Cryptocurrency has proven to be resilient over the past decade, something that has attracted the interest of both institutional and retail investors. Cryptocurrencies like bitcoin have become much more than risky investments and are being used to make payments in a wide range of industries.
Over 18,000 businesses globally are accepting bitcoin payments. The global acceptance of bitcoin has seen bitcoin being used even in the real estate industry to buy homes.
How can you buy a house using bitcoin?
A house can be bought with bitcoin, provided the buyer and the seller agree to it. There also needs to be escrow companies and title insurance that can accept bitcoin transactions instead of fiat currency.
While there haven’t been so many crypto transactions in property sales, it is possible, provided the two conditions are met.
Steps for buying property using bitcoin from real estate companies like Italiaproperties:
- Choose the house
Buying a house with crypto begins with the first and critical step: choosing the property to buy. In this stage, consider all the essential factors to get the ideal house, such as the location, structural integrity, and property value.
- Agree on the payment terms
Before getting to this stage, ensure the property seller and escrow company handling the transaction can accept bitcoin payment. Some property companies help clients convert crypto to fiat currency and vice versa. It is essential to know if the company can support converting the crypto, especially if the buyer wants to receive the payment in fiat. If the buyer is interested in holding the crypto payment, this will not be necessary. Negotiate and agree on the payment terms and other issues regarding the house.
- Make payment
Once the terms have been settled, make the payment by sending the crypto to the company via the provided crypto address. The company will then convert the bitcoin to fiat currency at the current market price. Most property companies will give you the freedom to choose when to convert the crypto once they receive the payment in their crypto accounts. This will allow you to take advantage of the exchange rate.
- Seller received the payment
Once converted, the company will send the payment to the seller in fiat. Once the seller receives the payment, you will get the property’s title.
What are the benefits of buying a house in bitcoin?
- Increased property acquisition speed
One of the benefits both sellers and buyers enjoy from crypto transactions is speed which is synonymous with cryptocurrency transactions. The removal of intermediaries and the electronic nature of crypto transactions make the buying process much faster.
- You might enjoy a discount
While it is not a guarantee, it may be easier to request a discount when making the payment with bitcoin. If the seller can accept crypto payment, they are likely to be crypto investors who understand cryptocurrency dynamics. Knowing that the value of the crypto will be increasing with time, they are more likely to warm up to the idea of giving a discount.
- The process of buying the house will be less costly
Intermediaries come with increased costs. The elimination of intermediaries in transactions is among the things that make cryptos attractive. You will enjoy a lower transaction cost and other service charges associated with intermediaries by paying via bitcoin. More so, you will avoid the daunting task of engaging third parties. Note, however, that you have to pay the crypto’s blockchain network fee to execute the transaction.
- Transactions are secure
Cryptocurrency transactions are safe. People can make payments to the property company without revealing sensitive information such as their account number. While sending payment to the seller, the transaction will be anonymous and man-in-the-middle attacks that threaten your password and account details, as in the case of bank transactions.
More so, bitcoin is not a physical currency. Therefore, thieves cannot get their hands on your money. Provided your private keys to your bitcoin wallet are safe, no one can get their hands on the funds. While there have been reported hacking traditional bank accounts, the security on bitcoin exchanges is less prone to such attacks.
What is the future of cryptocurrency in real estate?
It is important to note that not all sellers are willing to take payment in cryptocurrency. Also, it is worth noting that most sellers will accept popular cryptocurrencies such as bitcoin.
While it is possible to buy a house with bitcoin, it is essential to note that most of the payments will be ties to fiat currency since the bitcoin prices are always subject to change. The benefit, however, is this can earn you discounts when making payments.
The crypto market is growing, and its application in the real estate market continues to expand. Smart contracts are also being used in real estate to ensure buyers and sellers fulfill their obligations in their agreements.