real estate or bitcoin

Real estate or bitcoin have become popular investment options that cannot be overlooked by any global market investor.  Whereas Real estate investment has been in existence for many years, Bitcoin is barely 12 years old.

Choosing between real estate and bitcoin can be baffling, especially for the modern-day investor. Traditional investors will argue that real estate is the best form of investment because “land always appreciates”.

However, a millennial investor will argue that bitcoin supersedes every other form of investment because of the massive ROI in just 12 years.  However, like all types of investments, they both incur unique risks.

Prudent investment will yield a great return on investment for many years to come. On the other hand, you could lose your investment if you make wrong investment choices.  It can be difficult to determine good investment opportunities when you are presented with multiple investments opportunities.

Real estate and bitcoin are among the top list of most new investors. However, these investments opportunities are not risk free. To determine which one to go with, here are a few pros and cons of Real Estate and Bitcoin Investments.

Understanding Real Estate Investment

Buying and owning real estate is an investment strategy that can be both satisfying and lucrative.Unlike other investors, prospective real estate owners can use leverage to buy a property by paying a portion of the total cost upfront, then paying off the balance, plus interest, over time.

Successful investors are good at one thing; portfolio diversification. As a real estate investor, you can make money from multiple streams without leaving the real estate niche.  

However, when it comes to real estate investment a great deal of effort is involved. Keeping up with property requires regular maintenance, upgrade, and repairs. Owners need to collect rent and worry about utilities, not to mention that some properties are pricey upfront.

Although you can sell property, it can sometimes be difficult to find interested buyers. It takes time to sell, and you might spend a lot of money on upgrading and marketing to only sell at a break-even point. On the other hand, people need somewhere to live, so real estate will always be a necessity.

Pros:

  •  Versatile investment opportunities
  •  Tangible asset
  •  Tax benefits
  •  Long-term returns
  •  High cash flow

 Cons:

  •  Costly investment
  •  Not a fluid asset
  •  High maintenance.

Understanding Bitcoin Investment.

Bitcoin is the most common of all cryptocurrencies and the most talked-about investment opportunity right now. With its exponential rise in the last few months, Bitcoin has captured the attention of individual and institutional investors.

the past few months. 

Let’s look at some of the characteristics of bitcoin

  1. Decentralized- Conventional currencies like Yen, Dollar, and Euro are controlled and regulated by central banks. Bitcoin is not controlled by a single institution.
  1. Anonymous- Financial institutions know almost everything about their customers; phone numbers, credit history, spending habits, etc. With Bitcoin, people can transact without revealing their identity.
  1. Transparent- All Bitcoin transactions are stored permanently in the Block chain which is to the public.
  1. Safe-haven – Being the first cryptocurrency, Bitcoin has proven to be a reliable and secure asset.

Bitcoin traders take advantage of this volatility to buy BTC at a low price and sell at a higher price, thus making profits from the price swing.

Pros:

  • Bitcoin is non-inflationary
  • Peer-to-peer system.
  •  Ruled by economic principles.
  •  Easy to trade.
  •  Zero maintenance cost.
  •  Long-term potential.
  • Massive return on investment

 Cons:

  • High volatility.
  •  Security issues.
  •  Not a tangible asset.
  •  High risk.
  • Zero regulations.

While building out your investment portfolio, your financial background, risk tolerance, and knowledge will help you decide if you should buy bitcoin or real estate.  Purchasing Bitcoin is high-risk with the potential for high reward and low maintenance, while real estate is a long-term investment that could provide steady income or end in a big payout down the road. So in the long run, it is up to what you can afford and how much risk you are willing to take.

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