Blockchain Real Estate Rental Auction Platform

Transcription

1 ResiBids : Blockchain Real Estate Rental Auction Platform Summary Problem Statement properties Scenario General Overview ResiBids General Mechanism Model ResiCoin Value Proposition Global Housing Network Internet of Things (IoT) Implementations Additional Amenities Smart Contracts Ownership Maintenance Voting Bidding Model 1 Smart Bidding 2 Range Bidding 3 Optimal Scheduling 4 AI Organization Renter Guideline Outside the Network Scalability ICO Details The Math Behind the Model

2 SUMMARY: A community bidding (ebay auction style) on disruptively low priced rental properties from a global property portfolio, where these properties have been purchased by ResiBids from the ICO capital raise and listed on a decentralised blockchain platform These new ResiCoin tokens are required to be owned in order to bid on the properties for rent on the ResiBids platform The ResiCoin token is akin to a pre-purchase of rent, which can be used at any time The ResiCoin token s unique utility is that you need to own these tokens in order to rent properties on the ResiBids platform Aside from our own mortgage free property portfolio that ResiBids owns through the ICO, and makes available to the token owning community for rent, ResiBids also opens up the same (ebay style) auction bidding system for any property owner to list and rent their property out on our platform (AirBnB style) We will make this same auction system available for people to list their properties for sale on the ResiBids platform as well This entire property listing and auction system will be setup on the blockchain making it decentralised and transparent ResiBids will set up separate foundations or corporate entities in each country/jurisdiction to own the properties, with a constitution publicly available that explains how we plan to never sell the properties, except in extreme circumstances, when the old property would essentially be swapped for a new property purchase, only if absolutely necessary Problem Statement Properties Why are mortgages and rentals super inflated beyond their actual value? The answer is simple, and many people already know the truth behind the unfortunate reality we are living in. There are middle men in the process, bankers or landlords, sometimes both, who take a cut of what renters and homeowners pay to have a place to live. These intermediary take advantage of a necessity, and everyone else pays for it. Here are two scenarios. The first of a young American couple buying their first home. These two people, in their mid-20 s, don t have much but they d like to settle down. They look for a nice neighborhood that s within their price range of 10% deposit down on a home. This lets them purchase a $200,000 home with only $20,000 down. That seems too good to be true, and it is. In reality, that couple just bought a home for 2.5 times its actual value. Over the course of their life time the total cost to the bank will be paid out (calculated with a historical average of 7% interest rate over a 30-year period) as a total of $480,000. Now this is on average over the last three decades. Let s take a look at a lucky scenario. Imagine the couple entered the market at the best time historically to buy a house at 3.35% in December of This couple would be able to buy a $200,000 for the price of $320,000. That is ridiculous, the bank automatically will Page 2 of 9

