Cryptocurrency is becoming more widely accepted as a form of payment across a whole host of sectors. Over 100,000 merchants around the world now accept bitcoin. But can you use these online currencies to buy real estate?
It all comes down to the seller
To buy real estate with cryptocurrency the only thing you need is an agreement between you and the seller. It’s still viewed as a huge risk by many property owners, so it could limit your buying opportunities if you don't want to go down a more traditional house-purchasing route.
Bear in mind that even if your seller is comfortable with the idea, insurance, and escrow companies might not be as open to dealing with a virtual currency transaction.
Cryptocurrency is volatile
The main issue with cryptocurrency is that it’s a highly speculative form of payment, and the lack of a transparent market can make sellers nervous. After all, if they agree to sell their $1 million apartments for the equivalent amount of cryptocurrency, who’s to say that it’ll still have the same value the next morning? Traditional currency is generally more stable, so keep in mind that trading bitcoin for real estate is a gamble for everyone involved.
Cryptocurrency sales do happen
In March 2018, there were two bitcoin sales of real estate reported in NYC. They were both Upper East Side condos that exchanged hands when a single unit of the cryptocurrency was valued at around $9,000. It’s worth noting that the transactions were only bitcoin in name, as they were converted to dollars before the exchanges happened. But still, these sales prove that it’s certainly possible to trade your cryptocurrency for real estate.
Think carefully before committing
Even if the seller of your dream home is open to a cryptocurrency deal, it’s wise to consider other options before committing. Fluctuations in the valuation of bitcoin could easily mean that you could end up spending a lot more than you intended to for a property. With traditional currency that risk is significantly minimized.