Disclaimer: The below post is a translation of the original report broadcasted on Korean National TV. Due to foreign language nuances, slight imperfections and distortions may be present in the below text.
Online housing transactions based on blockchain technology are popular all over the world these days. We are now able to provide solid information on this new kind of sale. Why has there been such an expansion in this real estate technology sector?
Blockchain-based real estate transactions have been recognized by the (American) National Association of REALTORS. The first transaction was performed in Ukraine by a company called Propy in 2017. These are legally binding real estate transactions. The use of distributed ledger technology makes traditional transaction data storage methods obsolete. Furthermore, these records become unhackable and immutable once stored on the blockchain. The fees are low due to automated blockchain processes.
The real estate blockchain startup, Propy, already has a presence in the United States, Europe, and Russia. On the other hand, despite their efforts, Korean real estate startups have been unable to eliminate transaction friction and transaction fraud to the same degree, to the dismay of South Korean real estate consumers. This is due, in large part, to the government’s strict regulation of blockchain technologies, especially as they pertain to the real estate industry. This has stunted domestic innovation within multiple sectors of this young and dynamic industry.
Despite difficulties, blockchain real estate transactions can still be made within South Korea, even though formally government-sanctioned standards have not yet been solidified. The hope is that multiple domestic companies, services, and agencies will collaborate to make these processes as simple as possible for the largest number of customers.
This may not prove to be as difficult as one might think; the Department of Homeland Security also launched a one-stop real estate transaction system in January. The government promoted the pilot project with Jeju Island to get it off the ground. The government is pushing this next-generation e-government business, and the estimate is that it is within four years of maturity.
PropTech’s advances and the Fourth Industrial Revolution are emerging in the global market. When it comes to technology innovation, South Korean companies must not be behind the curve. I’m concerned about being behind the competition.
This is Korean TV with Lee Keun-Hyung.