3 receive that payment or the asset as collateral. The only winner is the bank and the loser, the home owner. Scenario The average cost to rent an apartment in the US is about 1.5 % of the total cost of the unit. In an average unit with a price point of $70,000, the rent per month will be about $1,100 before taxes. If rent was a full-time solution, one would pay around $380,000 in 30 years. Enough money to buy a house for three times the amount of the apartment. If the apartment was worth the equivalent of the house in the previous scenario ($200,000), one could expect to pay a staggering, 1.1 million dollars for their stay and at the end, have no equity. This is the current system we live in, with hyper inflated rentals and mortgages at the expense of the consumer. Now how could this scenario be different? Well, the current breakeven point for a landlord is around five and a half years. After that, they have a passive form of income with minimal overhead. This property could last 30 years with some renovations here and there, and the investment is nearly guaranteed to grow 5x in that 30-year window, and that s even without raising the rent to counteract inflation. But what if we double the break-even point, or tripled it? Well that would reduce the rent to a half or a third of its previous price. That same exact unit would now be rented for $600 or $400! Imagine how much freedom that would allow the tenants! They could save the money to actually buy their own property without a bank or they could take a lower paying job where they are happier. This future isn t too far out of reach. General Overview ResiBids is a simple concept. It is the tokenization of the renting process around the globe. Members of the community have the ability to bid on exclusive rental properties at prices that are significantly lower than typical market value. This is achieved by using the ICO capital to buy properties without incurring mortgage fees. In turn, those who bought these tokens will be first to have the opportunity to bid on properties for rent. The earlier someone joins the network, the less competition they will have when bidding and the greater deal one can get. Additionally, all revenue goes directly back into property expansion across the platform, and based upon algorithmic modeling, the system s expansion and baseline pricing will directly reflect the market s demand. ResiBids General Mechanism Model Here s how the ResiBids system works. Through an ICO, funds are raised to purchase real estate, specifically, apartment complexes around the world. Then, the rent of those apartments is set according to the purchase price multiplied by a certain fraction. This fraction represents how long it will take ResiBids to be reimbursed for the purchase, 1/X; X representing the number of months. The breakeven date is then X months away from the date of purchase.. Compared to a 60-month break-even point of traditional rental models, ResiBids will have closer to a 150 month break even and can charge rent for about 40% of the traditional price. Now this is where things get really interesting. This money will go directly back into funding further development projects, and those in the community (who own tokens) will have the opportunity to participate in polls on which locations and also developments are bought and integrated into the Global Housing Network. Page 3 of 9

4 ResiCoin The ResiCoin itself is the backbone for the ResiBids platform. Built upon the NEO network (or equally fast blockchain), ResiCoin has the capability to construct smart contracts, log bids, log transactions, verify a user s identity, track voting, and store ratings and reviews for tenants and landlords. All of these functions will be built directly into the ResiBids platform UI so that all of this information will be easily accessible to users. The coin s primary use will be as a form of payment for rent, however the previously mentioned use cases will apply without the additional effort of a coin user. Value Proposition The value of ResiCoin will not be tangibly linked to the assets of ResiBids Global Network, rather, the token s value is derived from the utility of the token itself. ResiCoins are used to access the platform filled with state of the art apartments, which will grow with more and more options each day! Global Housing Network The Global Housing Network will be comprised of hundreds of properties around the world varying in price range. These properties will all be equipped with state of the art IoT (Internet of Things) appliances and other technology that moves our world towards a more sustainable future. Some properties will also have additional benefits such as being fully furnished with free wifi, things of that nature. The specifics of these implementation will be decided upon by ResiBids and its community to provide housing solutions that utilize the technology of the future, and also are reasonably priced. IoT Implementations The IoT (Internet of Things) implementation within particular houses may include items such as a self maintaining fridge that automatically orders food that is missing, or a system that will automatically adjust the heating in the apartment to contour to your personal preference. Due to the IoT and blockchain implementation working in parallel they can actually support each other to provide one fluid customer experience. If you d like to purchase a bottle of wine from the shelf, just take it and your account will automatically be charged at the end of your stay. Additional Amenities An interesting benefit of ResiBids is ResiBids Gold, Platinum, and Elite. These are clubs for members who rent property over the course of the year valuing a total of more than $10,000, $50,000 and $100,000 USD. These members are allowed access to certain luxury apartments, resorts owned by ResiBids, debit card, and other benefits that will be revealed at a later date. Smart Contracts In addition to IoT implementations, ResiBids users will have the ability to customize their stay using smart contracts. By having an IoT lock for the apartment, the tenant can automatically get a key to the apartment right on their smartphone for the specific days of use. * Additionally, if the users wanted to have their payments for the apartment spread out over the time of their stay, they could elect to run a smart contract that incrementally pays off their bill for everyday during their stay. Page 4 of 9

