RealT : Leader in real estate tokenization, is it profitable?
Blockchains, smart contracts and more broadly tokenization have enabled many innovative projects to see the light of day. NFTs, dApps, decentralized finance, blockchain companies are multiplying. RealT is one of those who decide to propose a completely innovative project to the community. Investing in real estate via real estate tokenization by buying properties on blockchains. We explain everything to you in this article.
RealT is a unique company. It offers an innovative concept which is real estate tokenization, a mix between crypto and immo. The company offers to invest in real and physical real estate through blockchain and smart contracts.
We knew so far about virtual real estate investments. Investors buy plots in metaverses and become owners of a virtual space. RealT offers something totally different with digital investing of physical assets through blockchains.
The advantage of such a system is that it allows investors to be able to start investing with a small portfolio. Indeed, this barrier is probably the main one that prevents many people from investing in real estate in real life.
To invest, you need capital, the power to borrow funds and, if necessary, a solid file that allows you to take steps with banks and hope to have a loan.
The concept of real estate tokenization breaks this barrier by allowing investors to invest with entry tickets at around $50.
Fractional investing is probably one of the solutions that the future and blockchains have to offer people looking for a profitable investment without excessive administrative constraints.
Concretely, who is RealT ?
RealT is an American company launched in 2019 by two Jacobson brothers. Their idea? Make real estate investment accessible by using the blockchains they love so much.
They create RealT with an innovative concept. Buy real estate, tokenize it and then sell fractions of it to external investors. Then they rent out the property or resell it to bring profit to the investors.
With its model, RealT offers a return of around 10% annually depending on the properties and the investment made.
How does RealT work ?
The model used by RealT is a system in which the investor does not actually own the property itself. To make its concept possible, RealT is surfing on several laws that currently only exist in the USA.
In the United States, it is possible to tokenize the shares of a company. A local law of “security tokens” allows a company to convert its corporate shares into tokens.
It is thanks to this that the RealT system is possible. Here is how the complete process offered by the blockchain company works :
RealT company buys real estate
She creates a company and it becomes the owner of the house
Company shares are tokenized
Tokens are sold to investors
RealT takes care of the management of the assets and pays dividends to the investors
Each company owns only one property and are independent of each other. If RealT were to go bankrupt, the companies owning the real estate would not be affected at all.
The companies created were originally LLC (Limited Liability Company) in Delaware but now RealT created INC due to an increasing number of foreign investors.
How to start investing through RealT ? Marketplace, return
If you want to get started in crypto investing and more particularly in this innovative crypto immo solution offered by a company like RealT, it’s relatively simple.
The American company has simplified its processes to make this investment accessible to everyone, even crypto novices. RealT recently launched a walletless mode that allows users to invest without having to link an external wallet.
To start investing in tokenized real estate, all you have to do is create an account via their realt.co site.
During registration, you will need to validate your identity via the KYC (Know Your Customer) process identical to trading platforms and brokers.
When you have created your account and gone through the various verification steps, you can start investing by going to the RealT marketplace.
If you want to use the walletless mode, you can select it by going to the menu, select “My account” then “Portfolio”. Choose walletless mode.
The real estate is referenced on the internal marketplace of the crypto immo company. Click on “Marketplace” in the site menu and you will arrive on the page where all the properties are referenced.
On the general page, you have access to a limited amount of information :
The photo of the property
Its total price
The token price
The calculation of the return in dollars per token
The start date for dividend payments
When you select a property to find out more, you have access to the complete file. This includes more complete and detailed information about the property.
A photo gallery
When we arrive on the detailed file of the property, we first have a photo gallery in which we can see more images of the property and its location.
Interior and exterior photos so that potential investors can have a real knowledge of the property.
Access to smart contracts
One of the first information visible on the detailed page is the access to the various smart contracts linked to the goods.
With a simple click, you have access to the linked blockchain addresses and you can see all the information about the smart contracts and the associated transactions.
This is one of the advantages of tokenization, it is the transparency it offers. Each smart contract is accessible and all the associated information too. If he wants, the investor can consult all the history and legitimacy of a property.
A detailed description
The property is described in text in a few lines. We find the details concerning the construction, the address, the district. It is also explained the history with the former owners and the former prices.
If the property has undergone renovations, they are also detailed. Revenue estimates are explained.
