As Bitcoin becomes more widespread, doors begin to open to use it for more conventional means of purchasing big-ticket items, such as property.

Jenna Hall is a content marketing coordinator at Redfin. Redfin does not provide legal, tax, or financial advice. This article is for informational purposes only and is not a substitute for professional advice from a licensed attorney, tax professional or financial advisor.

From increased competition to low mortgage rates, the real estate market has undergone substantial changes in the past decade. One of the most significant changes is the payment method homeowners are using to purchase new homes. A recent Redfin report found that one in nine first-time homebuyers saved for their down payment by selling cryptocurrency like bitcoin.

A few years ago, saving for a down payment or buying a home with bitcoin would have been unthinkable, but today it’s possible. A growing number of private home sellers, real estate agents and mortgage companies are accepting bitcoin as an alternative form of payment. So how can you buy a house with bitcoin, and how can you determine if utilizing your holdings to purchase your dream home is a good option for you? Here are some things to consider.

Can You Buy A House With Bitcoin?

Yes, you can buy a house with bitcoin and other digital assets. You can leverage these assets in many ways, like transacting bitcoin directly with a seller, qualifying for a mortgage or converting your holdings into cash.

Transfer Bitcoin With A Private Seller

If you want to buy a home by simply transferring bitcoin, you first need to find a seller who’s willing to accept bitcoin as payment.

Have a conversation with the seller about the terms of exchange so that problems don’t arise in the future. Since transferring bitcoin has no paper trail, it’s crucial that you contact a legal professional to ensure proper paperwork and documentation about the purchase is created.

Use Bitcoin Holdings To Qualify For A Mortgage

The real estate market can be a complicated place and the process of qualifying for a mortgage can be confusing at times. For any significant change to occur, the buy-in of major mortgage loan companies like Freddie Mac is required.

The good news for bitcoin holders is that Freddie Mac has clarified its position on the use of bitcoin in the mortgage qualification process. They have indicated that you can use bitcoin to secure a mortgage loan under certain circumstances. Since using cryptocurrency in the real estate market is relatively new, Freddie Mac regularly updates their guidelines. Be sure to look at their latest bulletin for the most up-to-date information about using bitcoin to qualify for a mortgage.

Other mortgage lenders allow people to use their bitcoin holdings as collateral for their loans. If you plan to use bitcoin to secure a mortgage, you should first ensure you have all the paperwork to back up your claims and investments. To qualify for a bitcoin-backed mortgage, you’ll need documentation showing the original purchase, as well as documented proof-of-sale.

Convert To Cash

If you can’t find a seller who will accept bitcoin and you don’t want to use your holdings for a mortgage, you can still use bitcoin to buy a home by selling your holdings and converting it into cash.

Before you sell, you’ll need to thoroughly document every part of the process, from the original purchase to the eventual sale. If you fail to keep a valid paper trail, the bank or broker could refuse your mortgage application or flag the sale.

You’ll also need to make sure your transaction is conducted in U.S. dollars and report any profits to the IRS. In the United States, bitcoin holdings are an asset similar to property, making them subject to the capital gains tax much like equity holdings.

If you plan to make any large transactions including selling bitcoin to buy a home, finance your down payment or qualify for a mortgage, consult both legal and tax professionals to ensure the purchase has proper documentation, all rules and regulations are followed and all taxes are paid and filed properly.

Advantages And Disadvantages Of Buying A House With Bitcoin

While buying a house with bitcoin is possible, there are many considerations to weigh when contemplating using your holdings to pay for the home of your dreams.


Potential Savings

A home seller could potentially see more value in bitcoin than in cash. If this is the case, you could get a better price on a home if you’re paying in bitcoin. Using bitcoin to pay for a home may also make your offer stand out and give you a better chance of getting a home compared to other cash offers.

Fast Payments

Similar to using cash, buying a home upfront with bitcoin can accelerate real estate transactions by eliminating the traditional mortgage process. This means that people utilizing bitcoin can purchase their homes in a matter of minutes.


One of the most significant advantages is diversification. Using Bitcoin to purchase a home allows you to branch out into the real estate market and diversify your portfolio.



The volatility of bitcoin may cause hesitation, even if you currently have the funds to make the transaction happen. The price of bitcoin can vary widely from day to day, making it hard to determine the value of a home in bitcoin terms.


As mentioned earlier, when you sell bitcoin, it’s subject to taxes and it’s easy to make a mistake when reporting profits and losses. If you make a mistake when reporting your transactions to the IRS and you’re suddenly using bitcoin funds to buy a home or make a down payment, the IRS or a tax agency may flag it.

Some Companies May Not Work With Bitcoin

Since Bitcoin is still relatively new, highly volatile and difficult to connect to certain identities, many companies don’t conduct transactions with bitcoin. It may be challenging to find a seller, mortgage lender, real estate agent or bank that will work with or accept bitcoin as a form of payment.

Potential Legal Issues

Bitcoin prides itself on its security and ability to keep transactions anonymous. This may be useful on the blockchain, but when buying a home, anonymous transactions could lead to potential legal problems. Also, since Bitcoin transactions aren’t reversible, getting your money back during any litigation disputes can be difficult or even near impossible.

Special Cases

Buying a home with bitcoin can be difficult if your real estate deal has special conditions, such as lengthy inspections or unique seller/buyer contingencies. 

Can You Buy A House With Bitcoin? Final Things To Keep In Mind

If you plan on using bitcoin in any capacity to help you buy a home, here are some final things to keep in mind:

  • Paperwork, paperwork and more paperwork – Make sure to have reliable documentation during every step of the transaction process to protect yourself and the seller.
  • Taxes – Along with the capital gains tax, there are many taxes and fees you’ll have to pay when buying a house with bitcoin. Make sure to account for real estate commissions, county taxes, recording fees, etc.
  • Digital wallet – Some banks and credit card companies have banned the use of transactions involving bitcoin. If this is the case and you are transacting in bitcoin directly with the seller, you may only be able to initiate a transaction via your digital wallet. Check with your financial institution or advisor for their specific guidelines and policies regarding digital wallet transactions.

This is a guest post by Jenna Hall. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.


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