Turtlesallthewaydown⚡️ on Nostr: I’ve been pondering this a lot lately. So the pro’s of realestate in Aust is 1. ...
I’ve been pondering this a lot lately.
So the pro’s of realestate in Aust is
1. it’s pretty stable, value wise, and generally trends up or sideways and when it trends down, as long as you keep paying your mortgage, there is no margin call.
2. That makes well chosen realestate a pretty good leverage play
3. Capital gains plus income
4. Ability to add value and thus increase both capital gains and income.
There are too many cons to list.
I have wondered if, as Bitcoin becomes more monetised and thus stabilises aka is less volatile to the upside and downside, there might be a place for realestate as an investment vehicle purely for the relatively ‘safe’ and high leverage play it allows for. However, this thesis does not take into account the de-monetisation of realestate as an asset class back to utility value.
So I suspect, in the short to medium term, Bitcoin trumps real estate in every way imaginable, except for it being income producing. However, in the long term when Bitcoin is global money and has consumed all value excluding incremental annual GDP growth and realestate has reduced to utility/scarce land value. A home with ocean views is always going to trump the same home without views. Maybe then there is value in the ‘safe’ leverage play available for realestate? However, in a fully bitcoinised world it would not be a good idea to take a Bitcoin loan to buy realestate as you’d be forever trying to payback something of greater value with an income that was reducing… I think that is how deflation on a Bitcoin standard would work. So in that world you’d work hard, save your Bitcoin and once you’d saved enough, buy your house outright? As you save your savings would go up and the cost of your house (the cost of everything deflates over time in Bitcoin terms) would come down and eventually you’d meet in the middle.
Such a paradigm shift from what we know now, it’s challenging to think through.
So the pro’s of realestate in Aust is
1. it’s pretty stable, value wise, and generally trends up or sideways and when it trends down, as long as you keep paying your mortgage, there is no margin call.
2. That makes well chosen realestate a pretty good leverage play
3. Capital gains plus income
4. Ability to add value and thus increase both capital gains and income.
There are too many cons to list.
I have wondered if, as Bitcoin becomes more monetised and thus stabilises aka is less volatile to the upside and downside, there might be a place for realestate as an investment vehicle purely for the relatively ‘safe’ and high leverage play it allows for. However, this thesis does not take into account the de-monetisation of realestate as an asset class back to utility value.
So I suspect, in the short to medium term, Bitcoin trumps real estate in every way imaginable, except for it being income producing. However, in the long term when Bitcoin is global money and has consumed all value excluding incremental annual GDP growth and realestate has reduced to utility/scarce land value. A home with ocean views is always going to trump the same home without views. Maybe then there is value in the ‘safe’ leverage play available for realestate? However, in a fully bitcoinised world it would not be a good idea to take a Bitcoin loan to buy realestate as you’d be forever trying to payback something of greater value with an income that was reducing… I think that is how deflation on a Bitcoin standard would work. So in that world you’d work hard, save your Bitcoin and once you’d saved enough, buy your house outright? As you save your savings would go up and the cost of your house (the cost of everything deflates over time in Bitcoin terms) would come down and eventually you’d meet in the middle.
Such a paradigm shift from what we know now, it’s challenging to think through.