The History of Property and Real Estate in the Age of Blockchain

Updated: Jan 3

The modern state of real estate is often considered one of the most lucrative and secure means of flying through tax brackets in our globalized society, while still maintaining barriers to entry that demand tremendous capital or industry knowledge from hopeful investors. Both the banes and boons of the industry are something we might go so far as to call timeless.

From the invention of land ownership as a concept leading into its adoption in ancient systems of economy, land has been considered arguably one of the most valuable resources known to man. In this way, what we have in common with our ancient ancestors is a commodity more valuable than gold with a far more complicated history.

The Origins

The foundation for what we understand today as real estate, property, or land ownership began with ancient humanity’s different ties to the land. Human societies engaged in territoriality as a social formation that arose from the need to access the land and its resources with consistency. Early humans connected themselves to specific territories as the size of their social groups expanded into tribes, and later chiefdoms. These territories were an early concept of land ownership or a place that we can call our own.

For tribal peoples, this concept of ownership was exclusive to the rights to use the land and decide who could access it (usually involving members of their community). Private rights were subject to review by the group and were dropped if the land was no longer actively in use. Sale of the land was not possible with the land not being considered capital for trade or a lack of permission for trading the land. Regarding inheritance, everyone with membership to a community maintained “use rights” to the land, and members would not have to rely on someone passing away or leaving to gain access.

The Rise of Agriculture

The rise of agriculture created a greater focus on the actual development of the land. This creation of permanent settlements and new maintenance of the land changed the level of investment directed into a specific territory, acting as an early step toward our present ideas of land ownership. What is known of this time is that early farming communities oversaw land in common through a village council, a maintenance strategy still used today by peasant communities throughout the world. The growth of societies beyond tribes based on agricultural practices led to major shifts in attitudes toward the land.

Many of these early civilizations gravitated around an idea of a godlike king, in which the tribal idea of land belonging to the gods was transformed into the idea of the lands of the kingdom belonging now to the god-king. With the god-king representing the whole of the community, this idea was still a form of community land ownership, if now personified. Local customs and politics were the basis for which privileges of use and control of the land were distributed among the ruling elite within these societies. With the passage of time, land and its ownership took on a new meaning for the ruling elites. When abstracted into a form of capital, land became less of a life-bearing source of survival and more of a political tool, acting as a source of wealth and power. Social and cultural shifts took place to supplement the new drive to conquer, hold, and extract tribute from massive expanses of land.

Private land ownership as a concept was a result of these political developments around the land, both as a response to the sovereign power and the opportunities of a growing economy. In god-king societies, the privileges of the nobility were subject to retraction on a whim from the sovereign power, and political strength was widely understood as the foundation of ownership. In decentralized societies like the occasional democracies and republics of this early period, private ownership was developed in response to the breakdown of social cohesiveness as a means for nobility to guard their power and acquire greater legal recognition of their land rights. Private property elevated the political power of the individual and allowed them to act as the ruler of their land, “imitating and competing against the claims of the state”.

The Great Ownership Debate

By early Greece and Rome, strong traditions had been established in support of community common land, state or sovereign land, and private land. Plato and Aristotle were both proponents of a mixture of private and state ownership in ideal societies, with Aristotle defending the benefits of private ownership as a means of protecting social and class diversity. With the progression of history came the “great ownership debate” between the champions of private interests and the champions of the state, in which community common land was often praised as an ideal practice while gradually being squeezed out of the picture.

The world has since seen examples of these approaches to ownership carried out in practice: Feudal Europe followed a system of sovereign ownership. The rise of first commerce and then industrialism in the United States shifted power to the private ownership interests of a new middle class. In Communist countries, an interest in state ownership was renewed as the reaction against the abuses of industrialism swung public opinion at large. Throughout the history of civilization, land has been perceived and put to work as a source of power, resulting in the ongoing debate of land ownership rights between the people and the state.

John Locke and Early American Property Rights

John Locke was one of the most important philosophers of the seventeenth century for steering modern American thought regarding land ownership and its relation to the people, stating that all people are born free and equal with three natural rights: life, liberty, and the pursuit of property. His work was deeply influential for leaders of the American Revolution, as is clear from Thomas Jefferson’s inclusion of Locke’s statement into the Declaration of Independence (altered to “life, liberty, and the pursuit of happiness”). This marked the beginning of these ideas regarding property growing deeply intertwined in the American psyche with political freedom and personal success.

