How To Buy A House With Bitcoin
Bitcoin's growing acceptance and rising value have given individuals worldwide the unique opportunity to use their coins to purchase property, especially for those who took the chance when its value was at its lowest.
Over the past 14 years, Bitcoin’s value has fluctuated dramatically, with significant drops and surges happening within minutes. This volatility has made many who doubted its legitimacy regret not investing back in 2009.
In December 2017, a house in Essex made history as the first-ever property to be purchased using cryptocurrency in the UK. The transaction cost the buyer just 63 Bitcoin, which at the time was equivalent to £350,000.
Property experts at Omni Removals will explore Bitcoin’s role in the property industry, including which estate agents are now accepting Bitcoin, the advantages and disadvantages of using cryptocurrency to buy property, and the future of purchasing homes with Bitcoin in the UK.
What is Bitcoin?
Bitcoin is a decentralized form of cryptocurrency, meaning it is not controlled by any government or bank. Its rising popularity can be attributed to its high value and the ability to send money quickly, anonymously, and often without any transaction fees.
Despite Bitcoin's high volatility—its value was £2,727 in September 2017, skyrocketed to £14,380 by December, and then dropped to £7,836 a month later in January—the risk has proven profitable for some. For example, a £30 investment in Bitcoin back in 2010 would make you a millionaire today. As of January 2024, Bitcoin’s price is over £35,000.
If you're not very familiar with Bitcoin, we've highlighted some facts you should know about the cryptocurrency.
Bitcoin was founded in 2009 by “Satoshi Nakamoto”, whose identity is still unknown.
There are and only ever will be 21 million Bitcoins created.
The value was practically nothing in 2009.
The first Bitcoin transaction was used to buy 2 pizzas in 2010.
Bitcoin’s highest value was £14,759 in 2017.
Bitcoin lost more than 50% of its value within 2 months from December 2017 to February 2018.
There are 169 Bitcoin ATMs in the UK with 110 of them being in London.
To buy an average-priced house in the UK, it would cost you a little over 6 Bitcoins, the equivalent of around £220,000.
Buying a House with Bitcoin Timeline
Buying a house with Bitcoin in the UK has been done before, and the demand from young buyers for sellers to accept cryptocurrency as payment is rapidly increasing. We’ve put together a timeline to show the increasing popularity and the “firsts” of using cryptocurrency in the property-buying industry.
JAN 2009
Bitcoin was founded in 2009 by “Satoshi Nakamoto”, whose identity remains anonymous. Bitcoin was worth practically nothing up until March 2010, when it had a value of £0.002/$0.003.
2012
BTCJam was created to loan people Bitcoin as a way to improve their credit score, essentially helping people have a better chance of getting a loan, deposit and buying a house.
2013
International Blockchain Real Estate Association (IBREA) was set up to encourage people to pay via blockchain in the property industry.
In 2013, Bitcoin Real Estate was founded. A Canadian website specialising in buying and selling property worldwide using cryptocurrency, with the main forms being Bitcoin, Ethereum and Litecoin.
NOV 2013
The value of Bitcoin reached a high of £952/$1,242.
AUG 2017
Agape Properties become the first UK letting agents to accept Bitcoin as a payment on property and even for rent. The company is based in Croydon, London.
SEPT 2017
The first ever house was bought with Ethereum in Kyiv, Ukraine for the equivalent of £46,000/$60,000.
OCT 2017
A mansion in Notting Hill, London, was up for sale for £17 million only accepting the cryptocurrencies Bitcoin and Ethereum. The house is still on the market.
DEC 2017
The first ever house was sold in the UK where the buyers paid entirely with Bitcoin. Property Developer Go Homes sold two houses worth £350,000 and £595,000. This was the first time the Land Registry had permitted to record a Bitcoin sale.
FEB 2018
Michael Komaransky makes history by selling his house for the highest ever Bitcoin to Bitcoin transaction at 455 coins.
Do Estate Agents Accept Bitcoin?
Many estate agents and sellers are extremely wary of accepting any form of cryptocurrency due to its unpredictability and lack of protection. However, the number of UK and US estate agents willing to take Bitcoin as payment is slowly on the rise.
After the first successful sale of a UK property using only Bitcoin, Go Homes announced it’ll accept the digital currency to buy any of their other 250 homes available. The Land Registry also made history by agreeing to record the sale of the property in Bitcoin value for the first time.
We’ve put together a list of the more popular estate agents and websites that accept Bitcoin or have certain listings that will accept Bitcoin.
