The Real Estate Institute of Queensland (REIQ) will deliver the world’s first fully digitised residential tenancy agreements by the end of this year, which will see enable agreements to be executed as a digital smart contract in Queensland.
The system has the potential to transform the way that tenancy agreements are transacted across the nation and around the globe, and create an unparalleled, real-time database of rental prices and trends.
REIQ General Manager Josh Callaghan said the product provides more transparency and enables new functions.
“By executing as a smart contract, we’re also able to build out the functionality to handle payments of bond and rent, plus facilitate other activities related to the property such as routine inspections and maintenance,” Mr Callaghan said.
Mr Callaghan said the new smart contracts would use blockchain technology to create a simple and secure transaction for each tenancy agreement that would leverage the benefits of the technology as an irrefutable source of truth. The technology has far-reaching applications for the real estate sector, particularly as more ancillary services come online.
“Most people have heard about blockchain in the context of Bitcoin, which is somewhat unfortunate as the technology has applications for every sector. Smart contracts, in particular, are clearly the way of the future in a form of law that has relied on a hand-written signature for literally thousands of years,” he said.
Mr Callaghan said the innovation would make renting a property much easier and more transparent for tenants.
“This solution has been designed to reduce the manual handling of contracts from the property manager-side, while streamlining the process for tenants and giving both parties much better visibility over the agreement,” he said.
As well as upending the way residential tenancy agreements are executed in Queensland, the proptech innovation will ultimately create a real-time view of the State’s rental market.
“The instant a tenancy agreement is signed, we will know how much a property was rented for, how long the agreement is for, how long it was vacant and so on, which will give the REIQ unprecedented insights into rental market trends as it happens,” Mr Callaghan said.