Buying Real Estate with Cryptocurrencies in Georgia (country) is possible?
Can you use cryptocurrencies to buy real estate in Georgia? Until recently, the possibilities were extremely limited. Most developers didn't want to deal with cryptocurrency, and finding a private seller who would accept cryptocurrency was like looking for a needle in a haystack.
What was required was a system that would make buyers happy - where they could transfer crypto without first having to convert it to fiat money - and sellers happy - where they could get fiat currency without ever having to accept crypto.
This is a challenge for which Habit real estate team has devised a solution. So, if you want to get your money out of crypto and into something more reliable, like bricks and mortar, Georgia is the place to be right now. Contact us to begin the process, or read on for more information.
Considerations Regarding Crypto
There are a few things to keep in mind when using cryptocurrencies in Georgia:
There are currently no laws or regulations in Georgia governing the usage of cryptocurrencies as a mode of payment. There are no transaction taxes associated with it because it is just regarded a sort of legitimate barter exchange.
Capital gains tax on cryptocurrency is currently 0%, so if you become a tax resident of Georgia by staying here 183 days in any rolling 12-month period, or by using the High Net Worth Individual program, then - barring any other tax considerations based on any other countries where you may have tax liability - both your trading activities and cashing them out would be tax-free in most cases.
On the one hand, direct cryptocurrency payments for various services in Georgia are extremely limited, if not non-existent (subject to change as cryptocurrencies gain more popularity in Georgia). However, that problem is easily solved, as there are a few exchange businesses that specialize in crypto-to-fiat conversion, even for non-residents. These services are often used to convert your cryptocurrency into fiat currency and deposit it into your local or foreign bank account.
One option is to use the crypto ATMs scattered across Tbilisi. At the time of writing, there were 39 Crypto ATMs. However, these can only be used to trade little amounts of cryptocurrency and have extremely high costs, thus they are not recommended for large transactions.
Regulations are on their way.
Although the crypto Real Estate industry in Georgia is still in its early stages, usage is increasing among both locals and the expat population. Georgia is becoming an increasingly popular location for crypto digital nomads, demonstrating the country's desirability and stability as a crypto destination.
This is the moment to get in while the regulations are still slack, as further market regulation is likely within the next twelve months. The governor of the National Bank of Georgia claimed in an interview in April 2022 that "[we] want to regulate the crypto market in Georgia." He continued, "At this time, the draft of legislative revisions includes registration/licensing, compliance testing, and anti-money laundering control requirements for crypto market operators."
We're talking months, not years, if you want to get in before the scenario changes. As a result, it's best to get started right away.
Buying Real Estate with Bitcoin
In Georgia, buying real estate using cryptocurrency is nearly identical to buying it with fiat currency. The only additional step is to convert your cryptocurrency into fiat currency utilizing a brokerage firm as a medium of exchange.
The obvious difficulty here is that most people have been exchanging their crypto for themselves, into their own bank account, and then paying in fiat for the property from their bank account. This is the phase that many cryptocurrency traders prefer to avoid. Not only do you pay additional fees (since the transfer takes two stages instead of one), but the value of discretion that crypto affords is gone.
Developers and vendors are generally reluctant to accept payment in bitcoin, while some do exist. It is not advisable to limit your property search to only vendors who accept cryptocurrencies, as this would severely limit your options. As cryptocurrency gains popularity in the coming months/years, it is entirely possible that property developers will begin accepting direct crypto payments without the need for exchanging them through a broker, but for the time being, an alternative solution is required while the legal regulations are most favorable.
The answer consists of three parts:
Establish a relationship with a broker who can pay out the fiat directly to the developer/bank seller's account, ensuring that the fiat money never ends up in your own account. The broker must also be familiar with clearing money with the bank via any KYC process.
Develop a relationship with developers/sellers so that you can cultivate trust and ensure them that this method is completely legal (which our legal team has established) and that they have no cause to be afraid of what is merely an unusual approach.
Have legal representation to ensure that the real estate sale (transfer of title) is completed on time as your funds are released to the seller's account after any bank clearing process.
Habit has spent many months refining this procedure and cultivating the necessary relationships to assist our clients move quickly from discovering a property to closing the deal. We also have a legal team that can handle all of the necessary due diligence and other legal formalities for the transaction. This is all part of our VIP service for individuals who want to buy through our crypto real estate agency.
The best part for our customers is that all of our real estate service fees are paid by the seller and broker, so we only charge you directly if you choose to use any extended services, such as our legal (see point 3 above), buy-side, or property inspections, which are provided by our partner Checkit.ge.
To begin your real estate purchase, please fill out the form below and one of our staff members will contact you with the following steps.