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Thank you 🙏🏻 Very valuable thoughts. I will have to double check if your calculations apply to EU/Germany, but I generally agree.

I need those numbers for Germany too, my wife thinks we should get a house.

You can buy a house, then take a loan against it and buy BTC with that money. Then you still have the BTC whatever happens with the house, the bank, and the country 😁

Sounds tempting 😉 Unfortunately this won’t work (at least in the EU). The bank will only give you a loan when it sees the signed contract for the house purchase and all necessary insurances. It’s part of the loan deal.

If I could buy a house first, without the bank, why would I bother at all? Also in that case, I would just go all-in for bitcoins and buy a house after the nearest halving.

Maybe his wife doesn't want to wait for a halving? 😁

The halving is a holy event. Not waiting for it is blasphemy.

Forgive her she knows not what she is doing

I thought about that but it isn’t as simple as it sounds. A lot of banks hold custody of the bitcoin. If something happens to the bank, country, or house they can sell your bitcoin because you don’t hold the keys when you take out the loan. Also, the interest rate is over 16% on the websites I’ve looked at so you are paying about the same as capital gains tax. And you have to post a significant amount as collateral. If the bitcoin price tanks, then you have to post more collateral or get liquidated.

I proposed to take a loan against the house, not against the bitcoin. So in worst case you lose the house, not bitcoin.

My bad brain fart lol yeah that may work but I haven’t run the numbers. Most my age are still trying to buy a home so this isn’t an option for everyone.

Plus new homeowners won’t have much equity to take a loan out against anyway and the interest rate is going to be pretty high on that as well. Fiat games are annoying.

But if you morgage the house and use that money to buy bitcoin and hold in own custody that sounds possile, or are there more hidden tricks they play?

One should check in individual case, what is better. I guess, that because the mortgage is available for both someone who already has enough money to buy and the one who doesn't, it is in general less efficient for the first group of people. Banks have to exploit the second group of people somehow, so conditions should be worse in general. But everyone should check themselves, because it may vary from country to country and from person to person :)

The landlord might surprise us and tell us to move out in which case we will have to find a new place but all the rental prices have gone up. Buying a smals house just might make sense. But it feels more tempting to get bitcoin before the halvening.

You can also wait for halving in a cheap country, e.g. in Thailand.

Definitely let me know what you find. My guess is that it’s probably worse in Europe.

Yes, it’s also my feeling. Despite the 2022 price fall, it would be nearly impossible to get a loan with suitable conditions (banks adapt and react faster than people). The inflation comes on top of that. In addition, Germany‘s economy is doing well rn, the recession is gaining momentum (2nd year quarter without a plus in a row). Taxes have not been raised, but it’s a matter of time given our leftist government.

Stay humble and stack sats 🫡

💜🫂

₿logging₿itcoin 2y ago

This doesn't include maintanance. Most "real estate investors" pretend those costs do not exist.

Yes that’s right. They say that you can depreicate those expenses but there is a limit on how much you can depreciate. Once you reach that limit you have to do a 1031 exchange for a different property and then you can depreciate more. But these are all fiat games that eat up a lot of your time. Just holding bitcoin is so much easier.

₿logging₿itcoin 2y ago

That is still an opportunity cost and you would be better off buying a whole bitcoin instead of renovating your kitchen.

I agree. Let the landlord pay for that 😂

*handle that I should say

Time is the scarcest resource so anything that saves you time is more valuable.

Anchorite 2y ago

30% for 30 years though? It's conservative for now, but perhaps optimistic for 10y from now.

You have to assume that at some point Bitcoin levels out. It's going up forever, but not 30% annual forever.

This is a fair point but even if you cut the returns in half, you are still much better off. Plus bitcoin adoption is still incredibly low and the currency is deflationary which we’ve never seen before. My estimates might not be bullish enough but no one knows the future I could be wrong.

niltempus 2y ago

owing a home isn't solely about the numbers.

Can you expand on that?

Hitem20 2y ago

As an owner of multiple properties that were paid for thought lease/rentals and continue to to provide monthly passive income that allows us to purchase more BTC, I highly suggest doing research and finding a great deal on as many properties as you can

Faroaldo 2y ago

Agree. We don’t know what future brings. Maybe we should redo calculations with different BTC price growth rate.

What growth rate do you want to try?

Faroaldo 2y ago

I’m cautious… Try 0-10-20%

I’m not doing 0 lol

20% will be $6,137,470 which is about 3x what real estate might get you.

10% would be a loss of $644,302.

Consciousness Incarnate 1y ago

Great thread, I came to similar conclusions when making a decision last year to sell my rental real estate holding for btc. Never looking back

nostr:npub1jvp6kfs2d3m98lyw5wcyr4fnctr83s0rc3mj5p0f75ach6vcd8rst6wqnu

Let me know if I missed anything

VelvetBlue_art 1y ago

You didn't. I'm talking about buying outright and living there myself. I won't need to worry about 30 years or empty rentals that way.

If we get enough we may buy 2 and rent one to a friend that needs relief, who would be a good tenant long term.

There isn't just one way to look at it or run the numbers, however yours is a great deep dive analysis.

I don’t think there’s anything wrong with what you want to do. It just depends on the individual. I was just illustrating the potential opportunity cost. The money you put down for that house has an opportunity cost. I personally would rather rent and get the bigger return I expect from bitcoin and not have to worry about things like maintenance where I live. I also want to travel around but owning a home ties you down to one location.

VelvetBlue_art 1y ago

That's what we want. 🤗

Good luck you got this 🫡

Noshole 1y ago

I think that the amount of “shitcoinyness” in real estate highly depends on the interest rate and what type of mortgage (e.g., 30-year fixed)

Like if you got in around 2020 for example with like a 2.5% fixed, I don’t see that as a shitcoin. If you’re messing around trying to buy today, you’re gonna be fucked with rates unless you have the cash.

🐢 1y ago

It’s more dependent on if you need a home over anything.

:P 1y ago

I mean why rent when you can climb a mountain pitch a tent and fall asleep for 20 years like Rip Van Winkle

Real Estate may not outperform bitcoin but it gives you tangible enjoyment and freedoms you can’t obtain while renting.

Additionally you get depreciation, price appreciation and can do cash out refinancing tax free which you can dca into bitcoin with.