OpenLand enables the digitisation of physical properties, allowing multiple people to buy landed properties in fractions, and trade these fractions as commodities on the blockchain.
This way, we are lowering the barrier to entry in the real estate market, making property ownership more accessible to individuals, and generating economic value from landed properties, thereby allowing real estate owners earn passive returns on their properties through the concept of Herberger Tax.
On OpenLand, verified land owners can upload details of their properties for sale and set a floor price. After verification, the property ownership rights are encoded on the blockchain and minted as a digitised NFT. Based on the land’s total number of square meters, this NFT is split into an even number of fractions, where 1 fraction is equal to a number of square metres.
When each fraction is purchased, each buyer is automatically placed in a DAO that has decision making power on the property.
After purchasing the property at the floor price, Buyer A is allowed to value their property at any price they want, and set the price at that value. To prevent price fixing and hoarding, the “Harberger tax” principle is applied.
Firstly, when setting the new price, Buyer A is required to pay a 20% tax of the new price (80% goes to the property owner, and 20% goes to OpenLand). Secondly, the property can be bought by anyone else at the price set by Buyer A, thereby forcing a sale. This way, the property is in the most productive hands at every point in time, thus preventing hoarding.
In the event where someone is interested in buying off large fractions of the land, members of the DAO can vote to contribute their fractions to the bidder’s buying pool, until the fractions make up the full
To build the OpenLand platform we would be making use of
Moralis Software and API’s to enable us scale quickly.
IPFS Decentralized file storage to store NFT images and Metadata
With the help of Moralis we will efficiently be able to handle User login system, User session management and connection/interaction with IPFS.
The NFT Smart contract is written in solidity version 0.8 with the help of OpenZeppelin Library for the purpose of extending the ERC1155 Contract library
The OpenLand platform will be deployed on the Polygon network because of its faster transaction speeds that are also at a lower cost than on Ethereum or BSC.