In a first for the Seattle-area, a local man recently purchased a home (in Tukwila) with cryptocurrency. The Seattle Times reported that, "...the buyer used a combination of bitcoin cash (a new type of Bitcoin) and several other cryptocurrencies for the 10 percent down payment and to help secure a conventional mortgage for the remaining cost of the house." Though, before closing, the funds were converted into regular US currency to facilitate the sale. This is the first sale recorded in the Puget Sound region that was purchased with cryptocurrency; though not the first in the nation. In September 2017 a man in Texas purchased a home with Kuper Sotheby's International Realty using Bitcoin to cover the entire sale price.
Though many people have probably heard of Bitcoin by now, there are now several types of cryptocurrency. New types you may start hearing more about include: bitcoin cash, ZCash, Monero, Ripple, and Ethereum. Another recent Seattle Times article breaks these down to describe how they're similar and how they're used. They essentially all function the same way, however; and act as digital funds that are produced in limited quantities and without involvement of a bank or governmental regulations. They also fluctuate in value daily. With the value currently skyrocketing many early adopters are cashing out, like stock, to convert into regular money. They can, however, also be used electronically to buy things, when the seller is willing to accept them as payment.
While cryptocurrency is gaining popularity, only time will tell if it will play a large role in future real estate transactions. Many financial experts are wary of the value’s ability to continually rise with no control. There are some that are comparing this new popularity and success with the 2008 housing crash. The agents and mortgage broker involved in the transaction were all worried, initially, though in the end realized, "It was just like any typical transaction -- people cash in their 401(k)s, or stocks or other investments... it makes sense, as long as you can document the purchase of it." The same mortgage broker, Oleg Tkach, also stated, "Unless something changes with cryptocurrency I believe it's going to become more common."
Most recent bitcoin real estate purchases have been for the full price of the home; and many people have started marketing properties as "bitcoin friendly" or only available for purchase with bitcoin. However, for now, Washington based purchases cannot solely be purchased with bitcoin as there are government agencies that get taxes on home sales and still need traditional cash currency. Keep your eyes peeled for more cryptocurrency news in the coming months. We’re sure to continue seeing how it will play a role in real estate.