Real estate investment, when done properly, can be a tool to generate passive yields and long-term wealth. Many people think you need to be wealthy to get into real estate, but with tokenized real estate platforms like Landshare, you can invest for as little as $50.
Real estate provides a unique combination of stability, regular cash flow, and the potential for massive growth over time. In the United States, real estate has consistently outpaced the rate of inflation and has had a virtually unbroken upward trend for the past 60 years.
Many crypto-centric investors have never considered an investment in real estate due to its limited availability in the cryptocurrency space. With Tokenized Asset platforms like Landshare, you can enter the market without ever leaving the blockchain. Here are some of the best reasons to invest in real estate on the blockchain.
1. Provides protection against inflation
While conventional traders often take their profits into stablecoins during bear markets and downtrends, real estate backed-tokens can offer a great alternative. According to the U.S. Bureau of Labor Statistics, annual inflation rates in the US rose to 6.8% in November of 2021, the highest since June of 1982.
Stablecoin protocols are continuing to mint more coins in order to keep up with the rate of inflation. Just recently, Tether minted 3 Trillion new USDT coins. Meanwhile, the typical home price in the US is up a record 13.2%, according to Zillow.
Taking your profits into stablecoins can mean losing out to inflation. Real estate-backed Asset Tokens appreciate at a rate that not only outpaces appreciation, but also offer monthly cash flows.
2. Low barrier to entry
While real estate investment traditionally suffers from a high barrier of entry, fractional investments on the blockchain are extremely simple. With a minimum investment of only $50, getting into the real estate market with tokenized platforms like Landshare has never been easier. The Tokenized Securities Dashboard allows you to KYC, sign a purchase agreement, and make a payment all in one place. The entire process only takes a few minutes and you never need to worry about bank transfers or fees.
3. It’s hassle-free
Tokenized properties are managed on your behalf, so you never have to worry about management, tenants, or property taxes. Rental yields are sent directly to your wallet each month, and appreciation is automatically applied to the value of the Asset Tokens.
Because everything occurs on-chain, your funds never have to leave the crypto space. Payments are made entirely in cryptocurrency, and your entire real estate investment is held in your wallet of choice.
4. Earn reliable off-chain yields
Asset Tokenization enables yields from off-chain markets, in this case real estate, to be brought on chain. The advantage of this model is that it does not rely on the overall health of the cryptocurrency market or the rates of a specific protocol. Yields do not fluctuate based on the number of stakers, instead, investors can expect a consistent cash return for as long as the property is occupied. Despite the funds originating off-chain, they are still provided directly to your wallet in the form of a stablecoin.
5. Asset Tokens provide additional security
With traditional cryptocurrencies, investors must be wary of hacks, rug pulls, and lost private keys. Each year, billions of dollars are lost to crypto hacks. If one of these events occurs, there is generally no way to regain access to the lost funds. With Asset Tokens, this is not the case.
While real estate tokens mostly function like any other, they do come with some additional security features. Because each token holder is a shareholder of a real estate holding entity, they are legally entitled to their yields and ownership stake. This means that tokens can be administratively transferred from a hacked or compromised wallet to a new one. Even if your wallet is hacked, your tokens will be re-issued and you will never miss a payment.
6. Tokenization makes real estate liquid
Real estate is traditionally regarded as an illiquid investment. In other words, it can be very difficult to convert real estate assets back into cash. With tokenization, however, real estate becomes a fully liquid asset class.
Each Asset Token can be fractionalized to the penny and easily sold to another investor without the need for paperwork, legal fees, or closing costs. Because everything happens on-chain, the process of the sale only takes a few seconds. This allows holders to cash out their investment at any time without incurring fees.
7. Asset Tokens can be leveraged with DeFi features
Landshare allows investors to leverage their investment using a number of DeFi features, including auto-compounding and NFTs.
Real estate NFTs allow investors to earn additional rewards by staking their asset tokens and upgrading their NFT properties, while auto-compounding allows investors to automatically increase their real estate exposure and earn a bonus yield in the process.
To learn more about these features and more, check out the Landshare docs.
8. Asset Tokens are backed by tangible real estate
Cryptocurrencies and NFTs are intangible assets whose values rise and fall rapidly based on market sentiment. There is no guarantee that a given digital asset will retain its value over time.
Investments in real estate are investments in tangible assets. No matter the state of the economy, people will continue to buy, sell, and rent properties. While there is no guarantee that property values won’t fall from time to time, they tend to do so much less drastically than intangible assets.
If historical trends are any indication, real estate market corrections tend to be short-term, and assets typically regain their value quickly.
With inflation rates at 30-year highs and market volatility creating uncertainties, it has never been a better time to invest in real estate. Landshare’s Tokenized Asset feature gives cryptocurrency investors the opportunity to enter the real estate market without ever leaving the blockchain.
Unfamiliar with asset tokenization? Curious how real estate on the blockchain works? Check out our Tokenized Asset Overview Youtube video.
View our current Tokenized Asset offering at: https://app.landshare.io/property-details