Blockchain tested live – can save billions for house purchasers and mortgage borrowers
Lantmäteriet (the Swedish mapping, cadastral and land registration authority), SBAB, Landshypotek Bank, Telia, ChromaWay, Evry, Skatteverket (the Swedish tax agency), Svensk Fastighetsförmedling, and Kairos Future have presented a live testing of a blockchain solution for real estate transactions. During the seminar a fully digital real estate purchase was made. The solution can contribute to the savings of at least 500 billion Euro per year for Swedish real estate buyers, sellers, and borrowers.
– It’s fantastic that we have brave government agencies like Lantmäteriet, and cooperation projects like this, that dares to investigate the unknown, drives innovation with new technology, and contribute to Sweden’s position as a leading digital nation in the world. We need more of this, says Åsa Zetterberg, Chief Digital Officer for Sweden, who gave an acclaimed speech at the seminar.
A world leading project
The Swedish blockchain project for real estate transfers is seen a the leading project in the world. Wall Street Journal recently described Sweden and Lantmäteriet as a pioneer within blockchain and real estate. World Economic Forum has mentioned the project as one of four in the world to keep an eye on. One of the world’s most respected academics in the blockchain area, professor David L. Yermack, Chair of Finance department at Stern, New York University, has described the reports from the project as “extremely well written and informative”. The international attention for the project reflects the integral value a well-functioning system for a land registry and real estate transactions is for a society.
– Sweden has been in the forefront of the development of the Land Administration services since the foundation of Lantmäteriet, the Swedish mapping, cadaster and land registration agency, in 1628. Digitalization for instance has many times happened in Sweden among the first in the world. We want to continue to be in the forefront in order to meet the demands from the next generation of customers; and won’t be satisfied with what was best in class ten or twenty years back, says Mats Snäll, Chief Digital Officer, Lantmäteriet
– The last property unit that was registered in the digital Land and Real Property register in Sweden was a property from the island Gotland at the end of the 1990’s. It feels great that the next steps towards a safe and digital property transfer starts at Gotland Mats Snäll continues.
Several billions can be saved for Sweden
While the value of improving international land registries is known the value to Sweden is also substantial. Savings of 3 billion Euro per year among Swedish banks and brokers can be achieved. In addition to this, greater innovation, new services, and speed and time-savings for consumers are substantial. A more competitive market for mortgages is also possible. A total cost saving, equivalent of a 0.25% interest rate reduction is fully possible.
Attractive solutions for governance and leagal
Apart from continuing to improve the technology and the processes the project has worked intensively to map the legal aspects of the solution and governance issues. The conclusions are found in a report.
By Magnus Kempe