
The real estate market of Sweden is affected by bitcoin. The buyers are using bitcoins to buy property. The Swedish jurisdiction taxes the purchase made in bitcoins, but it’s not an obstacle for many investors to use the cryptocurrency as a payment method. Visit Pattern Trader for more info about bitcoin trading.
8 ways bitcoin affects the real estate industry of Sweden:
- Many realtors have started accepting bitcoins in their businesses. For example, the Swedish real estate company Fastighetsbyrån announced in April 2014 that it would begin receiving bitcoin payments from clients. In Stockholm, the taxes are high, and therefore this has been a quick improvement for the cryptocurrency community in Sweden’s capital city.
- Many real estate buyers are paying with bitcoin, according to the CEO of Fastighetsbyrån, Peter Atterwall.
- It seems that customers are not too concerned about the fluctuations in bitcoins value when it comes to buying properties, which is probably caused by the fact that many Swedish people are used to market volatility.
- The real estate agency Fastighetsbyrån works with Sweden’s sole bitcoin exchanger, BTCX, located in Malmö and started its commercial activity in June 2012. This helps both parties to avoid any inconveniences when it comes to exchanging electronic money and traditional cash.
- The realtor, Säkerhetsfönster, also decided to start accepting bitcoins. This is possible thanks to the cooperation with the bitcoin agency Epicenter, which provides technical solutions for companies willing to take digital currencies or use them in their business model in one way or another (e.g., selling or buying).
- Axel Prep, the CEO of Fastighetsbyrån, says that the benefits for his agency are that there is no processing fee and bitcoins payments can be made at any time, while customers used to pay only after bank transfer up to 20 days.
- Axel Priap also said that the decision to accept bitcoins was a commercial one, not a political or ideological one. However, he also added that they’re still expecting more technical challenges they will face in the future.
- Bitcoin is considered legal money in Sweden. Therefore, the transaction made with bitcoins is not taxed. This situation has happened due to the amendment of the Payment Instrument Act that came into force on 1 April 2014.
8 negative effects of bitcoin on the real estate sector of Sweden:
- The real estate companies and agencies do not accept bitcoins as a payment method directly in their business. Still, they use intermediaries, which convert traditional money into bitcoins and vice versa. This increases the commission’s fees inevitably.
- Interim intermediaries still need to sell real estate properties due to the specificity of bitcoin transactions (the fact that both parties need to complete the transaction).
- The changes are only negative because buyers and sellers do not know the dollar price on the closing date.
- The price of electronic money is influenced by different factors, including supply and demand from its users, business, or individuals that accept it as a payment method or use it to buy things and services on the Internet, governments issuing it as a form of legal tender, etc.
- The lack of control, monitoring, and security makes bitcoins a high-risk payment method for real estate transactions, especially when it involves significant money.
- The fact that only a few exchangers offer this service makes it hard to find someone who can exchange the electronic currency if one of its users decides to get rid of it.
- The fact that intermediaries take high commissions fees from real estate transactions, which the sellers often pay, decreases the amount of money they receive at the end of a transaction.
- Authorities do not regulate bitcoins transactions. This means that there is no legal safety net for those who participate in a real estate transaction using this currency as the only form of payment.
Conclusion:
The real estate sector of Sweden is currently at the beginning of becoming more open towards bitcoins and other cryptocurrencies. However, this is reflected by the fact that some real estate agencies accept them not directly in their business model but through mediators that turn traditional money into bitcoins or vice versa.