To understand the potential of a blockchain land registry system, one must first understand how property changes hands. When a purchaser seeks to buy property today, he or she must find and secure the title and have the lawful owner sign it over. This seems simple on the surface, but the complex is in the details. For a large number of residential mortgage holders, flawed paperwork, forged signatures and defects in foreclosure and mortgage documents have marred proper documentation of property ownership.
Land registration management refers to the registration/management of all land deeds/transactions undertaken in any geographical jurisdiction of a governing authority. In most countries, these records are maintained with various government and local bodies. However, the registration of land records does not confer ‘land title’, which at times leads to title disputes and costly litigation. There were thousands of plots of land where the rightful owner could not be identified, and in many instances ownerships were in dispute.
Blockchain technology can be leveraged to establish trust, transparency and accuracy in maintaining land records and building a robust land record management system. Putting land records on a blockchain would make them immutable and tamper-proof, thus securitising them and building a firm pillar of trust in the system. The resulting land record management system would be a public ledger spread over a distributed network that records each and every transaction associated with a land parcel/property in an autonomous and efficient manner. All land deeds and their associated records would be immutable and irrefutable, thus saving a lot of money on land-related litigation. The cost of storing these records physically and the voluminous paperwork associated with verifying details about any property would reduce. This would, in turn, save time and promote transparency in the land record management system. By using hashes to identify every real estate transaction (thus making it publicly available and searchable), proponents argue issues such as who is the legal owner of a property can be remedied.