Pros and Cons of Purchasing a House with Bitcoin

Bitcoin adoption is still in its infancy, but many leading firms have already integrated it into their portfolios as an investment and payment method. Even local realtors have picked up the trend, allowing property buyers to pay in Bitcoin and other cryptocurrencies. Experts predict crypto will play a significant role in future real estate transactions.

Nevertheless, buying a property with Bitcoin has unique advantages and disadvantages that you should know before deciding. Here are the main merits and demerits of investing in real estate with Bitcoin.
Pros of Buying Property with Bitcoin

Profitable Diversification
Every savvy investor knows it is never a good idea to put all your eggs in one basket. Buying a house with Bitcoin enables you to diversify your investment portfolio with fewer financial risks. Unlike Bitcoin, whose value constantly shift based on public perception, real estate value appreciates over time. Thus, buying a house using Bitcoin can be a great way to diversify your investments, with prospects of higher returns. Besides, property sellers increasingly accept crypto payments, meaning using Bitcoin would also give you a competitive edge over other buyers offering cash or bank transfers.

Secure Investment Instrument
Investing in real estate can be risky, especially for new investors who do not understand the industry. Even though relying on financial institutions and lawyers might seem like a safe option, it could still expose your investment to several risks. Bitcoin is a secure investment instrument because of the blockchain’s security and transparency guarantees.

Most people only use Bitcoin to send and receive payments currently but, it would also allow the electronic processing of paperwork such as title deeds. The network permanently keeps all the records on an encrypted public ledger, offering safe and transparent proof of transactions. That would eliminate the common disputes between property buyers and sellers.

Reduced Transaction Costs
Conducting real estate transactions in Bitcoin means both the buyer and seller must have a digital wallet to send and receive payments. Leading crypto exchanges such as bitcoinup.trade allow you to create a Bitcoin account for free and move funds at much lower costs than the traditional financial institutions. Most of them only charge 1% for cross-border money transfers in Bitcoin.

Bitcoin’s decentralization means it is not subject to the vast money transfer charges imposed by banks and other financial institutions. Besides, Bitcoin transactions do not involve intermediaries, further reducing the cost of moving money worldwide.
Cons of Buying a House in Bitcoin

Opportunity Cost
Cryptocurrencies are highly volatile, with constantly shifting prices that might scare some people from using them to invest in real estate. Bitcoin has grown by over 860% in the past year, with prospects of increased value in the future. As such, exchanging your Bitcoin tokens for a house now could impact a considerable opportunity cost from its future appreciation. It means you would not be able to profit from the future growth of Bitcoin’s price and value.

Limited Availability
Bitcoin adoption in the real estate industry is ongoing but some vendors, including realtors and agents, are still reluctant to accept it as a means of payment. In markets like China, where the government is fiercely cracking down on crypto service providers, it would not be easy to acquire property in Bitcoin.

Cryptocurrencies will undoubtedly cause significant disruptions in the commercial real estate sector. Crypto is still in the early adoption stages, but its influence on the way people purchase and sell property around the globe is already evident. Nevertheless, the inherent security, transparency, and low-cost money transfers associated with Bitcoin and its underlying blockchain technology make it an excellent asset for real estate transactions.