5 Ownership Ownership of the properties will be under different foundations around the globe all registered to the ResiBids foundation. ResiBids will legally establish itself unable to use any of the funds received from the property ownership for payments outside of properties growth and maintenance as dictated by the will of the ResiBids community. * The locations of these foundations will be limited to the network size and start in a few specific locations before reaching into different jurisdictions due to the additional overhead of entering a new marketplace with unique legal compliance. Maintenance The maintenance and repairs will be covered by a percentage of the rental fees across the ResiBids platform. Property upkeep will be at first maintained by the ResiBids foundation, though we may open this up to landlords in the community for specific properties based upon their reviews in the network. This system will allow hosts on other platforms such as AirBNB to have steady income by utilizing a skill they have already been recognized for, without having to put up the additional capital for expansion. Voting Every two weeks there will be a new voting period. During this voting period, every verified ResiBids user will have the ability to participate in a poll to choose one of the 10 developments to be purchased and added to the Global Housing Network. The development with the highest poll after the end of the two weeks, will automatically be added to the Global Housing Network and then listed for rent that week. * (We have elected to keep voting tied to users rather than user s network so that those who own a majority of coins won t control the network. However, those who use more coins are rewarded during voting cycles. Gold member are allowed 2 additional votes, Platinum members are allowed 4 additional votes, and Elite members are allowed 8 additional votes.) Bidding Model Centralized companies such as Airbnb and HomeAway have responded to market demand for lower cost housing solutions, and have been quite successful. Though, these companies have also leached from their customers and hosts with rates of 15% for booking and 3% for listings. This business model is nothing new, but it can be substantially improved on with the utilization of blockchain technology. The ResiBids system runs on a no-profit reinvestment model that stress upon quality for a lower price. As a result of offering the best value housing in the world, we don t believe it would be fair to host a first come first serve model. Rather, we believe in a bidding model that allows the price of rent to be determined by market demand. This model resembles the ebay bidding model, but has a few additional features. 1. Smart Bidding Smart Bidding: If a user would like to rent for the week somewhere in New York and wanted to get the best price, they could bid on 10 rental units in New York at the same time. When setting the bids, the user would have to indicate their priority of units so that they would not be stuck with 10 rental units for the same week. 2. Range Bidding Range Bidding: Unlike the traditional ebay Bidding model, ResiBids utilizes a range bidding model that allows users to bid blindly of one another within a range. Imagine Page 5 of 9

6 John is bidding on a weekend in Malibu and the most he would pay is $700, but he would love it if he could buy it for $350. So, John makes a bid for $350-$700 and then goes about his day without having to wait around glued to his computer. Jim sees the same listing and wants to bid on it, Jim can t see any of the other bids on the property, so he bids in a range that reflects his price range, $350-$450. At the end of the bidding process, all of the ranges are then compared. Jim wins the unit for $451. However, if Jim didn t bid, or if John didn t bid, either of them could have won the weekend for $ Optimal Scheduling Optimal Scheduling: If users have no preference for when they stay, rather they have a price max, they can place a rental price and place bid which allows them to automatically bid on every week until they win their set price. This mechanism works as well if the dependency is set on time rather than location. 4. AI Organization AI Organization: The ResiBids model allows users to have maximum freedom in scheduling, which may cause some headaches if someone wins a bid within the week another user is trying to schedule. Luckily, AI is here to help. Our AI organizer will order bids and group bids to make sure that the rental is most efficiently being used. For example, if John bids to rent from Wednesday to Friday for $1000 but Sally wants to rent from Monday to Wednesday for $700 and Jack wants to rent from Thursday to Friday for $500 the AI organizer would see that even though John has the highest bid/day, the time would be more efficiently used renting to both Jack and Sally for $1200. In this case the AI organizer will ask Jack if he wants to match the bid of both Jack and Sally for $1200 for the week. If yes, then he wins the week. If not, John and Sally each win their stays. Renter Guideline In order to protect the system from being bought out or influenced by a small group of individuals with large buying power, each user on the network will need to be verified before renting. Additionally, each renter can only rent three apartments concurrently. This stipulation is in place to thwart sub-letting on a listings that had been previously rented at disruptive costs. Outside the Network Hosts outside of the Global Housing Network will have the ability to utilize the previously described bidding system for their own rentals for a reasonable fee of 5% of rental income. All of the transactions will take place on the ResiBids system through the ResiCoin which will save all parties time, money, and give an accurate log of transactions for records and statistics. Other systems who would like to list housing on our network, or our housing on their network will need to comply with a set of standards held by all listings on the ResiBids platform. An additional part of the platform for ResiBids may allow developers or homeowners to sell their homes through our platform for a nominal fee. * This property auction system is not financially essential to operations so it may be nice to make this a free service in order to draw in crowds. Page 6 of 9

