Cryptocurrency is becoming more mainstream with a lot of retailers now offering this as a payment method for goods. This leads a lot of people to consider whether or not they will be able to purchase real estate with cryptocurrency. If you are one of these people, there is a lot of information that you need to know about this and consider before you attempt to buy a house with cryptocurrency. For example Edge Wallet supports Stellar coin.
The Seller Needs To Agree
The first obstacle that you could face with this purchase is getting the seller to agree. There are a lot of sellers who are not willing to accept cryptocurrency as payment for their home for a number of reasons. They might not understand the currency or they might be wary of the volatile price which could mean that they get less than their asking price.
Fortunately, there are a lot of sellers who are open to cryptocurrency transactions. These sellers will generally state this in their house listing. There are some services that you can use to help you find real estate where the seller is willing to accept cryptocurrency.
The Title And Escrow Companies Have To Agree
A lot of people assume that finding a seller willing to accept cryptocurrency is the hard part. While this can be a challenge, the real issue comes when you need to get the title and escrow companies on board. After finding a seller and agreeing to an offer, you have to find companies that are comfortable handling these transactions.
The problem is that most companies will not complete cryptocurrency transactions for real estate purchase. In most cases, you will have to cash out the cryptocurrency and have the sale treated like a traditional house purchase. If you need to do this, you will only be cashing out the agreed upon amount of cryptocurrency and not the exchange rate value.
Consider The Exchange Rates
When you look at buying with cryptocurrency, you need to consider the exchange rate. All of the real estate listings that accept cryptocurrency will have the list price of the house in dollars. This can be very helpful when you are looking for a property, but could be an issue when it comes to making the payment.
This is due to the volatility of the cryptocurrency market. Bitcoin is the most commonly used currency for real estate transactions, but it is also very volatile gaining and losing value every hour. If the property that you want to buy costs $200,000 you will initially buy this amount in cryptocurrency or ensure that you have enough to cover this.
However, when it comes time for the transaction to go through, the cryptocurrency you have may not be enough. This means that you will need to buy more currency which will actually increase the costs of the property. Of course, it is important to note that this shift in value can also go the other way resulting in you not needing to spend all of your currency on the transaction.