Fractional real estate 101

Did you know that today you can own a percentage of a property by holding tokens? If you wonder what a token is, have a look at the glossary below.

Through a process called "tokenisation", the ownership of a real estate property is represented by one (or multiple) virtual token(s). Rather than dealing with regular real estate processes in an outdated manner using paper documents, buyers can use tokens for digital transactions.

Tokenisation of properties leveraged by blockchain is a new way to invest and makes real estate accessible to a larger number of potential buyers, lowering the barriers to become a landlord.

In practice, it means that a property is divided into fractions and that any person, through the use of the Internet, can invest and buy these tokens representing part of the the ownership of said property. This whole process might seem complex but is actually quite simple: the token issuer creates a digital duplicate of the property he/she wants to sell and stores on the blockchain all relevant information such as the property’s specifications and ownership documents. This digital version of this property is then split into digital tokens. For example, instead of selling a house at a price tag of EUR 1 million, the seller would sell, for example, 100 tokens at value of EUR 1 000 each.