7 In time we will also run surveys to our community and ask if they would like participate in penny-auction style systems for home ownership. Scalability Another unique feature of the ResiBids model is its self-scalability. The scalability of the Global Housing Network is based upon a positive feedback loop. The more tenants using ResiBids, the more funds go into the growth and development of the Global Housing Network. In turn, there will be enough property to sustain the needs of the crowd. If there is a point in which demand is much greater than supply, the prices of individual units will be much greater because of the increased bidding capacity, if there are too many rentals, the price of rentals will drop in response and therefore draw in more renters. The system has been developed to seek its own equilibrium pricing rather than hold arbitrary pricing for units. ICO Details The crowdsale for ResiCoin will be based off of other crowdsale models that take place over the course of 30 days. The total dispensed coins will be 500 million starting at ETH, and going up to ETH this funding goal is quite ambitious, though as described in the following model, the more funds raised, the cheaper the price of rent for every individual on the network. We will create 500m token total, with 70% available to market. The rest of the tokens will be held from the market for stability infusions, to avoid demand bottleneck, and to reward the founders. We will distribute the token in a stage system over the course of the 30 days. We are considering a model like this, the first discount will be 50% off of the first 100m tokens, then 35% off the next 100m, 20% of the next 100m and then at the end, full price for the last 200m. Fund Allocation Funds raised from the ICO will be divided into two categories; Maintenance, and Property. There will be a 30% charge for overhead on the properties, this includes legal compliance, taxation, permits. Anything left over from this fund once all initial properties are on the market will be used to buy more property. The rest of the funding, 70% of the raise, will go directly into buying properties, installing state of the art IoT and other development costs. Additional ICOs To keep up with network demand for housing, there will be an ICO every year or 2. This allows ResiBids to rapidly expand in the case of a housing bottleneck (when demand is much higher than the supply of housing). The details of these ICOs will be determined by an algorithm that tracks the current price of the token, the demand of housing, and current volume of coin moving per day. Page 7 of 9

8 The Math Behind the Model Linear Example The ResiBids growth model is based upon the initial investment. The total available capital which can be accessed to reinvest will grow at exactly this rate. Where X is equal to the initial investment, and t is equal to time in months. ( X /150) * t At this point it, is easy to see linear growth of total apartments available to rent. Exponential Growth From Scratch This is great, but can be even better. When multiple investments are introduced, the exponential growth becomes clear. In this model, the funds are reinvested each time the cost of an apartment is reimbursed. Number of Apartments Charging ( X/150 ) per month Time Months ( t ) This model shows that there is clear and steady exponential growth in this pricing based model, and it takes less and less time to reinvest into another apartment. However, the graph also shows why individual landlords choose not to use this model. First off, it has a slow start, and two, this is a human life-time worth of waiting before apartments actually show decent returns. However, there s a way around this and it s quite simple; start with more apartments in the first month. Increased Turnover with Additional Volume Number of Apartments Charging ( X/150 ) per month Time in Months ( t ) In less than three years, this model is able to add the same amount of growth the individual landlord would have over their entire lifetime. This is why an ICO is such a Page 8 of 9

9 unique occurrence. The more money that is raised during the ICO, the quicker the expansion of the network and the lower the cost for consumers to rent. This is the main principle. Offering disruptively low priced solutions directly to the customers in an iterative way that helps the consumer rather than leaching from them. Page 9 of 9