The customers and the seller benefit tremendously from smart contracts agreements. Since the smart contract eliminates the third party from the agreement on the sale of property, both the buyer and seller will save money by not using the third party. Using a third party in the purchase of real estate costs a good amount of money. To be exact you are paying the hard party for the closing fee and generally can expect to pay 2% to 5% of your home’s purchase price in closing costs. Smart contracts eliminate that because parties involved can set a condition that can trigger a series of actions when met, without the use of a third party. So the buyer and the seller would want to use smart contracts in real estate.

The reason for why people want smart contracts in real estate is because the process is streamlined and transaction time and fees are reduced. With the use of contracts you can create a digital receipt for the house. Getting a digital receipt on a house will mean that the house (contract of the house) will now be securely stored with blockchain technology. Smart contracts are digital contracts that execute the “if/then” functions automatically. Which means that if for example a person fails to pay rent on numerous occasions the house can automatically through different combinations not allow the person to get in the house, no need for more paperwork. It will automatically be recorded on the blockchain with all the other necessary information regarding the house. It is safe, easy and reliable and that is why people want to use smart contracts in real estate.

Blockchain and smart contracts are perfectly fitting the real estate industry. There have been numerous new companies coming out with their development of smart contracts for real estate. Such companies include SMARTRealty, Propy Inc., PropertyClub, Mata Capital and more. The smart contracts work in real estate by executing the “if/then” functions automatically without the use of third parties or even people. The only thing that has to happen is an agreement and signing of the smart contract after which the “if/then” function goes into effect.