UK auction house Christie’s is reportedly spinning up a new division to allow crypto to be used for real estate purchases in the firm’s latest expansion of its digital asset services.
Christie’s International Real Estate now offers a team of crypto experts, lawyers and analysts to facilitate transactions where both the property seller and buyer want to work with crypto and not involve banks, The New York Times reported on Thursday.
Christie’s International Real Estate CEO Aaron Kirman told The Times he opened the service after the business made a few large real estate sales with crypto, one notable deal being for a $65 million house in Beverly Hills, California, that was purchased using Bitcoin (BTC).
It marks Christie’s latest crypto-infused service, with the firm having long offered auctions for non-fungible tokens and launching an Ethereum-based auction platform in 2022.
Christie’s dominates the auction house market alongside Sotheby’s, which has similarly embraced NFTs and crypto. Christie’s reported making $5.7 billion in sales last year, a 6% fall compared to 2023, while Sotheby’s reportedly raked in $6 billion, down 23% on the year.
Crypto can anonymize the ultra-rich’s house buys
Kirman said that real estate purchases with crypto are rare, but it’s growing as a form of payment among the wealthy as a way to make their house purchases more anonymous.
Those with high profiles and the ultra-rich rarely buy a property in their own name and have long bought homes through companies or trusts to try to obscure the paper trail leading to them.
However, internet sleuths can easily tie a company or trust to a celebrity or other high-profile person. Kirman said buyers with Christie’s are still hiding behind companies, but they’re set up to use crypto, making tracing that trail a lot more difficult due to the anonymized nature of blockchains.
Kirman said that Christie’s has “been really successful at protecting buyer identity” with the homes he’s sold involving crypto, some of which even the seller didn’t know the buyer.
$1 billion in real estate taking crypto
Christie’s reportedly has a total of $1 billion worth of real estate on offer where the sellers will take crypto, with multimillion-dollar properties from Los Angeles to Joshua Tree.
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Chris Hanley, the owner of a Joshua Tree home he’s put up for nearly $18 million, told The Times that “accepting cryptocurrency signals an openness to innovative buyers, some of whom are crypto millionaires and billionaires looking for real-world assets to diversify.”
US to consider crypto in mortgages
Kirman said he’s also discussing with banks for them to start accepting crypto for homes that need financing, and speculated that crypto will be used for more than a third of all residential real estate deals in five years.
Last month, the Federal Housing Finance Agency ordered home mortgage purchasers Fannie Mae and Freddie Mac to consider how to count crypto as assets in their risk assessments for some home loans.
FHFA director William J. Pulte told Fannie Mae, or the Federal National Mortgage Association, and Freddie Mac — the Federal Home Loan Mortgage Corporation — to “prepare a proposal for consideration of cryptocurrency as an asset for reserves in their respective single-family mortgage loan risk assessments, without conversion of said cryptocurrency to US dollars.”
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