Key Points
- Vendors in Ballarat sold their 582m² land block exclusively for Bitcoin, highlighting a shift towards crypto in real estate.
- Blockchain technology is increasingly impacting the real estate sector by reducing intermediary costs and easing cross-border transactions.
Bitcoin-Only Real Estate Sale in Ballarat
Two pairs of vendors in Ballarat put their 582m² land block up for sale, only accepting Bitcoin as payment.
The land, located at 7 Magpie Street, was purchased by Melissa Bower and Trudy Purcell in 2021 with plans to transform the old miners’ cottage into a remarkable property. However, the renovation proved to be more challenging than anticipated.
Bower, Purcell, along with Sasha Semjonov and Tessa Dunstan, secured a permit to build two townhouses on the vacant land. However, due to economic factors such as inflation and high interest rates, they decided to sell the block instead.
Why Bitcoin?
The decision to accept only Bitcoin for the land sale was primarily to eliminate middleman costs. Bower and Purcell desired a quick and secure transaction without the need for estate agents or bank operations. The sale was completed within an hour, without any inspection or staging.
Crypto in Real Estate
The Ballarat land sale is not an isolated incident. More people globally are using crypto to pay for real estate, despite Bitcoin only being legal tender in El Salvador. A notable example is a $22 million penthouse in Miami sold for cryptocurrency in 2021.
Cryptocurrency payments for property can bypass intermediary costs and remove barriers associated with cross-border transactions. Moreover, many people accumulate the necessary funds for real estate purchases through investment in crypto. For instance, in the last quarter of 2021, nearly 12% of all first-time homebuyers used money from selling their crypto holdings.
Interestingly, real estate is becoming increasingly affordable when evaluated in Bitcoin rather than fiat money, as the BTC price has been growing faster than real estate prices in USD.
Blockchain and Real Estate
Blockchain has the potential to revolutionize the real estate sector, one of the world’s largest markets. It can eliminate intermediary fees and reduce bureaucracy. Blockchain can facilitate the trade of property through smart contracts, which automatically execute the transaction once the conditions are met, without any agent fees.
Blockchain also removes time-consuming paperwork and allows for quick property trading. It provides verified ownership and gives buyers access to all necessary legal information about the property they intend to buy. Moreover, through tokenization, owners can sell fractions of their property as digital tokens.
Applications are also being developed to facilitate rent collection and other matters via crypto payments. Despite concerns about crypto price volatility, many are optimistic about the potential increase in value of the crypto they receive in exchange for property.