With cryptocurrency, it is going to be a new world for real estate, especially in market transactions. It is expected that cryptocurrency, in time to come, will play a key role and will ultimately shape the real estate market landscape globally and locally.
It is not far from reality that more properties will be enlisted online on e-commerce real estate/property platforms. These platforms will become the meeting points for prospective dealers in real estate to exchange interests in properties. Buyers will contact posters to buy properties they want.
One of the long term impacts of cryptocurrency on the real estate sector will be seen in the gradual elimination of physical/traditional agency services and other intermediaries. Traditionally, real estate transactions in Nigeria require sellers, buyers, agents, guarantors, witnesses, etc. to interplay the closeout of various transactions. Introduction of cryptocurrency will end some of these hurdles and connect the sellers directly to the buyers.
When cryptocurrency becomes an alternative as well as the means of exchange as opposed to the use of fiat currency, the Naira, it will become possible for properties to be listed with their cryptocurrency values and their Naira equivalent.
Consequently, the ease at which properties could be bought and rents paid, using cryptocurrency, would be enhanced. This may further straighten the legitimacy of cryptocurrency and facilitate its usability as we tend to move from cash-based to electronic financial transactions. This will finally implant cryptocurrency into the real estate sector.
When cryptocurrency is fully integrated as a payment option in real estate transactions, it is most likely that the growth in some other sectors of the economy such as banking, finance, information technology, agriculture, etc. will be impacted on a positive direction.
Commerce and trading technological applications will need to be developed to support the required volumes of trade in the real estate sector. In addition, these applications will also need security, maintenance, customer relations personnel. These may ultimately result in the creation of smart technology jobs.
It is envisaged that the possibility of multiple acquisition of interest/ownership of large real estate facilities will become feasible. High-value real estate properties will be offered for sale in cryptocurrency on multiple-acquisition/ownership basis to prospective buyers, who would acquire portions, depending on their financial capabilities.
In order to perfect the transactions, pre-determined smart contracts will be executed online by parties to the transactions.
Control parameters for verification and measurement will be required. This will enhance upkeep of records of all real estate transactions, verification and scrutinizing of prospective buyers, sellers and other stakeholders, verification of property rights and detection of possible fraud, etc.
Besides the technological control, it will be mandatory to have the alignment of government at all levels for the final registration and documentation of the transactions. Issues of change of ownership, surveys, etc. would still have to be regulated.
Estate Surveyors and Valuers are well-positioned to provide professional services and guidance in all the aforementioned areas, irrespective of the type of transaction involved—cryptocurrency or fiat money.
It is, therefore, pertinent to brace up for these upcoming opportunities. It might seem hindered or delayed for now, but one thing that is certain is the fact that at the appointed time, it will come to manifestation.
Real Estate business in Nigeria will be transacted in cryptocurrency and that time is almost now. The certainty of this stems from the fact that Nigeria has emerged as one of the biggest sources of Bitcoin trading volume in Africa as of August 2020.
The country is becoming one of the fastest-growing Crypto markets in the world as per the data from Bitcoin P2P marketplace, Paxful. As of December 2020, Nigeria was ranked second next to USA in crypto trading volume.
Emmanuel Inyangudoh, an estate surveyor and pastor, writes from Uyo, Akwa-Ibom State.