A table lists all the technical characteristics of the property.
First, the information about its price, its division into tokens, the value of the tokens, etc.
Then, the composition of the property, its year of construction, the precise address, etc.
The financial detail is explained with the information in relation to the purchase price, the amount of the rents, the fees withdrawn (by RealT and for the security fund).
An amount is kept safe if there are any costs to be expected in the property.
Finally, all the details about blockchains and tokens. The address of the owner’s wallet, the smarts contracts.
How to pay for the property in which you wish to invest ?
There are several ways to invest in RealT. If you decide to buy shares in a property, you have two options:
Choose your private wallet
Thanks to this mode, you do not have to manage the DeFi aspects by having your own wallet and having to use your private keys.
Go to your account settings then “Portfolio”, you can choose Walletless.
This means that your wallet will be hosted via RealT, in the same way as a wallet on an exchange platform. You don’t really own it because you don’t have the private keys.
This method may have drawbacks because you are not 100% owner of your tokens, but it has the advantage of being much simpler for someone who does not have knowledge of blockchains.
Connect your wallet
If you are more knowledgeable and prefer to have your private wallet, that is obviously also possible. If the “Portfolio” page, you can select “Private wallet” and follow the instructions to connect your personal wallet.
The two networks offered by RealT are: Gnosis Chain and Ethereum. It is strongly advised by the company to go through the Gnosis Chain on which there is no charge. Ethereum is much more expensive.
You can connect your Metamask wallet, one of the most popular on the market. All you have to do is add the Gnosis network to your wallet.
Buy property tokens
Whichever method you have chosen, you can then browse the marketplace and choose your property.
Go to the Marketplace.
To start investing in a property, it happens like on a classic e-commerce. Just browse through the offers and click “Add to cart” on the one you like.
You then go through the classic basket and purchase steps as on a business like Amazon.
What is the RealT yield ? Is it profitable ?
All RealT properties offer a performance of between 7% and 10%. Yields are known (an estimate) from the start on the marketplace.
To find out more about the return on a property, go to the “Financial” category on the page dedicated to the property.
It contains details of the calculation of income for investors with each cost and revenue item.
Investors receive their income each week on their private wallet or on the custodial wallet they have on the platform.
The investment therefore seems interesting and the profitability too. In principle, this type of investment seems to present a rather low risk, although obviously, there are always risks!
Our RealT opinion: interesting? scam? Ponzi?
The concept offered by the company RealT is really innovative and very interesting. They succeeded in making accessible an investment that is difficult for many people to consider.
With such a system, they allow the general public to become familiar with the blockchain and see the benefits. Smart contracts allow surprising tokenizations like these with secure and totally transparent management.
RealT’s service is fair and is absolutely neither a scam nor a Ponzi. Moreover, the company takes very little margin on the rents collected. The system they found to tokenize assets by having them belong to a company whose shares are tokens sold to investors is very effective.
The company wants to export its concept but for now, their process is only possible in the United States. No doubt this idea will be taken up elsewhere when a solution is found.
American society is also in a healthy process since real estate is not directly linked to its structure. If RealT were to go bankrupt, the assets would have nothing to do with them and the investors would retain ownership of their shares.
By offering a mode without a wallet, RealT is trying to reach a very large segment of the population who could be repelled by this concept because of the decentralized finance aspect.
The company is more and more talked about and has so far been very successful. There is a lot of talk about the concept as far away as Europe.
The opinion of RealT investors
We went to the reviews of users and investors of RealT to find out what they think of it as a customer.
On the Trustpilot review site, RealT has an excellent rating of 4.5/5.
All the reviews mention a promising project, high yields and above all a very responsive team. RealT provides its customers with a team that answers all their questions and supports them.
⚠️ This article is published for informational purposes and should not be considered as investment advice. Crypto-currency trading involves risk and it is important not to invest more than you can afford to lose.
InvestX is not responsible for the quality of the products or services presented on this page and shall not be held liable, directly or indirectly, for any damage or loss caused as a result of using any goods or services highlighted in this article. Investments related to crypto-assets are risky by nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.
Web editor for many years and SEO specialist, Thomas became an editor for InvestX when the site was launched. Passionate about the field of crypto and Web3, Thomas has made it his mission to deliver maximum value and introduce readers to the world of blockchains, considered for him as the world of tomorrow.
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