A property owner in Melbourne's outer-east is accepting Bitcoin as payment for the house he is selling, in what could be Australia's first cryptocurrency property transaction.
Located in The Basin, 1411 Mountain Highway is up for sale with its listing stating the “owner is agreeable to accept part payment in Bitcoin”.
The news comes as the cryptocurrency surged past $US9,000 on Monday, less than a week after passing the $US8,000 mark -- marking an 850 per cent rise over the past year.
It's not the first time the cryptocurrency has been accepted as payment for property, last month British wealth management firm London Wall specified they would favour offers of Bitcoin when they listed a multi-million pound six-storey London mansion.
Blockchain, the technology behind cryptocurrency is an anonymous, secure database that records digital transactions and according to experts, it could change the property industry.
Related Reading: [Can Bitcoin Revolutionise The Future Of Real Estate?]
1411 Mountain Highway, The Basin. Photo: Harcourts Boronia
Robert Gadd is the vendor of 1411 Mountain Highway. Gadd is an experienced builder who buys, renovates and flips houses. He purchased his first Bitcoin earlier this year after observing the cryptocurrency market evolve over the past decade.
“I see cryptocurrency at the moment as like the early days of the Internet dot com era,” Gadd told Domain.
He believes announcing the property Bitcoin-friendly could be the deciding factor in someone’s ability to purchase the house.
If it came down to two or three people, and both had their maximum borrowing capacity at a certain amount, and one has bitcoin — because the banks don’t look at Bitcoin as an asset — that could be something that could get them across the line.”
Harcourts listing agent John Garnett said the sale would be the first time he had handled cryptocurrency in real estate.
“There’s a few logistics we still have to iron out," Garnett said.
“We’ve got to be careful because the state revenue office will want the stamp duty to be paid on market revenue.”
Due to the dramatic fluctuations that Bitcoin is prone to, the day of the transaction could become difficult for buyers and sellers.
“The way it would be is if someone was going to offer $10,000 in Bitcoin, then that would be $10,000 in Bitcoin whenever they pay that,” Gadd said.
“So if the market goes up or down or drops, that’s it.”
Consumer Affairs Victoria said it was legal for the deposit or settlement amount to be paid in any asset or security agreed between the buyer and seller, including Bitcoin.
[Related reading: WTF Blockchain! Who Are You and What do You Mean for Property?]
As cryptocurrency becomes more commonplace, the property market is expected to see an increase in the number of transactions using digital currency, while government regulators around the globe rush to set out clear guidelines for Blockchain transactions.