UK & Northern Ireland:
The Collective
Go Homes
Rightmove
Agape Properties
Hagan Homes
Munday’s Estate Agents
US & Canada:
Magnum Real Estate Group
Sand Key Realty
Kuper Sotheby's International Realty
Open Listings
Redfin
Bitcoin Real Estate
How to Buy a House with Bitcoin
There are two main ways to buy a property with Bitcoin. First, if the seller is not willing to accept cryptocurrency as payment, you can exchange or sell your Bitcoins for cash through a third-party website. The second option is if the seller agrees to accept Bitcoin entirely; in this case, you would just need to settle on the final price and address any associated fees, particularly with companies that don't accept digital currencies.
AGAPE Properties, a property developer, became the first to accept Bitcoin for house payments in 2017. However, they told Omni Removals that they’ve yet to complete any Bitcoin transactions, mainly because Bitcoin mortgages are not currently available. As a result, you would need to pay the full asking price upfront, either in Bitcoin or cash.
Many banks have made it clear that they will not accept money originating from Bitcoin or other cryptocurrencies due to their unregulated nature. Bitcoin transactions are often untraceable, and because they are sometimes linked to money laundering, securing a mortgage is not possible.
Some institutions, however, are more open to accepting Bitcoin earnings as deposits. Coventry Building Society, Skipton, and Yorkshire Building Society have confirmed they accept deposits from Bitcoin earnings, while banks like Santander, Nationwide, and Aldermore have explicitly stated that they will not accept such deposits.
Advantages of Buying a House with Bitcoin
If you have the opportunity to buy a house with Bitcoin but are unsure whether to go ahead with it, then you'll want to find out the benefits. Buying a house using Bitcoin comes with many advantages and we've listed the main points below.
Buying a house with Bitcoin cuts out the middleman, which speeds up the process of buying a house for both the buyer and seller.
Bitcoin doesn’t belong to a bank or any other institution, therefore people can remain anonymous when purchasing property, which has proved to be popular amongst Bitcoin buyers.
The fees you’d typically pay with a credit or debit card will be lower when buying a house with Bitcoin or in some cases won’t be relevant at all.
The majority of sellers accepting Bitcoin will offer a good discount for those who will pay in the cryptocurrency.
You will have more of a chance of securing the property as some sellers will only accept cryptocurrency as payment.
Disadvantages of Buying a House with Bitcoin
There's an obvious risk when buying a house with Bitcoin due to its ever-changing value. We've compiled some disadvantages to make you aware of the risks.
The volatility of Bitcoin’s value means it's highly unpredictable. Its value is known to increase or decrease significantly within seconds, making it harder to agree on a sale price.
The people who can afford to buy houses via Bitcoin are mainly “Bitcoin miners”, who invested before its popularity rose, so only a select few would be able to have enough to buy a house.
It’s hard to sort out insurance, estate agent fees and stamp duty with Bitcoin, making the process of buying a house more difficult.
Bitcoin isn’t protected by a UK regulatory protection scheme, meaning you’ll have no backup if you get hacked or the value goes to pot.
Due to Bitcoin’s anonymity, it’s commonly used to carry out drug deals and money laundering, which puts many estate agents and sellers off the idea of accepting Bitcoin as they don’t trust that it’s legitimate money.
The Future of Bitcoin in the Property Market
Bitcoin’s growing presence in the property market continues to gain momentum, with an increasing number of estate agents worldwide accepting it as a form of payment for both property purchases and rentals. While cryptocurrencies, including Bitcoin, still have their fair share of sceptics, many believe this is just the beginning of their journey in real estate transactions.
The primary interest in buying property with Bitcoin has been seen among a young, predominantly Asian demographic who have profited significantly from Bitcoin investments, according to one London property seller. As Bitcoin's value and popularity soar, many early adopters who invested in the digital currency when it first emerged now find themselves with the opportunity to purchase property using Bitcoin.
Looking ahead, Go Homes director Ed Casson suggests that although Bitcoin transactions have been integrated into the traditional property buying process, blockchain technology may completely reshape the system. He explains, “We are pioneering blockchain technology to speed up home purchases, bringing ‘click-to-purchase’ capabilities that replace the outdated methods currently used to buy and sell property.”
Casson believes that blockchain will make property transactions more liquid in the future and enable fractional ownership through smart contracts.
Despite these advancements, the future of Bitcoin investment remains uncertain. For Bitcoin to become a widely accepted currency for everyday use, it would require a stable and consistent value, as without this, setting prices for everyday items would be unfeasible.
