- 5 min
Real Estate Tokenization Is Changing the Way You Invest in Indian Property
Written by
Kashish Manjani
- Blog
- Financial Planning
Date
10 Oct 2025
Kashishmanjani
@Kashishaikeyam
YouTube
Kashishaikeyam
Here’s a wild idea: What if you could own a piece of a Bangalore apartment for ₹5 lakhs—and sell it in 5 minutes when you need cash?
No brokers. No paperwork. No months of waiting.
Sounds impossible? It’s called real estate tokenization, and it’s closer than you think.
The Real Estate Problem
You know the drill.
Want to buy property? You need ₹50 lakhs minimum for anything decent. That’s your entire savings. No diversification. All eggs in one basket.
Want to sell? Wait 6-12 months. Negotiate with buyers. Drown in paperwork. Pay hefty brokerage.
Want liquidity? Ha. Good luck selling half your flat when you need emergency cash.
And if you’re an NRI? Add: flying back twice, Power of Attorney chaos, FEMA forms, and repatriation nightmares.
There has to be a better way.
What Is Tokenization?
Simple analogy:
You buy 10 Reliance shares. You own a tiny piece of Reliance.
Now do that with buildings.
A ₹100 crore building in Bangalore gets divided into 10 crore digital tokens. Each token = ₹10.
You buy 50,000 tokens for ₹5 lakhs. Boom—you own 0.05% of the building.
What happens next?
- Rent: Auto-credited monthly. Your exact share.
- Want to sell: List your tokens on an app. Like stocks. Done in minutes.
- Paperwork: Zero. Ownership lives on a blockchain (fancy digital ledger).
You just invested in real estate. No brokers. No illiquidity. No nightmare.
How It Works
Step 1: Developer picks a property (commercial building in Mumbai, say).
Step 2: Property goes into an SPV (Special Purpose Vehicle)—a company that owns only that building.
Step 3: Property value divided into tokens on a blockchain. A smart contract (automated code) handles rent, transfers, everything.
Step 4: Tokens listed on a platform. You buy them like you’d buy stocks on any stock broking app.
Step 5: Need cash later? Sell tokens. Another investor buys them. Instant transfer.
No stamp duty. No registration. No waiting.
Old Way vs. New Way
| Old Way | Tokenization |
|---|---|
| Need ₹50 lakhs minimum | Start with ₹5 lakhs |
| Takes 6–12 months to sell | Sell in 5 minutes |
| One property, one city | Five properties, five cities |
| Chase property managers | Auto-credit monthly |
| Stamp duty, registration, brokers | Digital, instant, zero paperwork |
| Stuck with the property | Exit anytime you want |
Not an upgrade. A different game.
A Real Example
Property: Office building in Whitefield, Bangalore. Worth ₹200 crores. Rent: ₹16 crores/year (8% yield).
Old model: Only ultra-rich can play. Minimum ₹10 crores. Totally illiquid.
Tokenized model: 20 crore tokens at ₹10 each.
You invest ₹10 lakhs. You get:
- Monthly rent: ₹66,000
- Sell anytime on the platform
- Value rises? Your tokens rise.
And here’s the kicker: You never visit the property. You never deal with tenants. You just get your share of rent every month.
The Big Money Is Moving
Here’s a number:
Institutional investors will put 7-9% of their portfolios into tokenized assets by 2027.
That’s pension funds. Family offices. Sovereign wealth funds.
The same allocation they give gold.
And within tokenized assets? Real estate ranks #2 (after private equity).
Why? Because it’s not crypto speculation. It’s real buildings. Real rent. Real value.
When the smartest money moves billions, it’s not an experiment. It’s a trend.
Commercial vs. Residential
When Indian tokenization launches, you’ll see two types:
Commercial (offices, malls):
- Stable rental income (6-9% yield)
- Long leases (3-9 years)
- Higher entry (₹10-20 lakhs likely)
- Best for: Passive income seekers
Residential (apartments, villas):
- Capital appreciation focus
- Shorter leases
- Lower entry (₹5-10 lakhs)
- Best for: Growth seekers
Pick based on your goal. Diversify later.
Is This Even Legal?
Not fully in India—yet. But things are moving:
Globally:
Europe: MiCA regulation passed December 2024. Tokenized real estate is now as legal as mutual funds.
Luxembourg: Blockchain Law IV (Dec 2024) explicitly legalized tokenization. They already have live projects—luxury buildings owned fractionally by international investors.
Dubai: Official tokenization project launched. Investors can already buy fractional Dubai properties.
USA: Platforms like RealT let you buy tokenized US homes for $50. Weekly rent. It works.
In India:
GIFT City: Running blockchain pilots in a regulatory sandbox. Real money. Real transactions.
SEBI: Watching hard. No guidelines yet, but studying MiCA, Dubai, and GIFT City closely.
REITs first: Tokenizing existing REIT units is simpler than individual properties. Expect pilots in 12-18 months.
Digital rupee: RBI rolling out e-₹. Perfect bridge for tokenized transactions.
