actually my current rental contract somewhat resembles this idea: I paid 3x of rent price initially (for the first, last month of rental (whenever it might happen) and collateral for possible damage).
Where btc contract might fall short is if property damage is too massive to be covered by collateral they can appeal to authority with normal contract so it might not be that good here.
I invite you to imagine a scenario beyond normal authority as we know it. Say a freecity, where smart contracts such as this are regulary entered.
Its a really elegant solution. If catastrophic levels of intentional damage are a risk, i would assume a property owner could request an arbitration agrrement. In unintentional circumstances it would be insurance's problem.
This really is the sort of thing i saw arising out of bitcoin. Something went wrong ten years ago.
I don't think authority is a bad thing, it's itself is quite an efficient way to enforce contracts.
In fact, increased liquidity requirements in Trouble is a price for not having an authority around.
Generally, a more liquidity-efficient solution tends to win so I think Trouble is only usable in edge cases (too powerful or anonymous counterparty for example, something unenforceable in standard way).
