Why buying a home is usually a terrible investment (vs buying bitcoin).

[kro55]

I have to agree with you. If you bought a lot of landed properties before, you could have been a millionaire today, that's how profitable it is right now. Buying a house is still a profitable investment most especially if your intention is to make it a rented apartment, the more you will gain consistent returns from it. Or just buying a house today and sell it in the future, the fact that it also appreciates in time, you will indeed be making a lot of profits then.

Some people don't like it because it takes time for landed properties to appreciate, and because of how long it takes, they feel that it is only assets that are quite volatile that are most important. Just like Bitcoin, if you invest during the bear market, you have to wait for just four to five years before the bull market starts, and then you can make a profit from your investment, but some properties will take a longer time than the four years that Bitcoin would. 

I bet no one hates real estate, people who say they don't like real estate are because they may not have enough finances to invest in real estate. It's true that you'll have to wait a long time for real estate prices to increase, but in the meantime, you can take advantage of renting to generate passive income. This is an advantage that no other asset can offer except real estate. For me, investing in real estate is doubly profitable because it can both generate passive income and resell at a much higher price in the future. The demand for land and housing will always increase as the world's population grows day by day.

[adaseb]

Generally people dont buy homes as an investment to rent out, its usually better to buy apartment buildings to rent out. You can buy multiple apartment buildings for the cost of 1 home. And you can make more revenue with all those apartment buildings than you would with renting out 1 home.

Sure bitcoin was a better investment in the last decade however hindsight is 20/20. If someone were to choose what to invest in 10 years ago, many would rather buy real estate because bitcoin seemed very risky then. Who knows what the next 10 year will bring however. Real estate in many countries seems to have topped, I dont think it will pull the same performance as in the last 10 years, but we will have to see.

[OcTradism]

Sure bitcoin was a better investment in the last decade however hindsight is 20/20. If someone were to choose what to invest in 10 years ago, many would rather buy real estate because bitcoin seemed very risky then. Who knows what the next 10 year will bring however. Real estate in many countries seems to have topped, I dont think it will pull the same performance as in the last 10 years, but we will have to see.

Risk in early years since 2009 is bigger than in 2022, 2023 or 2024 year and people have to make different choices at different times. Their thinking and decisions are different with time and Bitcoin adoption changes over time as well.

However, in 2024, if they understand about Bitcoin, its history and believe in potential of Bitcoin adoption and price growth next 10 or 20 years, they will prioritize their choice to Bitcoin than real estate. I see Bitcoin is a better investment than real estate but I won't say invest in real estate is terrible. Investment is good, if you can get profit from it and real estate can help you gaining profit and it's a good asset against inflation of fiat currency too.

[Dr.Bitcoin_Strange]

I have to agree with you. If you bought a lot of landed properties before, you could have been a millionaire today, that's how profitable it is right now. Buying a house is still a profitable investment most especially if your intention is to make it a rented apartment, the more you will gain consistent returns from it. Or just buying a house today and sell it in the future, the fact that it also appreciates in time, you will indeed be making a lot of profits then.

Some people don't like it because it takes time for landed properties to appreciate, and because of how long it takes, they feel that it is only assets that are quite volatile that are most important. Just like Bitcoin, if you invest during the bear market, you have to wait for just four to five years before the bull market starts, and then you can make a profit from your investment, but some properties will take a longer time than the four years that Bitcoin would. 

I bet no one hates real estate, people who say they don't like real estate are because they may not have enough finances to invest in real estate. It's true that you'll have to wait a long time for real estate prices to increase, but in the meantime, you can take advantage of renting to generate passive income. This is an advantage that no other asset can offer except real estate. For me, investing in real estate is doubly profitable because it can both generate passive income and resell at a much higher price in the future. The demand for land and housing will always increase as the world's population grows day by day.

Well, that's true, real estate is profitable and the reason why some persons are not into it is because they may not have  the required capital to venture into it and get lot of profit just like they would in bitcoin. For example, someone can invest $10 into bitcoin and can be consistent in investing such amount every month but there's no such strategy as DCA in real estate.
I was listening to one man on an interview or social media, this man said that he made $100, 000, 000 from real estate in 2023, I don't know if he was kidding or not but I know that if the amount of capital he invested was huge, then it's possible that he is telling the truth.

