A Guide To Using Bitcoin To Purchase A Home

A Guide To Using Bitcoin To Purchase A Home

If you have not been hiding underneath a rock for the past couple of years, you have likely heard of Bitcoin. This is a cryptocurrency that has quickly become one of the trendiest ways to pay for anything you want, even homes. Before you consider moving forward with this kind of real estate deal, here is everything that you need to know.

Everyone Is Not On Board With This

Unfortunately, using Bitcoin to buy a home has it’s disadvantages. One of the main ones is the fact that everyone out there will not be ready to accept cryptocurrency with open arms. Sometimes this method of payment is volatile and they may be worried about losing money on the deal. This means that the number of properties that will be available to you will be far less than it would be for someone who is looking to pay with traditional dollars.

In addition to worrying about the seller, you will also have to find escrow and title companies that are willing to do business with you. This is far easier said than done, especially since this is a fairly new currency that many are not familiar with. The ones who agree to help may require you to cash out your funds before completing the transaction.

Bitcoin And Taxes

Another thing that you will need to worry about is the way that taxes are calculated. If you are not familiar with Bitcoin, this can be a very confusing territory. The way that the tax is calculated largely depends on the country where the purchase takes place. If you are in the United States, it is considered property, which means that you will have to worry about calculating capital gains tax.

There are tutorials available out there to help you gain a better understanding of how this works. If you are still not able to grasp it thoroughly after reviewing one or more of these, it may be necessary for you to reach out to an accountant or other certified tax professional.

Sellers May Seriously Profit

One thing you should be aware of is the fact that the Bitcoin to USD exchange rate changes all of the time. This means that you may believe you are buying a home for a specific amount of money, yet when the deal goes through the seller ends up with much more. If your goal is to buy property and you are not really concerned with that side of things, you are problem not concerned with this. On the flip side, if you are someone who is really concerned about possibly buying a home from someone and boosting their profit tenfold, a Bitcoin purchase may not be the best idea.

In a world where technology seems to be taking over and nearly everything can be done digitally it should be no surprise that buying a home can be done with the click of a mouse. If you have been dabbling with Bitcoin or you are a seasoned investor, you should have more than enough information to decide if a cryptocurrency home purchase is in your future.

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