Real Estate has been treated like an investment asset and a Store of Value for centuries.
With exponential increase in Real Estate prices, the youth is already priced out.
Youth are turning to Bitcoin - the Digital Real Estate play.
Compare the properties of both below:
This is interesting, but there are somethings missing.
What about the cash flow in real estate?
What about the depreciation?
What about maintenance being passed through the tenant aka NNN properties?
Ownership can be divided.
The average home in the US cost 400 BTC 5yrs ago. Today that home costs 4BTC. Looking at the math, it would still make sense to hold BTC and cash out for expenses when required.
BTC is will appreciate multifold over time considering the inbuilt scarcity.
General Real Estate practice around maintenance sits with the landlord particularly for services like HVAC, and other large expenses. To stay competitive you are limited on what you can pass on.
Generally that is true for residential real estate. Commercial real estate offers the triple net lease where taxes, insurance and common area maintenance are pass thru expenses.
I do believe bitcoin will outperform real estate in terms of appreciation..
A better approach would be to borrow against your BTC and never sell. Avg. yearly returns sit at 55% and are projected to drop over time but remain at around 30% for the next 30yrs. Interest on borrowing against your BTC is about 12% p.a. and will go down over time as adoption increases.
I've analyzed combining real estate with Bitcoin and do believe BTC can enhance real estate, but I think this comparison is focused on the appreciation and not the cash flow analysis.
2 additional models are being adopted by landlords:
1. Monthly cash flows from rent payments are being pushed into BTC.
2. Real Estate is being used as collateral to buy more BTC.
In both scenarios, BTC appreciation will push the business case even higher and depending on the amount being dollar cost averaged into BTC, the returns from BTC will eventually surpass the rental income.
We are looking at distributing dividends on Lightning. There is so much Bitcoin can do for real estate.
