The acceptance of digital currencies like Bitcoin (BTC) as a method of payment continues to accelerate around the world. Bitcoin payment providers such as BitPay and BTC Pay Server facilitate the purchase of a wide range of goods, including real estate, with digital currency.
Read on to find out how to buy a house with bitcoins.
The real estate market is (slowly) adopting Bitcoin
The real estate market has become aware of the possibility of using Bitcoin and other digital currencies for payments.
For example, in August 2021, the United Wholesale Mortgage announced a plan to start accepting bitcoin payments. Although the plan was later scrapped due to high costs and regulatory pressure, it demonstrated interest in cryptocurrency as a payment method in the real estate market.
This wasn’t the first time that crypto and the real estate industry had “collided”. In June 2017, perhaps the first-ever known homestead bitcoin sale took place in Texas. According to the broker Kuper Sotheby’s International, the transaction was processed by BitPay, which converted the bitcoins into US dollars. BitPay has also handled other real estate transactions, including the sale for 2,739 BTC ($82 million today and $1.6 million then) of a property in Lake Tahoe in 2014.
Currently, many real estate listing sites allow buyers to transact directly and indirectly using digital currencies. Sites like Open Listings allow buyers to search for properties that accept cryptocurrencies like bitcoin and ethereum (ETH).
How to buy a house with bitcoins (crypto to crypto)?
If you find a seller who is willing to directly accept BTC for their property, you can transfer the bitcoin equivalent of the house price and send it to the seller’s address once the sale has been agreed and all documents have been signed.
However, in crypto-to-crypto real estate transactions, you will have to deal with the volatility of Bitcoin and the trust between the parties involved in the transaction.
To ensure payment goes smoothly, it is best to use an escrow service so that all ownership documents are in your possession before releasing the funds to the seller.
How to buy a house with bitcoins (fiat currency crypto)
You can also buy a house using bitcoins by converting your fiat money (euro, dollar…) at the time of sale using a crypto payment provider.
Through services like BitPay, buyers and sellers can protect themselves from fluctuations in the price of Bitcoin, as the digital currency is exchanged for US dollars as soon as payment is made.
The majority of real estate companies that list properties for sale use a crypto payment provider to accept crypto-assets but receive funds in fiat currency.
Read also: RealT: Tokenizing real estate, one token at a time
Advantages and disadvantages of buying a house with bitcoins
Let’s take a look at the pros and cons of buying a home with the first of the cryptocurrencies.
Advantages
Acquire a more stable asset
The value of Bitcoin can fluctuate very significantly. Therefore, when you buy a house using bitcoins, you are exchanging a volatile asset for a less volatile asset, which may be the right move for certain types of investors. However, this can backfire if Bitcoin soars again.
A potential discount
If a seller agrees to receive bitcoins, they may offer you a discount. Offering discounts to people who pay with bitcoins has become quite common among businesses that accept bitcoins, especially those that hold this digital currency on their balance sheets.
Disadvantages
Find a seller
Finding a home seller who accepts cryptocurrencies is not an easy task. Although some real estate listing sites allow you to filter sellers by adding words such as “Bitcoin” to your search parameters, you often need to contact sellers for additional confirmation.
The volatility of Bitcoin
The fluctuation of bitcoin price makes it a risky payment option for sellers, who may not receive the value they expected if the price drops sharply soon after a transaction. Therefore, some sellers who accept digital currencies prefer to receive payments in stablecoins.
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To invest in cryptocurrency mining or masternodes:
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- In poker on the CoinPoker gaming platform
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