A recent study conducted on behalf of the Australian Institute of Housing and Urban Research (AHURI) critically examined the technological disruptions in our housing and home markets. has uncovered new knowledge and forward-looking forecasts.
Our research team has identified an interesting opportunity: the potential of developers to use blockchain technology to attract micro-investors – which would not be limited to the same country but could potentially come from around the world. These investors would each own small parcels of shares (or tokens) in development. In essence, this would create a means of crowdfunding for real estate development.
The main difference between this new investment model and the existing real estate investment trusts is that, thanks to real-time information, blockchain real estate gives micro-investors total control over this they buy, without having to pay high fees. charge to manage a similar investment.
The blockchain could also improve relations between tenants and landlords in the private rental sector. Once coupled with blockchain security, standardized rental application forms could be significantly expanded to become a ledger of all the applicant's rental records. This could include their correspondence with agents and owners, their history of arrears and their bonds. If it is robust enough, it could eventually replace the need for references.
Similarly, a complete record of the owner's history as a professional housing provider could also be available, indicating whether the owner was responding quickly to maintenance and repair requests; increased rents excessively; or had been brought before a government court (such as VCAT), and if and how the issues had been resolved.
Beyond the hustle and bustle of the blockchain, the growing capabilities of artificial intelligence also cause disruptions in the real estate market. Machine learning algorithms, which learn by analyzing large data sets, help to "understand" data (based on legislative or policy documents). This information can then be exploited using a variety of methods, including classification, clustering, decision trees, and more.
In urban planning, for example, it can be argued that such systems allow for the automatic interpretation of legal applications of land use. Digital planning systems now have the ability to perform initial assessments of planning proposals based on long-term data collected from historical planning decisions, as well as laws in the territories and states. This could accelerate the evaluation of planning applications, especially smaller projects, and make developers applications faster and perhaps cheaper, resulting in potentially increased efficiencies in housing supply.
Ensuring adequate data protection is essential for these systems to be adopted without inappropriate interference with privacy, a reform that may be necessary. This requires reasonable laws and reliable institutions to ensure compliance with these laws.
Australia's current privacy, information and data protection administrations and institutional structures are underfunded and inadequate. A powerful and independent Information Commissioner and a Privacy Commissioner would be a useful first step in ensuring that existing legislation is properly enforced.
Professor Christopher Pettit
is the first president of
urban science at the
University of New South Wales
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