20th Century America

The challenges of real estate in the last century were in many ways similar to the obstacles of today: as an asset class, real estate was limited by one’s connections, social status, and capital.

During the 1800s, the majority of Americans had no way of owning a home. Unless they already happened to be very wealthy, the typical family couldn’t afford the lump sum required for payment, and banks of the time wouldn’t lend money to average people for a large investment like a home. After the US banking system was stabilized by the National Bank Acts of the 1860s, banks began experimenting with lending money for homes, and mortgages grew in popularity. The bubble burst in the stock market crash of 1929, leading to a national mortgage crisis in which banks had no money to lend and borrowers had no money to give.

As a result, the US Government went to work in stabilizing the housing market over the next several years, creating the Home Owners’ Loan Corporation in 1933, the Federal Housing Administration in 1934, and the Federal National Mortgage Association (known as Fannie Mae) in 1938. These shaped the landscape of homeownership as we know it today, and it was the GI Bill of 1944 following WWII that provided subsidized mortgages for veterans that changed the face of the housing industry and the American economy as we know it. With 20% of all single-family homes built in the twenty years following WWII being financed with the help of the GI Bill’s loan guarantee program, it resulted in what we know today as the emergence of America’s new middle class.

Innovations of Today

The current landscape of Real Estate in the 21st century is unlike anything the world has experienced before and classically simple in its core principles. Property is still a wildly valuable investment, notoriously difficult to get ahold of, and expensive to maintain. As we enter the 2020’s, technology continues to revolutionize the possibilities available in managing and attaining property for the average person. For the last decade blockchain technology has been transforming many industries, now it's time to unlock the power of tokenized (fractional) real estate investing.

Pocket Properties is one platform that exemplifies the use of innovative technology in Real Estate and property investing through tokenized ownership practices, utilizing blockchain technology, Smart Contracts, and making the information easily accessible all from the convenience of your phone or computer. Now investing is as simple as downloading an app that connects investors to their next opportunity, to the use of Smart Contracts that code the terms and conditions of ownership and streamline an infamously messy paperwork process, modern technology has created a landscape appealing to the average investor. For more information on smart contracts here is a great article from Investopedia Smart Contracts Definition (

Tokenized investing in itself is revolutionizing the housing market as a modern take on an age-old idea, challenging long-held traditional means of securing property by breaking these assets down into shares or property tokens. As a result, investing opportunities present themselves to a larger sum of people through greater affordability in investing options, and the purchase of these shares allows investors to share in partial ownership and profit. The process cuts maintenance, excessive paperwork, and complicated loan agreements out of the picture from the start for the users of this new and innovative technology! With all of these major innovations, we can eliminate those barriers that have traditionally plagued the industry for hundreds of years allowing everyone to truly be entitled to life, liberty, and the "pursuit of property".

For more information about the global history of real estate, check out this article. For those eager to start their Real Estate investing journey visit the Pocket Properties homepage.

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Chaudhuri, Joyotpaul, Possession, Ownership, And Access: A Jeffersonian View (Political Inquiry, Vol 1, No 1, Fall 1973).

Denman, D.R., The Place Of Property (London: Geographical Publications Ltd, 1978).

Institute For Community Economics, The Community Land Trust Handbook (Emmaus, PA: Rodale Press, 1982).

International Independence Institute, The Community Land Trust (Cambridge, MA: Center For Community Economic Development, 1972).

Macpherson, C.B., Property: Mainstream And Critical Positions (Toronto: Univ Of Toronto Press, 1978).

Schlatter, Richard, Private Property: The History Of An Idea (New Brunswick, NJ: Rutgers University Press, 1951).

Scott, William B., In Pursuit Of Happiness: American Conceptions Of Property (Bloomington: Indiana University Press, 1977).

Tully, James, A Discourse On Property: John Locke And His Adversaries (Cambridge: Cambridge Univ Press, 1980).

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