Tokens could either be issued for existing real estate or for a real estate project under development.
Private homeowners could issue fractional tokens of an apartment they want to buy, which would allow them to raise funds without needing to go through a bank or take out a private loan. The token holders would be co-investors and could collect fractional rent in proportion to the amount of shares they hold.
People who were previously excluded from such investments for economic reasons could now invest in only a fraction of a whole unit, which would make the market more inclusive to those who have less economic means.
Rent collection is administered by the smart contract and ownership is more easily transferred. If, for example, another person buys 5 percent of the tokenized value of your apartment, proportional rent could be paid out on a monthly basis automatically by the smart contract.
In the case of a sale of the apartment at a future date, fractional token holders of that apartment could get their money back, which might also be automatically managed and enforced by the smart contract.