Buying Real Estate With Bitcoin: Is It an Option You Should Consider?

I previously wrote about the history and development of the best-known cryptocurrency, bitcoin BTC. Bitcoin can make many transactions easier, and yes, you can buy real estate with bitcoin. In the United States, the Internal Revenue Service has classified bitcoin as a form of real property. So, in an unusual way, real estate bitcoin transactions reflect a separate layer of capital investment for tax purposes, in addition to the real, physical properties that are being bought and sold.

All that is required to use bitcoin to buy real estate is an agreement between buyer and seller to use bitcoin for the transaction. In addition, both buyer and seller should have bitcoin accounts and be familiar with how the cryptocurrency and transactions work.

You should be aware that once completed, bitcoin transactions are not reversible.

This is why buyers and sellers should not only be familiar with one another, but have a mutual level of trust. Traditional escrow companies are often not familiar with cryptocurrency transactions, and they may not have the capacity to handle a BTC or other cryptocurrency escrow. BTC and other cryptocurrency escrow services are emerging, and some may be available that specialize in bitcoin real estate transactions. The very first bitcoin real estate transaction in the U. Although a modest ranch-style home, the property was listed by its owner, former Facebook executive Chris Murphy.

A number of people with significant bitcoin holdings have been looking at buying real estate with their BTC to diversify their portfolio.

The Ripple Effects of Bitcoin on Real Estate

Properly handled, BTC transactions can be executed much more quickly than property purchases done through traditional fiat currency methods. Also, there is no need for many of the additional fees or intermediaries that can be involved in fiat currency real estate deals, so BTC transactions can be much more streamlined. This allows people to exchange cryptocurrency without involving financial institutions. There are over cryptocurrencies in use today according to coinmarketcap.

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Bitcoin is known as the first and most stable decentralized cryptocurrency in the world. As this currency is exchanged between parties, a block of information is added to a publicly viewable chain of data that keeps a record of all transactions made via blockchain technology. Ethereum is another form of cryptocurrency that uses smart contracts to complete transactions.

For instance, a smart contract will state that when a consumer pays the supplier a set amount of Ether tokens, the supplier will provide the consumer with a product or service. These transactions are also public. What Companies Support Cryptocurrencies? Though cryptocurrency is a relatively new method of completing transactions, many forms of cryptocurrency are gaining support from large corporations.

Today, more than , merchants worldwide accept this digital currency as a form of payment for products and services, including well-known companies like Virgin Airlines, Microsoft and WordPress. Joining this list is Title Partners of South Florida , which has created proven processes and procedures for accepting Bitcoin, Ethereum and other cryptocurrency to buy or sell real estate in Florida.

Bitcoin and other popular cryptocurrencies like Ethereum are being used to purchase real estate all over the world. From home services to purchases and sales, the industry is exploring various ways to use cryptocurrencies. Property buyers are now paying with cryptocurrencies while sellers have the option to accept the digital currencies directly or have them converted into USD. The power, openness and security of the blockchain are also being explored by industry stakeholders as a viable option for recording property titles and transfers during the sales process.

The use of Bitcoin, Ethereum and other popular cryptocurrencies is attracting more attention, and more buyers are now using it to purchase properties in place of cash, particularly those who are cryptocurrency investors. However, the use of Bitcoin, Ethereum and other cryptocurrencies by title companies and other vendors involved in a real estate transaction is still very uncommon.

The Bitcoin Guide to Real Estate

In fact, very few title companies have the experience and understanding of how cryptocurrencies work. As a peer-to-peer electronic monetary system without a central regulatory body, Bitcoin has become the most popular cryptocurrency. Due to its wide acceptance, the currency has seen many states craft legislation for tax purposes and refer to it as a digital property or a commodity. We at Title Partners of South Florida strongly suggest you consult with your CPA or accountant prior to buying or selling real estate with Bitcoin, Ethereum or any other cryptocurrency.

All Bitcoin transactions are encrypted. To initiate a real estate transaction with Bitcoin, you need to have a digital wallet.

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You can typically fund it with PayPal or your credit card through a mainstream Bitcoin broker. However, some banks and credit card companies have banned their users from making transactions using cryptocurrencies like Bitcoin. There is much speculation as to why this may be happening, including possible concerns from banks about liability and disruption in their industry.

Before choosing to fund a digital wallet, be sure to check with your financial institutions to ensure all financial transactions will go smoothly. How to Buy a Home With Cryptocurrency Regardless of whether you are buying or selling a home using fiat currency or if a cryptocurrency like Bitcoin or Ethereum is an acceptable form of payment, you should begin every real estate transaction armed with the knowledge and understanding you need about the home buying or selling process. Speak with a real estate agent, financial advisor or other professional to be as educated as possible.

Bitcoin Basics for Real Estate Agents in 2021 (+ Expert Predictions)

You may also call Ryan Phillips, President at Title Partners of South Florida at to discuss the title and closing processes, as well as how to complete real estate transactions with cryptocurrency. It seems implausible to sell a high value commodity — a property, using a currency whose value is so volatile. To tackle this obvious issue, vendors who are marketing their properties in Bitcoins state that the Bitcoin price will be determined by the average exchange rate on the day the sale closes. Assaad Fakhry.

How Bitcoin Deflates Luxury Real Estate

Your email address will not be published. The Bitcoin Guide to Real Estate. No Comments. Bitcoin, a digital currency, has received a flood of media attention due to its meteoric rise in value.

Bitcoin and the Real Estate Industry - Cumberland Title Company - Cumberland Title Company

What is Bitcoin? Bitcoin involves some form of incomprehensible computer coding, cryptography and mathematics. Can you buy a house with Bitcoin? Buying property with Bitcoin is already a reality.

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Cons of using Bitcoin in Real Estate But using a crash-prone currency to conduct real estate business seems to be high risk. Closing thoughts on Bitcoin and Real Estate Tellingly, no properties have yet been sold in Bitcoins but never say never.