Timeline: 12-24 months to regulated mainstream tokenization in India.
When Can You Invest?
Best guess:
Late 2025: SEBI draft guidelines. Public consultation. GIFT City pilots expand.
Early-Mid 2026: Final rules. First licensed platforms. You can buy tokenized REITs or commercial properties.
Late 2026-2027: Residential tokenization starts. Multiple platforms live. Secondary market improves.
By 2028: Tokenization is normalized.
Not tomorrow. Not a decade away either.
Which Platforms to Watch
When Indian platforms launch, check:
Licensing: SEBI/IFSCA approved?
Property quality: Grade-A or speculative?
Fees: Platform fees (2-5%), management fees (1-2%), exit fees?
Study these now (for learning, not investing):
- RealT: US properties, $50 tokens
- Blocksquare: European residential
- RedSwan: Institutional commercial
Understanding what good tokenization looks like helps you evaluate Indian platforms later.
The Tax Problem
Big question: How will tokenized real estate be taxed?
Nobody knows.
Will it be:
- Property (20% long-term capital gains)?
- Securities (10-15% like stocks)?
- Something else entirely?
SEBI and tax department haven’t clarified.
What this means:
- Don’t invest blind
- Hire a tax specialist who understands digital assets
- Assume worst-case tax rates when calculating returns
Once regs are clear, platforms will handle compliance automatically. Until then, get professional help.
Who Benefits Most?
Young professionals (25-40): Instead of locking ₹50 lakhs in one property, diversify ₹10 lakhs each across five tokenized properties. Better risk management.
Mid-career investors (40-55): Already own one property? Add tokenized assets for diversification without the hassle of managing multiple physical properties.
NRIs: The dream scenario. Invest in India without flying back, without brokers, without repatriation nightmares.
Retirees: Need monthly income? Tokenized commercial properties with stable tenants = predictable cash flow without tenant management headaches.
What to Do Now
1. Stay Informed
Google Alerts:
- “India real estate tokenization”
- “SEBI blockchain guidelines”
- “GIFT City tokenization”
Follow fintech news. Watch for SEBI moves.
2. Prep Your Setup
Get ready before launch:
- Active bank account with net banking
- Aadhaar linked to PAN
- Demat account (platforms might use this infrastructure)
- Digital comfort (apps, e-signatures)
3. Plan Allocation
Tokenized real estate: 5-10% of your investment portfolio
Example (₹50 lakhs):
- 40%: Safe (FDs, bonds, debt funds)
- 30%: Equity (stocks, mutual funds)
- 20%: Traditional real estate (if you can afford it)
- 10%: Tokenized real estate (when available)
Start small (₹5-10 lakhs). Learn. Scale up.
4. Build Your Advisory Team
You need:
- SEBI-registered financial advisor (understands regulations + digital assets)
- Tax specialist (can navigate new asset class taxation)
Find them now. Don’t wait until you need urgent help.
The Risks
Let’s be honest:
Regulatory: What if SEBI’s rules are restrictive?
Tech: Smart contracts can have bugs.
Liquidity: Obscure properties might be hard to sell.
Platform: What if it shuts down or gets hacked?
Property: Bad tenants = bad returns. Tokenization doesn’t fix that.
Mitigation: Wait for final regs. Use licensed platforms only. Check security audits. Stick to premium properties. Diversify.
Why Care Now?
Because early movers win:
- Best assets get tokenized first (tech parks with Google as tenant, luxury complexes)
- Early platforms offer better terms (lower fees, higher yields)
- You learn the system when stakes are low
- By 2028, you’ll have years of experience while others scramble
Wait until everyone’s talking about it? You’re late.
Prepare now? You’re positioned for the best opportunities.
The Bottom Line
Tokenization won’t replace traditional real estate.
But it offers something new:
Liquid, fractional, transparent real estate you can buy from your phone.
No brokers. No year-long waits. No ₹50 lakh minimums.
India’s 12-24 months away. SEBI’s watching. GIFT City’s testing. Global precedents exist. Institutions are allocating billions.
Your move?
Stay informed. Get ready. Watch for launch.
Because when it happens, real estate investing will never be the same.
Need Help Navigating This?
Tokenization is exciting. But it’s also complex—tax implications, platform evaluation, portfolio allocation, regulatory compliance.
Here’s where we come in.
We’re a team of SEBI-registered investment advisors who help investors build smart, compliant, future-ready portfolios. Whether you’re exploring tokenized real estate, traditional investments, or a mix of both, we can help you:
✓ Understand tax implications and optimal portfolio structure
✓ Evaluate platforms when tokenization launches
✓ Navigate emerging opportunities without getting burned
✓ Plan for long-term wealth creation across asset classes
For NRIs specifically: We handle FEMA compliance, TDS optimization, DTAA benefits, and repatriation planning.
Written by
Kashish Manjani
Kashish blends strategic thinking with timeless financial principles — helping clients grow, protect, and align their wealth with their values. Kashish blends strategic thinking with timeless financial principles — helping clients grow, protect, and align their wealth with their values.