The real estate bubble

[darkangel11]

Perhaps you could look at parking spots...

Great idea, I haven't considered it mainly because finding a good parking spot for sale in the city is hard and bigger spots are very expensive. Also, it would require some automation like parking meters, unless you want to stand there all day. With enough money though (a million USD) it would be a much better choice than 2 villas for rent. It would generate similar passive income and be much more robust and maintenance free.

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[coinplus]

But, I believe the way bubble works is not this quickly.
Yeah, we are in the biggest bull run of everything in our time, stocks are great, crypto is great, real estate is great, everything is going great and we are all doing better because of the bull run but we are still trying to fix the upcoming crisis before it reaches us. You need to realize the profit before that happens and as long as you do not have anything under your hand that can lose value in a burst than you are fine.

If you are buying and selling three houses at once like some crazy Americans did back in 2008 than yeah you might be in trouble but if you just maybe get something small and try to find a buyer quickly than you will be fine.

[darthmaul]

Thats not the way it works mate. It works on the basis of demand and supply. Every real estate belongs to someone around you and it doesnt mean that its value is decreasing over the time. Its actually rising a lot because demands is ever growing for even piece of land around the corner. This is because land masses, other real estates are remaining the same while population is ever growing and thus it creates perfect demand and supply here and thus makes it valuable assets over the time. This is known to real investors and I guess you shovel follow what your friends are telling you.

[Kazuyukie]

However, unlike equity bubbles, the addition of new buyers to the ecosystem actually increases the value of the underlying token. The value (given fixed supply) is simply a product of scarcity, which is going to be directly related to how many people hold the currency. an additional buyer of tesla stock does not increase the long term cash flow of the underlying business, but each additional speculator who decides that bitcoin is valuable increases the underlying value of the bitcoin network.

[sergiom]

In my neighborhood it is literally a dream for people because it seems to be a passive income for them did you can do almost nothing in order to gain that money which is just increasing your monthly earning personaly.

[Blackrain13]

    The value of real estate is base on the area location where it built. If the area is for commercial then there is a tendency that the old model real estate will become higher in value as time goes by despite of many renovations needed. But if the area is residential or something far from the rural area the value is much cheaper.

[WellDogeo]

As far as I can see the real estate market is very similar to the crypto market. The real estate market is a kind of pumping and pouring. If you want to invest in these markets you should learn a lot before investing.

[orions.belt19]

I'm actually not sure about this part. Just a couple examples that could make your apartments completely worthless:
A natural disaster (flood, earthquake)
A problem caused by tennants (fire, gas explosion)
A war

Sure, you can insure them, but this will reduce your earnings and the insurance will never cover 100% of the damages.

Well everything has its risk. Certain stocks could be affected by floods and earthquakes depending on what you are holding. A war for sure would have an impact on pretty much everything else as well.

Maintaining a small 3 room apartment is not that much of a nightmare. We aren't talking about a villa with a pool, a garden, vegetation, a couple bathrooms.. just small city apartments which will always have a demand. You can get them in places known to never be affected by earthquakes or floods, just study the area before buying. Fire or gas explosion is always there tho, but that's life.

Perhaps you could look at parking spots. You can rent them too and they have next 0 maintenance since it's just a small rectangle of cement. The % of danger of flood is much higher too, since they are underground. But even then... assuming your car isn't there, the person renting it will have the problem, not you. If it floods, it will dry, again it's just concrete, nothing of value on your name is lost. Parking spots seem like a winner in terms of passive income. Im not sure how taxes go in these, but there should be a good demand for parking spots in cities.

I know a family that owns an entire parking building next to an airport and they make millions out of it. They've had it for years and family keeps inheriting it. A money making machine.

Having an entire building is maybe overkill for most of us, but with 20 to 50 spots you could be very well off. When BTC goes to $500,000 or so you will be able to afford a bunch of these with a single BTC.

Privately owning a parking building, especially within the city, is not available in my country. What you can do is to buy a vacant lot then have it available for rent of parking space. It's not so popular in my country but it can be found in some places especially in cities where finding parking is hard and putting up a place would be profitable. It's actually quite expensive so I would like to believe that these parking space owners are gaining huge profits.

Here in my country, land is usually appreciating especially in places where its developing. It's ideal to buy land as early as possible because it's expected that in the future the value of the land will  likely get higher. Since not every area is urbanized in my country, there are still many places where there is the potential to become developed.  It's not a bubble and real estate is a good investment because you will gain some profit unless the taxes eats it up.

[tiurminator]

I've been looking at the local real estate market for quite some time. People are buying like crazy. Less and less of them are choosing to hold money in the banks and everyone is telling me to buy real estate. This seems to be the dream of every young and old, to have a portfolio of apartments for rent. Who is going to live in your apartment when everyone around you starts to own a spare one? There's not enough people coming to towns to satisfy the market.
At the same time companies are building more and more. There's flats and houses for sale everywhere and new ones are cheaper than the old ones. Why? Because people bought them years ago for e.g. 100k USD and then invested another 20k into remodelling and furnishing. They would like to get at least 100k back, but developers are pumping cheap new flats for 90k now, who's going to buy a used, older one for 100?
These sellers are now waiting because they think it will normalize, but it won't because new ones are still built.
In a couple years people will start lowering the prices of old properties to be able to sell at all and developers will run out of options, because they are building on credit, they have to keep selling. The real estate bubble will have to burst, it's inevitable.

Are you noticing the same pattern around you where every person is trying to save up for a house to rent or buy cheap, remodel and sell with a profit (so called swaps)?

In my country, apartment is not really popular, only on a few big city.  Peoples prefer on landed house.  Every year, real estate price still record significant rise both new and old one.  But the price of the old one still higher because the now real estate usually build at the new area which is relatively far from town, lack of facility etc.  Here in my country, people getting married, buying a house, raise children, buy a car, then buying another house.  I don't see a sign of real estate bubble here.

[SunJAB]

In my neighborhood it is literally a dream for people because it seems to be a passive income for them did you can do almost nothing in order to gain that money which is just increasing your monthly earning personaly.

Their thinking only exists in a certain time and is not sustainable. They use all their possessions to enjoy, what will they do to sustain life? I think we need to be thorough in our decisions. As the future is so long, work and generate more revenue streams. For a better life.

[10BTCaDay]

Real estate is a guarantor, because a bank can go bankrupt or be removed from a license and people lose their money, and real estate is always priced.

[kripkiki12]

The situation is a bit different in my country, especially in the capital. People tend to move to cities from country side, mainly to bigger ones. There are more opportunities, better wages, etc. It generated a boom in prices on the real estate market. Buying one is a thing, but rents are crazy high. Meaning if some has enough savings it is not that difficult to invest to flats considering the relatively fair conditions in credit rates. So it can be often the case that you spend half the amount for paying back the credit monthly, than paying a rent to someone else, and you will never see that money again.