I have embarked on a journey to create a business investing in real estate, using digital ledger technology, and solving a problem. First I would like to explain what I want to do, then explain why digital ledger technology and then what problem I want to solve.
The problem, I decided to start here.
I think there is a problem with fiat currencies worldwide suffering from inflation, reduced purchasing power and a shortage of accessible investments to protect purchasing power for people in all financial classes. I think the most traditional investment is a home. But with inflation and stagnant wages a home is out of reach for many people. So one of my goals is to provide a way for people with small amounts of money to invest in real estate. This is made possible by fractionalization. The other problem I wish to solve is to make it possible for older people, with younger children, who own their home, have equity in their home, and wish to access the money, without a second mortgage. This project allows them to stay in their home, access the equity to help themselves or their children, without taking out a second mortgage or selling, then leaving their homes.
The solution, seems like the logical next topic.
The solution is to digitize ownership of the asset: the home. The home title can be researched and digitized, so it is visible on the blockchain. Then the ownership can be represented by digital tokens, or NFTs of a fixed number with no others being mintable. Then these tokens can be sold to raise funds. Each represents a share of the property, and can be sold for 100, 1000 or 10,000 USD. Thus for the cost of 100 USD someone becomes a part owner of a real estate property.
The details, always read the fine print.
I plan to tokenize luxury homes, which have the highest rate of appreciation.
This means for a 100,000 property, 1000 hundred dollar tokens can be minted.
The home owner can retain 50% and sell the rest on a NFT website.
The homeowner receives 50,000 USD to use for themselves or their children.
The homeowner does not create a second mortgage.
The homeowner doesn't create a second mortgage payment.
The tokens are sold via a smart contract, written with terms dictated by the homeowners, which allows the homeowner to stay in the home, and token holder receives tax benefits like depreciation and the token gains value through the properties appreciation and market forces.
The original token buyer can hold it for the term of the contract or sell it anytime at the current maket price, suggested by the smart contract and based on the appreciation of the home.
If the home appreciates 5% per year, in ten years token purchasers will enjoy a 50% return on their investment.
Summary
Tokenization is a solution, to a problem, using digital ledger technology, NFTs and global markets.
These markets allow anyone with a internet connection to buy a share of real estate in various places in the world, for a fraction of the purchase price of these real estate assets.
It solves the problem of small investors not having enough capitol to invest in real estate, by bringing down the cost of ownership.
It provides a vehicle to protect the purchasing power of dollars earned today, which will be spent in future years by allowing the value of the fiatearned dollars to increase when invested as opposed to losing purchasing power when the dollars are just held in a bank account. It solves the problem of homeowners who want to access the equity in their home or investment property but don't want to sell it or take out a second mortgage.