[knowngunman]

Risk in early years since 2009 is bigger than in 2022, 2023 or 2024 year and people have to make different choices at different times. Their thinking and decisions are different with time and Bitcoin adoption changes over time as well.

However, in 2024, if they understand about Bitcoin, its history and believe in potential of Bitcoin adoption and price growth next 10 or 20 years, they will prioritize their choice to Bitcoin than real estate. I see Bitcoin is a better investment than real estate but I won't say invest in real estate is terrible. Investment is good, if you can get profit from it and real estate can help you gaining profit and it's a good asset against inflation of fiat currency too.

It's not about which one is better and which one is not, it is about risk bearing. The fact still remains that no investment is absolutely risk free but you and I know that the risk involved in real estate is less compared to that of Bitcoin. As we speak, some people will still prefer to invest in real estate than investing in bitcoin not because they are not aware of the potential but simply because they can not deal with the risk involved. They choose to prioritize low risk over higher returns. The first reply on the first page of this thread nailed it, diversify your investment if you have the means since risk takers are the winners.

[Ozymon]

Take the US as an example. The average house in N. America appreciates 5 to 6 per cent per year, which sounds great at first glance. In 10 years the value of your house will almost double.

But  most people don't take into account the interest rate where the average homeowner is paying approx. 6% annual interest on a typical 30-year fixed mortgage.
So the interest alone is wiping out the gains on your annual 6% appreciation. On top of that you are paying 1% property tax year every year, maintenance and repair costs, etc.

Making matters  worse is that for the first ten years or so most or all of your payments are applied to the interest, so you wont have any actual ownership or equity of the home,
or very little...for the first ten years. And consider that much of the appreciation of your house is simply due to inflation. So if inflation is 5% per year then that alone is undermining your actual appreciation.

In my opinion, buying a house is not a good investment for several reasons.
1. Poor Investment Returns
    I agree with your explanation above, as in addition to that, you need to spare monthly/annual fee to maintain the good condition of your house.

2. Renting is Cheaper
    If you don't have any stable job or you just set your life out of your parents house, buying a house is a big liability. Besides the fact tat it is a poor investment return, you also need to pay for your daily necessities since, for people who don't have a stable job, it will be a big problem.

3. Expensive Asset
    We all know this, house is not cheap at all, and if you buy a house by installments or bank loan, it will make things worse.

4. Unproductive Asset
   All thos three points above will lead us to this point that we could conclude that a house is indeed an unproductive asset, in fact it could be liability. So don't force ourselves to buy a house before we understand what we are gonna get and get ready for it.

[Blitzboy]

Generally people dont buy homes as an investment to rent out, its usually better to buy apartment buildings to rent out. You can buy multiple apartment buildings for the cost of 1 home. And you can make more revenue with all those apartment buildings than you would with renting out 1 home.

Sure bitcoin was a better investment in the last decade however hindsight is 20/20. If someone were to choose what to invest in 10 years ago, many would rather buy real estate because bitcoin seemed very risky then. Who knows what the next 10 year will bring however. Real estate in many countries seems to have topped, I dont think it will pull the same performance as in the last 10 years, but we will have to see.

The investment world's changing faster than ever. While real estate is always a safe investment, Bitcoin represents the future. Look, real estate's great, dont get me wrong. But its controlled. You can only build so many buildings, and they're tied to specific locations. Bitcoin? Globally, digital, and not going anywhere is what it is.

Considering it. You own an excellent apartment building. But you've got tenants, repairs, taxes... It is a headache. Bitcoin? You buy it, you hold it. That is that basic. Definitely, real estate can increase in value. But Bitcoin? We have witnessed its capabilities. Its about being involved in something great, not only about generating money.

Thus, indeed, real estate has a role. But Bitcoin is where you should be looking for the next great idea. The intelligent money is already on board; this is the direction of investment.

[o48o]

I wouldn't buy a house now as that's a lots of responsibilities and work, but i totally get why people do. And btc isn't comparable in any way to owning a home, unless you are buying house only to sell later with profit.

Most people know about costs on owning houses before they buy them. And house offers you so much more concrete things then holding bitcoin. Btc doesn't protect you from the rain unless you sell it for a apartment to live in. By owning a house you can even apply for a loan and use your house as collateral, and with that you could technically just buy bitcoin with, if you really trust the gains on that. I would say that's a horrible idea, but that's just one benefit from it.

