Try Quests to earn cryptoLofty AI Platform Dashboard
What is Lofty AI?
Lofty is an online marketplace that:
– Helps prospective sellers of properties in the US tokenize their real estate;
– Offers tokenized properties for sale to investors globally;
– Appoints property managers on behalf of investors who collect rent & make hires for repairs & maintenance;
What is Tokenization & Why Does Lofty Use It?
Tokenization is the process of creating fractional representative units of an asset. In the case of Lofty, each property’s appraised value is divided into units of US$50 each, and these units are called tokens.
So a property with a US $100,000 value will have 2000 units of USD 50 each representing the entire ownership rights in the property.
Lofty utilizes this method of distribution because it opens up investment avenues for a huge market at home & abroad for people who don’t have the financial capital and/or our constrained by a myriad of laws to invest directly in physical real estate.
All you need is a cell phone & an Algorand wallet with USD50 worth of stables, and you’re all set.
How Does the Lofty Marketplace List Properties?
A property owner desiring to sell his property applies to the Lofty marketplace. At this stage, an initial desktop appraisal is undertaken to approve or deny the listing based on several factors including but not limited to occupancy status, condition, location, rental history, etc.
Once the property is approved, it is put under contract by a newly formed LLC. The LLC is then tokenized into individual $50 tokens on the Algorand blockchain.
The next step entails the hiring of a professional property inspection company that shall provide a report to improve upon the initial desktop appraisal. The main concern is the need for repairs which, if required, are done so by the seller or a net payment is accepted by him with a credit to the LLC.
In the last step, the property is listed on the Lofty marketplace. Once all tokens representing the property are sold, that is, the property is fully funded, and the LLC will move for transfer of the property by registration of the title deed in its name.
Investing
You can now start browsing properties in their marketplace. Together with pictures, the marketplace provides & curates detailed financial data, inspection reports, and property documents.
Once you decide on a property, you will need to opt into that property using your algorand wallet. This is basically a security feature, like permission to the protocol, to send you your tokens in exchange for $ALGO, $USDCa, or $STBL.
Final verdict on Lofty Real Estate Investing
Lofty presents a unique and innovative application of blockchain technology to a real-world problem. It shows us a path as to how we can create access to global investment opportunities.
Personally, I have to also commend them for democratizing access. Many people, in the US or abroad, cannot buy real estate to live in leave alone as an investment. The Lofty product offering solves this barrier to entry.
The most fascinating aspect is that they have a product that is KYC-compliant and this gives you a glimpse of the future of finance and investment. I believe that investors, no matter the size, should take advantage of this product to diversify their portfolios.
