Assalamualaikum - Rethinking Home Ownership the Islamic Way

Assalamualaikum, brothers and sisters. I’ve been thinking about how to make financing fit better with Islamic principles while still letting people buy ordinary homes, start businesses, etc., without taking part in exploitative practices like money debasement or hidden riba. The core issue in Islamic finance is that lenders often put up money in a currency that loses purchasing power over time, don’t directly share in asset appreciation (since they don’t own the asset), yet try to get returns that look like interest. So what general framework can we agree on to allow ordinary people to access housing and capital without involving unfair exploitation? One idea: tokenize real-world assets. Use housing as an example, though it could be applied to other things. You break a home into many small tokens or shares. Investors buy diversified bundles of these tokens - think of groups of properties in Zone X with similar values and ages, so an investor isn’t exposed to one single house’s risk (law of large numbers). I’m not a property expert, but the concept is to cluster assets by some common traits so investment is diversified. Unlike typical REITs, these tokens would represent actual ownership in fractions of the property, not just voting or profit rights. When a person wants to buy a house, they first pay a kind of occupancy payment (rent) that is distributed to token holders pro rata. As the occupier purchases tokens from the investors over time, their portion of rental payments falls, until they’ve bought all tokens and fully own the home. Pros: - No debt in the conventional sense - everyone involved is an investor. - Less intermediation; more direct link between the occupant and the owners, which should lower costs. - Islamic banks that participate wouldn’t need to treat it as a bespoke loan with high capital charges they can’t offload; this could be more competitive. - At system scale, it reduces money creation from lending, since investors are using saved capital. Savers wouldn’t be diluted by lenders creating new money. Cons: - Price volatility: the buyer may not know the exact price at which they'll acquire the remaining tokens - it will be market driven. - You need enough investors to reach critical mass for efficient pricing. Curious to hear what others think - could this be a practical, more Shariah-compliant path to help families buy homes and let businesses raise capital without falling into exploitative finance? JazākAllāhu khayran for any thoughts or practical ideas.