The next phase of the crypto economy has arrived. In this phase, the rental properties are divided into digital tokens which are sold around the world. This disrupts the operation of owners, as token holders convert owner activity into a series of online pools. A system that tenants are necessarily aware of.
Among many tech startups, Lofty AI is changing the world of real estate by creating a new type of real estate investing. They contribute to the trend of Distributed Autonomous Organizations, or DAOs, which promote ownership and cooperation.
Real estate investing is not something new for the average individual. Websites like RoofStock and Fundrise offer the ability to buy shares of homes and commercial developments in remote locations, but for years they have required at least an investment of $1,000 or more and also have restrictions related to the withdrawal of money by users.
Lofty AI brings a revolution in this system and creates an unregulated online market in which any individual in the world can invest as little as $50 for the purchase of a digital token equivalent to an interest in a property rental business unique. Each token representing a share of ownership in a Delaware-based limited liability company.
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Desiree Fields, who works as an assistant professor of geography and global metropolitan studies at the University of California, Berkeley, points out that historically real estate has been seen to resist change, but today is experiencing all kinds technology and real estate. real estate companies.
She points out that the new real estate market is emerging, which in turn indicates how popular the housing market has become, pricing in more future homeowners while attracting even more investors.
Fields adds that you can own 1/50th in case you can’t afford to buy a house for yourself.
Lofty AI is still in development. Its online marketplace, which started last year, has about 90 rental properties posted so far, most of which are in Rust Belt states including Illinois, Michigan, Missouri and Ohio. Current rental activities are carried out by property management companies.
Gipson, 24, is not a traditional Memphis property manager. He is a student in the San Francisco Bay Area and also owns token shares of rental homes in Chicago, and he votes on issues that regularly affect his properties, such as the new ceiling fan, which has been approved by the owners.
He says he feels like “an owner making those decisions.” His plan is to eventually sell his tokens for a down payment in exchange for a house of his own.
The buying and selling of tokens is recorded on a blockchain, a system in which many nodes contribute to a shared database or ledger that is not controlled by a central authority. Chu said blockchain ledgers are a perfect replacement for old-fashioned record keeping in real estate because transactions are transparent.
Also, he said there was no trust between buyers and sellers, and because of that, he said “you have this whole escrow and settlement process.”
However, it is unclear whether the idea of democratizing rental property investment would be welcomed in a tight housing market that is already undergoing significant change due to other tech companies.