Real Estate Industry Starts To Embrace Cryptos For Payment
Global adoption of digital currencies such as bitcoin (BTC) as a payment mechanism increases. Bitcoin payment providers such as BitPay and BTCPay Server make it easy for anybody to use digital money to purchase a wide range of things. It includes real estate assets.
Bitcoin is being slowly adopted by the real estate sector.
The real estate industry has taken the possibilities for payment using bitcoin and other digital currencies.
For example, the United Wholesale Mortgage announced plans to begin taking bitcoin payments in August 2021. The proposal was eventually scrapped due to high costs and regulatory pressure. However, it demonstrated interest in cryptocurrencies as a payment mechanism in the real estate sector.
This was hardly the first time bitcoin and real estate have collided. In Texas, the first-ever known bitcoin sale of a family property happened in June 2017. According to the broker, Kuper Sotheby’s International, the transaction was handled by BitPay, which changed the bitcoin into US dollars. BitPay has also arranged other real estate transactions, including the 2014 sale of a Lake Tahoe home for BTC 2,739 (USD 82 million today and USD 1.6 million back then).
Many property listing sites now allow purchasers to transact directly and indirectly using digital money. Open Listings, for example, will enable purchasers to search for houses that take crypto assets such as bitcoin and Ethereum (ETH).
Buy a House Using Bitcoin (crypto-to-crypto)
Suppose you locate a seller ready to accept BTC directly for their house. You may transfer the bitcoin equivalent of the home’s price to the seller’s address once the transaction has been agreed upon and all documentation has been completed.
However, with crypto-to-crypto real estate transactions, you must struggle with bitcoin’s volatility and trust between transacting parties.
To guarantee a seamless payment, utilise an escrow firm to check that all ownership paperwork is in your hands before sending payments to the seller.
Buy a House Using Bitcoin (crypto-to-fiat)
You may even buy a property with bitcoin by changing your coins into fiat cash at the moment of sale using a crypto payment service.
Buyers and sellers may protect themselves against bitcoin price volatility by using services like BitPay, which converts the digital currency into US dollars as soon as the payment is completed.
The bulk of real estate businesses that offer homes for sale utilises a crypto payment provider to accept cryptocurrency whilst receiving cash in fiat currency.
The Advantages and Disadvantages of Using Bitcoin To Buy a House
Let’s look at the advantages and disadvantages of utilising bitcoin to buy a property.
1. Purchasing a more stable asset
Bitcoin’s value can change dramatically. Thus, when you buy a property with bitcoin, you exchange a risky asset for a less volatile asset, which may be appropriate for some investors. However, if BTC moons again, this might work against you.
2. Possible Discount
If a vendor is willing to accept bitcoin, they may offer you a discount. Discounts for bitcoin payments have grown increasingly widespread amongst firms that take bitcoin, particularly those that store the digital currency on their balance sheets.
1. Finding a buyer
It is difficult to find a house vendor that takes cryptocurrencies. Some real estate listing websites allow you to filter sellers by using phrases like “bitcoin” in your search parameters. You frequently have to contact the sellers for further confirmation.
2. Volatility in Bitcoin
Bitcoin‘s volatile pricing is a dangerous payment method for sellers who may not receive the expected value if the price decreases dramatically immediately after a transaction. As a result, some digital currency vendors prefer to accept payments in stablecoins.
Suppose you’ve made a lot of money in the crypto markets and want to diversify into other assets. Using bitcoin to purchase real estate may be an alternative for you that doesn’t need you to sell your BTC first.