Asymmetric Information in High-Value Low-Frequency Transactions - Mitigation in Real Estate Using Blockchain.

The saying `buyer be aware' has been used as an excuse from a seller's perspective to withhold information that could negatively impact a transaction. This asymmetric information is especially prevalent in high-value, low-frequency assets. Using New Zealand real estate as an exemplar to understand the difficulties faced in such a transaction, we delve into the characteristics of the transaction and specifically the asymmetric information that is predominant in the real estate industry. Understanding the processes and stakeholders involved gives us the possibility to introduce blockchain as a system to mitigate asymmetric information. We identify the bottlenecks in the current processes and suggest possible solutions that capitalize on the blockchain characteristics.