I guess that would depend on whether and how key signing by the owner is incorporated into the system. The way I imagine it working is, when purchasing a property you can (optionally?) cryptographically sign the document, probably with a hardware wallet that you would then keep in a safe somewhere. The hardware wallet contains the private key, the public key is added to the document which would be further signed by the notary in the same way before being put on the blockchain. You can then do things like sign listings for selling the property to prove to prospective buyers that you are the current owner (they can verify that your signature matches the key on the document, and the document is also signed by a known authority), and sign documents for selling it with your key.

If the key is lost, then in order to sell the property you would probably have to go through some kind of correction process, and an updated document with the new key/signature or that says a key is no longer being used, and has a reference to the old document it's superseding, is put on the blockchain. Probably this process should involve extra scrutiny about your identity. If it's stolen and the thief starts using it, I guess same thing plus legal proceedings, but there should be systems to automatically notify you in various ways if anything is happening (and if the documents are on the blockchain, you can even poll for these notifications yourself without relying on any government servers). If you die and the key is lost, same kind of deal, correction process with a new document uploaded. Actual enforcement in practice of a valid signature being required could mostly be automatically handled by websites for real estate listings; if the latest document says the owner's cryptographic signature is required for sale, that signature could also be required to even make the listing.

Validity of notary keys would be a little trickier, but you could have something like a hierarchy of keys that sign metadata about which lower level keys are valid for which time ranges and which of their transactions have been revoked. If the highest level key in the hierarchy is compromised, a new one gets issued and the event is communicated to the public through official channels so everyone can update all their software to use the new one and ignore the old one. Because this is a possibility, and because anything recorded could be superseded by a correction, this type of system would not be suitable for other smart contracts to interact with directly, so unlike something with NFTs you wouldn't easily be able to trade properties on DeFi markets (which for previously mentioned reasons and others I don't think would work well anyway).

My own experience with the process of buying property was that it's pretty sketchy; most of it happened remotely, and the main way I had of confirming that the deal was legit as advised by my real estate agent was, iirc, stuff like that the title company's website was highly ranked on google and had a domain name with few letters and listed their phone number, but these things are not a hard guarantee. I do think there is room for improvement.