[kro55]

snip

Well, that's true, real estate is profitable and the reason why some persons are not into it is because they may not have  the required capital to venture into it and get lot of profit just like they would in bitcoin. For example, someone can invest $10 into bitcoin and can be consistent in investing such amount every month but there's no such strategy as DCA in real estate.
I was listening to one man on an interview or social media, this man said that he made $100, 000, 000 from real estate in 2023, I don't know if he was kidding or not but I know that if the amount of capital he invested was huge, then it's possible that he is telling the truth.

Between bitcoin and real estate I would choose bitcoin and so would most people here. Because we have our own difficulties and challenges and bitcoin is more suitable for us. But that doesn't mean we deny the potential of real estate and have to lie that we don't like real estate.

I believe that anyone who makes a lot of money from bitcoin will look for other investments like gold or real estate because after all, they are still safer places than this crypto market. We take more risks in search of big rewards, but when we have more money, we think differently. Gold and real estate are assets that have been proven for thousands of years while bitcoin is only 15 years old, don't try to deny that fact.

[nullama]

I wouldn't buy a house now as that's a lots of responsibilities and work, but i totally get why people do. And btc isn't comparable in any way to owning a home, unless you are buying house only to sell later with profit.

Most people know about costs on owning houses before they buy them. And house offers you so much more concrete things then holding bitcoin. Btc doesn't protect you from the rain unless you sell it for a apartment to live in. By owning a house you can even apply for a loan and use your house as collateral, and with that you could technically just buy bitcoin with, if you really trust the gains on that. I would say that's a horrible idea, but that's just one benefit from it.

The thing is that buying a house means that eventually you won't have a mortgage, and that means that your cost of living will be decreased substantially.

That's one of the main benefits of buing a house. There's no point in selling it if you will have to pay rent to live somewhere else.

Wealthy people have assets, like bitcoin or homes, etc. Just living with an income doesn't make you wealthy as cash devalues quite fast.

[Dr.Bitcoin_Strange]

I believe that anyone who makes a lot of money from bitcoin will look for other investments like gold or real estate because after all, they are still safer places than this crypto market. We take more risks in search of big rewards, but when we have more money, we think differently. Gold and real estate are assets that have been proven for thousands of years while bitcoin is only 15 years old, don't try to deny that fact.

It's good to diversify one's investment into other assets and majority of people who are earning a huge income are already investing in real estate and other asset, the only reason why some people have not invested into real estate I probably because they don't have enough capital to do so. Real estate is not a bad investment, if it was, then some rich dudes will not be making millions of dollars every month from real estate.

[AmoreJaz]

I wouldn't buy a house now as that's a lots of responsibilities and work, but i totally get why people do. And btc isn't comparable in any way to owning a home, unless you are buying house only to sell later with profit.

Most people know about costs on owning houses before they buy them. And house offers you so much more concrete things then holding bitcoin. Btc doesn't protect you from the rain unless you sell it for a apartment to live in. By owning a house you can even apply for a loan and use your house as collateral, and with that you could technically just buy bitcoin with, if you really trust the gains on that. I would say that's a horrible idea, but that's just one benefit from it.

This decision depends on the where is the financial conditions of the person right now. Some have other priorities and not seeing it as investment as they need to attend other needs. Also, owning a house depends on the location itself as it varies largely from city to countryside. But what is more important to you right now, house or work? And that I believe, is the major consideration of many.

So if you are a person who is on the verge of deciding which one is best for your situation right now - better list the pros and cons and weigh your options. After all, it is your money at stake and no one will help you earn it but yourself. Think of the long-term benefit for you, it may help you in your decision making.

[Reatim]

I bet no one hates real estate, people who say they don't like real estate are because they may not have enough finances to invest in real estate.

It is true that the prices of properties these days are crazy high and some of them not even in good locations and conditions but I think this is just proof how good of an investment it was back then because you will be reaping great returns now.

Just like in bitcoin everyone regrets not buying during its early days when it was cheap. Despite the expensive prices of real estate, it will just get higher so it is still worth it.

[Dr.Osh]

I wouldn't buy a house now as that's a lots of responsibilities and work, but i totally get why people do. And btc isn't comparable in any way to owning a home, unless you are buying house only to sell later with profit.

