Would You Trade Your Bitcoin For A House?

9 months ago

This is an interesting conundrum. Especially now. Now is a very special time.

Before, there were times when selling some bitcoin to buy a house would be a decent plan.
However, those who did so, found that if they kept their bitcoin, they would be way ahead.

The piece to balance this out is, if you bought bitcoin low, and you are not selling your whole stash...
well then, you got a house, and still have more money in bitcoin (just not as much bitcoin).
One could make a case saying, you got your money's worth.
And how much money do you need in the future?

But today, things are very different.

Bitcoin go up

We are in, are at the cusp of the next big bull-run in cryptos.
This time for sure!

Yes, there were a lot of false calls up till now, and a lot of fake outs in the market and manipulation.

However, this time we are seeing all the signs of a bear market (except for a huge crash, then we should be off to the moon)

So, bitcoin go up.

Suburban Housing go down

For so many reason, higher interest rates, shrinking population, recession/depression, banks going under, people fleeing cities...

Suburban houses prices have just crossed the peak, and soon it will be down down down like 2008.

See yesterday's blog for the reasons spelled out
https://hive.blog/hive-110786/@builderofcastles/suburban-houses-are-set-for-the-long-slippery-slide-to-oblivion

So, house prices go down.

Trade bitcoin for a house?

At some point, bitcoin will be way up and house prices will be way down.

Let us say bitcoin went to $300,000 and a house in your city went from a million down to $300,000
... is it a good play to trade one bitcoin for a house?

I guess the answer is, it depends.

If you have one bitcoin, and only one, it will probably be the worst trade you ever did.
Of course, with $300k (assumed) being the top of the market, you might say to yourself that you made a good choice. You got out while the getting was good. But then bitcoin goes to a million and the house goes to zero. And then you are sad.

If you have several bitcoin, and you need a house, and hate renting. Go ahead and trade one. If you have a few left, you will still be richer than you know what to do with (unless you are into super-yachts).

And the other thing is, you could get a loan against your bitcoin to buy the house. This may be called in if you do not have enough bitcoin, and bitcoin crashes, however, if you can whether that, you can pay off the loan in the next bull market with a fraction of a bitcoin. (please seek expert advice on this because there are a lot of loopholes and gatchas in this very new lending market)

Homestead

Now, if you have a chance to get a sweet homestead for your bitcoin, here is a tough decision.

The homestead will be far more valuable than just money can calculate.
Like, how much extra would you spend for good food? How much more when the MSM is telling you they are poisoning meat?

Good homestead sites will also become increasingly rare (until "off grid technology" becomes a lot cheaper) and those moving onto the homestead sites are loathe to give them up. And the available market will become smaller and smaller.

So, in this case, you are trading an increasing asset for another increasing asset, and depending on where we are in the bull market cycle will (probably only in hindsight) determine if this is a good deal.

But, how many bitcoin do you need to live the rest of your life the way you want?
If bitcoin goes over a million, then, for most people, it is one bitcoin, and if you spend it wisely, you will probably have a lot of it left at the end.

So, trading a part of your stash for a good home may be a very good investment... even if it appears you lose money on paper.