Despite bitcoin's wild ride the past few months, how big of an effect can this really have on buying and selling a home?
It turns out people have been pocketing large amounts of money from bitcoin and spending their extra cash on luxury items, even homes. Thirty-seven of these cryptocurrency homes for sale were found to accept bitcoin as a form of payment. Many are starting to wonder if the use of digital currencies, such as bitcoin, will become the new norm when buying and selling a home.
Bitcoin's currency rose 1,838% last year on January 1st, before dramatically falling. The fluctuations can be too drastic to ignore, causing future home sellers and buyers to stay away from digital currencies. Since bitcoin is only worth as much as people are really wiling to continue buying it for, those who are more of risk takers will continue to take there chance, while others will continue to stay safe with there physical money.
Millennials are predicted to be the deciding factor on whether digital currency will continue in our society or not. Many bitcoin tech savvy users who are between the ages of 20 to their early 40s, buying properties between $2 million to $3.5 million. This form of digital currency is also popular with Asia, Europe and other foreign buyers when buying out of the country.
This currency is gradually becoming a more popular form of payment. Some online merchants currently excepting this form of payment are overstock.com, expedia.com, as well as some car dealerships. Other stores such as Sephora, Amazon and Best Buy allow these virtual coins to be converted into a gift card.
The idea of using bitcoin's currency for home sellers is a large gamble, where they could have a lot to loose. Real Estate transactions are more reluctant to take bitcoin transactions as it is difficult to prove having enough coins to purchase a property. This would also raise issues with financing, and getting a mortgage from a lender.
The risks of cryptocurrency consist of the fluctuation, some high transaction cost, lack of oversight, etc. make it difficult to see whether digital currency would be good for future transactions.