Arpit Gosain’s Post

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Assistant Vice President - Product at RealX

Removal of indexation may hasten Big Real Estate players' shift towards tokenization. With the recent removal of indexation benefits, long-term real estate investments are taking a hit. These investments were usually considered stable, but now, with higher capital gains tax, investors might look for options that are more liquid and flexible when it comes to Real Estate(which is not for residential purpose). Let me explain why I think this may happen Since there’s no more indexation benefits, holding real estate long-term isn’t as appealing. The traditional market is slow, but tokenization can speed things up and make it more attractive. Fewer people would want to invest a large amount of money in a single real estate asset if it's only for the purpose of investment. This could lead to a smaller investor base for certain property types. Here is why the big players would like tokenisation: Enhanced Liquidity: Tokenization allows fractional ownership, making it easier to trade on secondary markets, similar to stock investments. Broader Investor Base: Lower investment thresholds democratize access to high-value real estate, attracting retail investors and increasing capital inflow. Who among the big players may lead this transition? Traditional Real Estate Platforms: Platforms which already deal with fractional ownership, are well-positioned to adopt tokenization to enhance liquidity. PropTech Startups: Startups focused on innovative real estate investment solutions, are likely to embrace tokenization to offer more flexible investment options. Real Estate Developers: Large developers with significant commercial real estate holdings might explore tokenization to attract retail investors and enhance liquidity. Financial Institutions & REITs: REITs and financial institutions with substantial real estate portfolios could explore tokenization to offer new, innovative investment products appealing to modern investors. It may be too soon to predict the trend, but if the sector does not adapt and innovate soon, there will be an impact that will last for a generation. Tokenization offers a promising alternative, providing liquidity, broadening the investor base, and offering faster exit options, mitigating the impacts of the new tax regime. #RealEstate #Tokenization #Investment #PropTech #FractionalOwnership #Finance #Innovation #RealX

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Anand Sharma

Proptech I Fintech - Its Our Moral Responsibility to Become Rich.

4mo

This May Happen : As, Without the indexation benefits, holding real estate for the long term becomes less appealing - because, traditional real estate market is slow-moving, but tokenization offers a solution by speeding up transactions and making investments more attractive. The removal of indexation benefits means fewer investors will be willing to tie up large sums of money in a single real estate asset solely for investment purposes. This could lead to a reduced investor base for certain property types.

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