A trial of blockchain involving the digital transfer of property ownership has been completed by HM Land Registry, but the agency has no plans to adopt the emerging technology itself any time soon.
A Land Registry spokesman confirmed that its Digital Street project had successfully tested a prototype blockchain as a means of speeding up the conveyancing process in a transaction on a house in Gillingham, Kent.
However, it was simply a “proof of concept” to ensure the registry was up to speed with the potential of distributed ledger technology.
Now in its second year, the Land Registry’s Digital Street project has given itself a long time window – until 2030 – to familiarise itself with likely technologies the front-runners in the conveyancing industry might adopt.
The spokesman said: “We wanted to work with the industry to make sure that we understood how forms of the blockchain network could work to benefit the industry as a whole.
“We’re looking to take all we have learned from this successful test and discuss it further, internally and with members of the Digital Street community – which is comprised of regulators of conveyancers, mortgage lenders, and technologists.
“It was more to look at emerging technologies [rather] than technology we could currently use. It’s making sure we are ready for the property market of the future.”
He added: “Land Registry is often cited as a potential use case of blockchain, so we thought we should be doing thorough due diligence [and] seeing what it can actually bring to the property market in the UK.
“An important part of that is working with the market to make sure they agree with our approach.”
He pointed to real-world changes consistent with the Land Registry’s digital transformation agenda, a key part of which is taking over the land charges system from local authorities and creating a single digital register.
The registry’s digital mortgage service ‘Sign your mortgage deed’ – which has just had its first anniversary and enables mortgage applicants to prove their identities using the government’s gov.uk verification gateway – was now in use by some 17 banks, including Natwest, HSBC and Santander, he said.
The Land Registry was interested in improving the speed of property transactions, even if it did not see the need to lead the market.
“We absolutely want to make sure we are keeping pace with those who are disrupting the industry, to make sure we understand the technology and how it can interact with the Land Registry’s services.
“We are keen to make it simpler faster and cheaper for everyone involved to transfer property… It’s at the heart of our business strategy.
“We fully believe that technology can be used to improve the speed and reduce the cost, and part of the blockchain project is reducing the uncertainty around buying a house and not knowing who the next person is to act.”
He highlighted the support provided to the Digital Street project by London law firm Mishcon de Reya and leading volume conveyancer MyHomeMove.
Mishcon’s chief strategy officer, Nick West, added: “It is clear that, as it stands currently, real estate transactions are too slow. This affects buyers and sellers, particularly where transactions fail or are abandoned and at great cost.
“Technology, and especially blockchain, coupled with improved data management has a huge part to play in revolutionising this process. What’s exciting here is that this is a real world application of blockchain technology in our legal market.
“If we can turn this proof of concept into reality it will be of significant benefit to anyone buying or selling real estate assets in the UK.”