American homeowners have long borrowed money by leveraging the equity in their homes. However, in recent years despite low interest rates, it has become increasingly harder to borrow. According to USA Today, a Treasury Department economist during the Obama administration says, “It’s harder to do a cash-out refinancing or get a home equity line of credit than it used to be.”
In addition, the number of ways for Americans to tap their home equity has been limited. The primary method has been borrowing using loan products, such as a HELOC, which increases the level of debt against a real estate property and requires a monthly payment. Americans now carry more overall debt than before the Great Recession, according to data from the Federal Reserve Bank of New York.
Announced today, a real estate network built on Blockchain believes they have a solution: the first decentralized residential real estate marketplace. “Having to borrow from a bank simply to access the wealth that you have built up in your home is deeply unsatisfactory,” said Matthew Sullivan, CEO and Founder of QuantmRE. “Our ability to digitize the value of a homeowner’s equity and realize the locked-up value will solve a huge problem for homeowners worldwide.”
QuantmRE effectively buys a small part of the member’s home equity in a shared equity transaction. For investors and token-holders, QuantmRE will provide the first real estate asset-backed token whose value is supported by a distributed network of these equity interests in residential, owner-occupied homes. For homeowners, it offers the prospect of releasing cash for their equity without increasing their burden of debt.
“QuantmRE’s tokenized real estate asset structure solves a problem at the heart of current investment barriers and housing issues,” said Emily Bush, blockchain and real estate investor and advisor to QuantmRE. “By giving homeowners access to the equity capital in their homes without taking on more debt, the QuantmRE Network is enabling people to maximize the returns from the biggest investment they are likely to make in their life. By unlocking the value in home equity, QuantmRE is creating wealth, encouraging and promoting savings and enabling investors around the world to participate in a previously untapped real estate asset class.”
Within the U.S., single-family residential housing represents a $31.8 trillion asset class, and globally, the market size exceeds $168.5 trillion. We have already seen houses purchased with Bitcoin, but Real Estate marketplaces like this could unlock even further value in the digital asset markets.