The United States on the other hand has a massive title insurance industry, which wouldn't exist if this system was implemented. So you can make random handshake agreements all you'd like and sue over it.
[1] https://www.elra.eu/the-principles-underlying-the-land-regis...
Sort of. The registration is what provides opposability against third parties. But between buyer and seller, the transfer of ownership happens by the contract itself. You'll have a harder time against creditors of the seller placing liens on the property, or other people claiming to be owners (e.g. if they bought the foreclosed property); how hard a time depends on the country.
And there may be still be encumbrances/claims to the property that are not subjection to registration like adverse possession or rental agreements that can be asserted against the buyer and for which the buyer's only option is to sue to the seller.
ADDED: We also had a bunch of easements and cooperative maintenance agreements that were only partially documented in the deed and mostly done via a handshake. So we got that all squared away in the expensive binder from the lawyer.
In his thesis, this is the reason capitalism cannot work well in Latin America and other nations around the world. He says that registered land ownership is the foundation of capitalism. This is how one can borrow money against your land and invest it to make more capital. Very common for example with farmers in N. America to borrow against their farm, for machines, seeds and fertilizer.
(I am not an economist)
De Soto is talking about why it "cannot" get started in a place without government controlled land registry.
De Soto describes the exact opposite situation. Latin America inherited Napoleonic property law, which only recognized property ownership when formally registered, which required quite alot of red tape. It was impossible to transfer ownership without registration. Moreover, any defect in prior registration meant the lawful owner might be the heirs of someone generations ago. Most property "owned" by the peasantry usually had defective and incurable title, having changed hands in informal private agreements, which meant banks wouldn't accept it to secure a loan. This meant only the aristocracy could leverage the financial system, because they were accustomed to following all the formalities. What piece of real property someone thought they owned, even if occupied for generations, was often in the eyes of the law owned by some aristocratic family or the state.
He contrasted that system with the American common law system, where title could be legally transfered entirely privately. Disputes are handled by courts which look to the timing and substance of transfers. Moreover, adverse possession meant that after a number of years (well within one person's lifespan) nobody could come along and claim title because of a defective transfer (even if in principle they had a better claim originally), securing title in whomever held it, even if it had been transferred without even following the much looser requirements under the common law. A bank would issue a loan so long as you could prove you held an unchallenged title for a sufficient number of years. ("Title" was whatever piece of paper handed you by the previous possessors; no government stamp or recordation required.)
Registration systems in the US are a recent occurrence, and they overlay the traditional common law rules.
A gross generalization, but Napoleonic civil law systems emphasize formal transactions centrally administered by the state, while the common law emphasizes looking to the substance of private transactions, and usually only when a dispute arises (otherwise you just presume they're valid). Broadly speaking, De Soto argued the latter tended to favor the common man, because it was much less rigid.
De Soto also pointed out that US Federal Land Grants also did a decent job at distributing land among the people, unlike Latin America where mostly only the aristocracy held land under a good title.
"Cannot work well" and "cannot get started" are two different things. The whole of Latin America apart from Cuba is capitalist, for better or worse, regardless of how bad those countries keep their books.
And yes I can see that we are at the end of an era. This may be more the end of the U.S. empire than the elimination of capitalism, but for sure a new 'ism" is going to be required soon. What that is will be interesting to see. It would be nice to see someone with imagination come along instead the bipolar options we are handed today.
"i paid for 30 acres here at $xx rate, and here is the mortgage docs from the bank dated March 19th that I signed, plus their valuation of the property and what went into it"
(And obviously has some doc to prove it)