A Reevaluation of Home Ownership

6 min readApr 8, 2022
Photo by Florian Schmidinger on Unsplash

When talking about the mission of Homebase to friends and family, I often describe the rapidly increasing housing affordability crisis and how real estate fractionalization can help solve this issue. After getting some level of agreement, that’s when I drop the hammer: “We plan on doing this via NFTs”

…and the questions start coming.

Of course, the most common question I get is “What are NFTs?” for which anyone can find a definition akin to “a non-interchangeable unit of data stored on a blockchain that can be sold and traded”. The second most common question that I am asked is “Why real estate NFTs?”. This is an important question to Homebase and, in order to understand our answer, one also must understand what an NFT is. Let’s start by breaking down the words in NFT piece by piece.

Monetized Graphics

First, let’s define “non-fungible”. While fungible can describe something that is easily interchangeable, something that is non-fungible is unique and has characteristics that give it unique intrinsic value. As a related example, a non-fungible asset you can easily think of is land. If you have 100 equally sized plots of land, one may think this land is fungible. However, land is non-fungible because of the inherent characteristics of that land, with location being the most important feature of all. Second, let’s define “token”. A token is simply defined as an object that represents something else. Putting these definitions together, a non-fungible token is a unique object that represents something else. Simple enough. But what is that something exactly and why should anyone care? While non-fungible tokens are an emerging technology, I think understanding the origin of NFTs helps to better understand the potential.

Most people in crypto agree that the first NFT was created and minted in 2014 by an artist by the name of Kevin McCoy. In 2014, Kevin McCoy and tech entrepreneur Anil Dash were paired as part of an interdisciplinary hackathon in New York City called Seven on Seven. In traditional hackathon fashion, the team took inspiration from the world at that time and proceeded to craft a solution to an issue. Seeing his content being “reblogged” by Tumblr users, Kevin wanted to find a way to offer support and protect the creations of other artists. By morning, Kevin and Anil had their product: monetized graphics, verifiably unique digital artworks represented by a record in the blockchain. Sound familiar? Although different in name, this was the very first non-fungible token, a unique object that was and is represented by something else. “Was” because this is the granddaddy of all NFTs and “is” because the names in this story may sound familiar. This is because on June 10, 2021, this NFT, Quantum, was sold at an auction for $1.4 million.

Kevin McCoy, Quantum (2014)

I did not mention this price tag to give you the shock and awe moment of someone paying an unbelievable amount of real currency on a graphic, I only mention this to speak to the maintained value that an NFT may have. You can see that at its genesis, NFTs were created to capture value for those that were unable to capture it in Web2. With the invention of NFTs, the capture of value provided a fundamental incentive layer for which others could exchange values for their own NFTs. Inherently as humans, value is what many spend their lives looking for and what everyone wants. Want is a desire to possess. So by definition, the value given to NFTs only exists because of the collective desire of individuals.

And how can one capture this value? By owning the thing that others want.

Ownership Today

The richest people in the world do not necessarily have the most dollars on hand. Instead, they own the assets with the highest perceived value by society. We verify this ownership through institutions and centralized systems and derive such value from trust in these institutions. There have been times that such trust has failed us such as the Great Crash of 1929 and the Housing Crash of 2008, where the owners of massive amounts of assets continued boosting their own value by allowing investment in risky assets and ended up causing catastrophe, to the peril of the public. Most of the time, these systems work well, but when it is bad, it is really bad.

In the current definition of ownership, ownership must be verified by existing institutions. These institutions prefer complete ownership as it provides a single place to store their liability and a level of trust for their profitability. It rewards the existing players by letting them continue their massive capture in value as previous owners have shown that they can be trusted by these institutions. It also creates artificial barriers to entry for new players. Our team at Homebase believes that technology should be enabling individuals to exercise ownership over the value they capture but in a trustless way. This concept was started by an artist and continues in the NFT space we see today.

Home is Where the Art is

Art was the perfect initial proving ground for NFTs. Whether the subject of the art is a can of soup or 16th-century royalty, whether the medium is acrylic paint or pixels on a screen, or the perspective is from afar or up close, each piece of art is unique. Art oftentimes represents something else, representing a period in a subject’s life or being a token for the emotion that someone feels for someone else. Therefore, art is both non-fungible and symbolic.

Additionally, there are pull factors for NFTs in the field of art. The art market is very lightly regulated so it makes sense as a proving ground and also suffers from existing systems that prevent the capture of value for those that actually generate the value. Artists may sell their pieces to brokers for thousands of dollars who then, in turn, sell that art, for millions of dollars, with the creator seeing none of that additional revenue. Therein lies the incentive for artists to go directly to their customers and reforge a new system in which they can capture more value. All of these factors together (uniqueness, representation, light regulation, and low-value capture for value creators) make sense for why art would be the beachhead market for NFTs. However, while art has been the proving ground for NFTs, it is not the final frontier.

Non-Fungible Real Estate

The applications for NFTs are truly endless. NFTs for watches, NFTs for cars, NFTs for companies, etc. However, we believe that NFTs for real estate have the most potential. In real estate, a plot of land and the buildings on it are owned by the legal owner per a contract. As I spoke to earlier, the land and buildings are unique in features and, of course, immovable (with some rare exceptions). Instead, the contract of ownership is transferrable by way of processes that have been around for millennia, where paper signatures are still required and centuries-old, nonsensical property requirements remain as hoops to jump through for unknown reasons other than “it’s the way it has always been”. To me, these are strong signals that real estate is ripe for technological disruption and NFTs will be that technology.

NFT marketplaces have many parallels to real estate. In my experience using marketplaces such as Opensea and Magic Eden, investors seek NFTs with many believers supporting the collection, whether that is because of the style, the meaning, or even the artists themselves. A collection is but a market for a particular set of NFTs with a shared origin, features, and history. In real estate, location is the key factor in valuing the price of the home. Why? Because you cannot change the location of the home and with this permanent feature, come all of the permanent benefits and detriments. As such, the location creates desirability, desirability creates demand, and demand raises real estate prices, behaving exactly like an NFT art collection.

On NFT marketplaces, you are able to buy and sell million-dollar NFT art with a click of a button. If price is no issue, what stops truly immutable assets like homes from being transferred in the same manner? Aren’t homes the original non-fungible token? Shouldn’t all human beings be able to own a place where their family can live and that you, as the owner, can be proud of?

So why real estate NFTs? Simply put, we believe the current system for homeownership and renting is broken. There’s an increasingly greater divide between wages and what people can afford to own with the rental market only further exasperating that model. Our team at Homebase is redefining ownership, and we believe that changing the ownership model will give a greater opportunity for everyone for generations to come.

Alex, Homebase Co-founder




We are redefining how communities buy, sell, and own real estate.