Most people know about costs on owning houses before they buy them. And house offers you so much more concrete things then holding bitcoin. Btc doesn't protect you from the rain unless you sell it for a apartment to live in. By owning a house you can even apply for a loan and use your house as collateral, and with that you could technically just buy bitcoin with, if you really trust the gains on that. I would say that's a horrible idea, but that's just one benefit from it.

Well, everyone has their own goals in investing. Many people whose original goal is to increase their real estate assets. So they prioritize visible assets such as houses, gardens, land, and others. However, that is still good enough, as long as it gives us profit. However, it will only affect how fast or slow we achieve success. If some people feel that using bitcoin alone is enough to bring them success, then they will see other investments as not so good for them.

[nullama]

Whilst yes owning residential property is considered an investment, I do think it's important to look at the benefits of owning property (safety, security, stability), as non tangible benefits, that are not directly measured through monetary returns to justify the investment. I think home ownership is important for these reasons.

One point that is usually not mentioned is the amount of debt used to buy your own home.

Owning with a massive debt is kinda similar to renting, with the extra risks of ownership.

If your debt is so massive that you basically have to continue paying it for the rest of your life, then that's almost the same as renting.

But with renting you can get out of there for free if there's a massive problem with the property, whereas the owner gets stuck with all those types of payments.

One of the best benefits of buying a house is to end up with a lower cost of living at some point, that is when you don't have to pay interest any more for it.

If you never achieve that, then it's not very different to renting. And if you miss the payments you might even lose your home, similar to not paying rent.

[Hewlet]

I wouldn't buy a house now as that's a lots of responsibilities and work, but i totally get why people do. And btc isn't comparable in any way to owning a home, unless you are buying house only to sell later with profit.

Most people know about costs on owning houses before they buy them. And house offers you so much more concrete things then holding bitcoin. Btc doesn't protect you from the rain unless you sell it for a apartment to live in. By owning a house you can even apply for a loan and use your house as collateral, and with that you could technically just buy bitcoin with, if you really trust the gains on that. I would say that's a horrible idea, but that's just one benefit from it.

there should not be a comparison between owning a house and owning Bitcoin. Having either of them shouldn't be a reason not to have the other. Even when you buy an house as an investment, it's never a loss because it's somehow a multi dimensional investment you've just made. You can build a single house, use some of the rooms for rent age, stay in some and still use part of it for your store that's going to still generate you additional income. After you've stayed in that building for a particular number of years, you can decide to sell it out for some one that's interested in the building. Your investment is not complete untill you have some physical assets like building on ground.

The cost of erecting a building might be very high for an average person that's just starting up which is why you build a good Bitcoin portfolio but by bit and if your end goal after a set year is to erect an apartment for yourself, you can so choose to fo it and it's never to be looked at as a bad investment. Some people that are in a third world country whose parents can't even afford to build a good house for the family will not consider any other investment choice as a reasonable one untill they are able to build a space for themselves and thier family's.

[MeGold666]

House is an investment you can enjoy and also rent to get passive income.

It's a great investment.

[Fivestar4everMVP]

Owning a house might not be a good idea in the US, but it is lucrative in other countries. I know that there are countries where the price of houses appreciated more than 5%-6%. In my country, houses' value can appreciate 100% in five years depending on the location. If you live in an area experiencing a population explosion and increased tourism, you might understand my view.

There was an anti-tourism protest in Malaga, Spain because the the price of rent increased by 16.5% in a single year. House owners in such locations will be making good profits. There are also some countries where the government doesn't charge as high as 1% yearly property tax. In some countries, property tax doesn't even exist. Bitcoin is a good investment, however, diversifying your investment to the property business is not also a bad idea.

You are absolutely correct, seems to me like you took the words off my mind, but will gladly own up to the fact that you did presented it better than I would have, and I like the fact that you used really food and valid points to drive your thought home.

Over here in Nigeria, there is no such thing as property tax, atleast, not one that I know of, I own a property and have never paid any tax for it this i am sure.
I think the mistake some of us usually make is that we tend to use the living condition of a certain or particularly country to describe that the enter world is involved in, which in this case is bitcoin.
Bitcoin is global, it doesn't operate in the USA alone, and so is buying a home, or going into real estate as a business, the people in the USA might not profit much, or make any profit at all due to the some policies of the government in the USA, that does not mean that the business or investment is not, or won't be profitable in other countries, such the policies of USA only remain in the USA.