Saturday, September 11, 2021

RE or btc, that is the question

Over the last few weeks I got into discussions on real estate vs bitcoin.
I am bullish real estate. I also sold an investment property to buy bitcoin. The million sat question:

If I did NOT own a home, would I buy a home now or buy bitcoin? My answer: bitcoin. Here's why.

  1. The factors that are making real estate go up are the same factors that make bitcoin go up. Bitcoin just goes up harder and faster when these factors happen.
  2. Not being a jerk, and I think real estate goes much higher, but I have a lot more friends who have been saying real estate will crash over the last 5 years who then bought a house within the last 12 months.
  3. The only exception to this idea-of buying real estate instead of bitcoin- is luxury real estate with at least 10 to 1 but hopefully 20 to 1 leverage. This is not possible for the majority of first time buyers.
  4. Bitcoin allows an expansion of a position; Got a bonus check? into bitcoin. Yes, you could buy a reit I guess, but besides that it's hard to dca or throw extra towards real estate.
  5. Bitcoin allows mobility-for many people, I think they are wildly understating how important this will be over the next decade.
  6. As bitcoin matures and lending products get longer terms and higher ltv, the price of bitcoin might explode even higher. Real estate is tapped out in this respect.
  7. A life changing event happens-you get sick, divorced, married, want to take time off, whatever-it's hard to do this as a landlord. Believe me. My tenants (and they aren't bad) need attention. Literally have a hard time fixing the most basic things. Don't think property management companies are turn-key.
  8. Go back to #2. Add that most people own one home. People who come into bitcoin accumulate hard. The supply getting sucked up relative to real estate is on another level.
  9. I know multiple people who consider themselves conservative who have 90% of their wealth in real estate. I know no one who is worth more than $500k who has more than 10% of their net worth in btc.
  10. In 4-5 years I believe the majority of phones will come with digital wallets. I don't see this happening for real estate.

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