations such cryptocurrencies,” said Mr Mercieca. “After thorough analysis, legislation should include cryptocurrencies transactions but moreover offer security and protection to its users. There is definitely a lot of buzz about Blockchain in the international start up community. Malta, being such a start-up and tech hub should work hard on attracting this market.”
“There is a probability that one day people will buy property with Bitcoin or a similar currency, but since 90 per cent of property purchasers use bank finance, the current market practice would have to be drastically altered,” Mr Grech says. “However, change is happening at an exponential rate as information and communication has become so readily available and easy to exchange. I would look to invest in catering for and regulating such transactions.”